World Bank Wants Gold Backing As Fed Crisis Spirals

As I write today, confidence in the U.S. dollar is crumbling worldwide, as China and other U.S. creditor nations express disgust at Federal Reserve Chairman Bernanke’s debt-monetization plans.
“Helicopter” Ben’s desperate actions last week to try to paper over deteriorating U.S. finances with an announced $600 billion bond-buying program could be the final nail in the coffin of the dollar’s status as the world’s presumptive reserve currency.
World Bank Chief Makes Surprise Call for
Gold Backing of Currencies
Yesterday, World Bank President Robert Zoellick shocked many economic observers by calling for a new system of floating currencies to be pegged to gold. He wrote in a Financial Times article, “Although textbooks may view gold as the old money, markets are using gold as an alternative monetary asset today.”
The demise of the dollar and the rise of precious metals as emerging new monetary standards is exactly what our team at Independent Living predicted would happen – even back when such predictions drew ridicule and laughter.
Now some of the same commentators who had smugly hailed the reign of “king dollar” are coming to see the U.S. currency for the empty suit it really is.
Top Bond Fund Manager Turns Bearish on Government Bonds
Gas Station Prices Sky Rocket and don't accept cash or and  silver only.
Meanwhile, bond fund billionaire Bill Gross, whose giant PIMCO funds have long been among the largest private holders of Treasury bonds, is actually turning bearish on his own investments! Gross called the Fed’s new “Quantitative Easing” program to monetize the national debt piecemeal “a Ponzi scheme.”
Confirming the fundamental unsoundness of U.S. monetary policy, gold and silver prices are rising day after day – with silver taking the lead. The price-suppression schemes that formerly held gold and silver down are failing under the pressure of surging global demand among investors and even central banks who seek safe-haven protection from depreciating fiat currencies. A massive short squeeze appears to be underway.
The Fed has finally shown its hand for all to see, and the market is only now beginning to show its.
Gold just broke through $1,400 and appears poised to hit our beginning-of-the-year target for 2010 of $1,500. With silver’s thrust to $28.40, it has already exceeded our expectations for 2010!
Will the silver bull take a breather before morphing into an all-out mania that takes prices well into the triple digits? I hope so, because my objective has been to get the most readers into the safety of precious metals at the lowest prices. But given that the inflation card is the only one the Fed knows how to play, precious metals might soon become impossible to obtain attractive prices.