There’s an interesting interview with Marshall Auerback of Pinetree Captial Management posted over on Mineweb.com. It’s interesting not because of any particular subject matter, but rather the complete contradictions presented therein. The first half consists of a well-reasoned case for owning gold and why it is being remonetized in an overextended financial system. By contrast, the second half is a fallacy laden justification of many of the failed policies that are driving people to own gold.
In 2011, while Michelle Obama was encouraging Americans to grow gardens to improve their health and finances, another first lady, Leila Trabelsi of Tunisia, was taking a healthy chunk out of Tunisia’s financial reserves.
In 1971, the dollar was officially relieved of its false promise of gold convertibility by creditors to the United States. In an attempt to spare the world’s economies from the effects of creative destruction, free markets and the invisible hand were traded in for centrally planned economies. Instead of market participants determining who succeeded and failed, that task increasingly became the domain of academicians, central bankers and politicians.
In addition to the classic reverse head and shoulders pattern forming in silver, there is another very interesting bullish indicator currently. But first, credit to where credit is due. This is not my observation, but that of poster SRSrocco over on the TFMetals boards.
Anyone who has been paying attention to the precious metals world over the last couple of years is well aware of the circumstantial evidence of price manipulation. None of which is particularly surprising, as all the way up through the gold pool of the late 1960s, it has been the open policy of the US and UK governments to control the dollar price of gold.
Well, we’ve heard from Warren Buffet and Charlie Munger on the subject of gold. Looks like it’s time for their young protégé Bill Gates to jump in the ring and throw a few wild punches. Next time though, guys, how about a few dry runs off camera first?
A friend of mine, who was struggling with the idea of buying gold, lamented that gold only had any value if someone else perceived it to. Yes that’s true. As it is for everything, whether you’re talking about a share of Apple stock or a 1977 Chevy Malibu.
“Why is gold getting hammered? “the caller asked. I could hear dejection in his voice. “Gold’s not getting hammered,” I said. “The euro’s getting hammered, and right now, just as I’ve warned on my Weekly Metals Wrap interviews with Eric King at King World News, for a while to come gold will trade against the
I highly encourage you to read the latest interview with Hugo Salinas Price. Mr Price is a retired billionaire who made his fortune via a chain of appliance stores in Mexico. He is also a tireless advocate of sound money. His plan to reintroduce silver as a competing currency in Mexico would make it the most sought after money in the world bar none. It is well worth your time to understand the details of how he proposes to do this.
Despite recents price declines, gold and silver remain in long-term bull markets. The primary driver of prices is the expansive monetary policy of the US since President Nixon closed the gold window in 1971. Having absolutely no links to gold enabled the Fed to create trillions of dollars in the wake of the panic of 2008. Massive monetary inflation is followed by massive price inflation.