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For the past year, I have written of the moronic – and frankly, evil – Reserve Bank of India; possibly, the WORST RUN CENTRAL BANK ON EARTH.

India has been the world’s largest gold buyer for decades – with its citizens holding at least 10% of the ENTIRE world stock; in many cases, as their ONLY asset…

India’s love affair with gold – CBS News

…not only understanding its practical properties, but assigning it nearly spiritual significance; per the below passage from one of my favorite books – James Michener’s Caribbean – in which an Indian emigrant to Trinidad spoke of his ancestors…

How to treat grave robbers – When the wife of my great-grandfather died, he buried her wearing all her gold and silver – and an English official protested: ‘ But you’re throwing away a fortune’, but he replied: ‘She brought me a fortune, and I would not like to see her in another world poorer than when she came to me.’  Three days later, when the police came to the Portugee Shop to inform him grave robbers had dug into her coffin and taken the precious metals and jewels, he said: ‘They were hers.  She spent them as she thought best.’ But when some of the jewels surfaced in the Trinidad bazaars sometime later, he made careful note of who had them – and of how they had obtained them – and shortly after that, several men were found dead…one by one.

Not only that, India has one of the world’s fastest growing economies – if you believe government data; with a vast, hard-working, technologically savvy population.  Thus, the Indian Rupee should be stronger than those of “QE-addicted” has-beens like the U.S., Europe, and Japan…

BRICs Share of World Economy up Four Times in 10 Years

Sadly, the “RBI” has gone the opposite direction; embarking on a PRINTING spree on a par with Bernanke, Draghi, and Abe – yielding soaring inflation…

Inflation Approaching 8% Seen Eroding Real Yield: India Credit

…an ALL-TIME LOW in the Rupee…

…and by extension, ALL-TIME HIGHS in Rupee Gold on two occasions this Fall; in both cases, followed by MASSIVE Central bank intervention…

…per my November 28th commentary…

EVERY time gold has reached a new ALL-TIME HIGH in a major currency this year; it has immediately been smashed down.

As in the movie Fargo, which I have written of countless times; the bad guys continue to dig their hole deeper with each new, ill-fated strategy shift.  Recall last April, when the Indian government attempted to tax gold imports; yielding a MASSIVE, NATIONWIDE jewelers strike that eventually ended with the government backing down…

Jewelers in India End Three-Week Strike on Minister Assurance

…and now, INSANE comments from the nation’s Finance Minister that Indian gold demand was “excessive”; and thus, must be “moderated.”  Perhaps someone should tell him what teenagers do when parents tell them not to drink and stay out late…

India FinMin: “Demand for Gold Must Be Moderated”

…prompting my comments below, from yesterday’s commentary…

India’s desperate government – amidst surging inflation – is considering draconian action to slow gold demand; potentially triggering dramatic ‘unintended consequences’ – like a GLOBAL outbreak of “GOLD FEVER.”

Actually, Indian Finance Minister Chidambaram’s comments emerged from an RBI-issued report about surging usage of “gold loans” – using gold as collateral; which are rapidly emerging as the preferred financing technique amongst India’s populace…

Don’t Show Bernanke This Chart of Gold Loans In India

..and thus, solidifying their cumulative choice of “priceless” gold over “worthless” Rupees.  Heck, the RBI was stupid enough to cite Jeff Christian’s incriminating comments about the PAPER gold market being roughly 100x that of PHYSICAL supply; consequently, digging said hole deeper…

India’s central bank cites CPM Group about paper gold’s magical properties

…and prompting Zero Hedge to follow my analysis with its own take on “UNINTENDED (INDIAN) CONSEQUENCES”…

The real message here is between the lines: Just as the U.S. government’s veiled threat to curb gun sales and/or to adjust the Second Amendment altogether resulted in precisely the opposite reaction to that intended — that is, a record surge in purchases of all gun-related products — so India’s ever-more-aggressive attempts to curb gold as a monetary equivalent will simply force the population to hoard more gold, result in greater gold imports, using both legal and less-than-legal means, but most importantly lead to a surge in the gold black market as the government’s more explicit intervention in the definition of what is and isn’t money forces more Indians to seek the safety of the yellow metal.”

Sadly, the Indian “growth miracle” is being systematically DESTROYED from within by politicians and bankers; ultimately, sentencing this fragile nation of 1.5 billion to the same, TERMINAL “fiat cancer” as the rest of the world.  Tragically sad, but hardly surprising – given the long-term track record of “elites” in the public and banking sectors.

PROTECT YOURSELF, and do it NOW!

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