“The Federal Reserve System is nothing more or less than a banking cartel” says G. Edward Griffin, author of The Creature From Jekyll Island, in this excellent clip from a recent Casey Research Conference. He’s right. Prior to the passing of the Federal Reserve Act in 1913, US banks still operated under the fraudulent system
A couple of weeks ago I pointed out that the Accumulation Distribution Line (ADL) for silver was showing significant upward pressure on the price of silver. Below you can see that we have the same situation in gold.
Supposedly seeking to placate Ron Paul’s supporters, the GOP strategists have included in the party’s 2012 platform’s first draft a call for a “gold commission,” which would investigate again linking the dollar to gold. Linking the dollar to gold would limit—if adhered to, which has proven to be a problem for politicians—the number of dollars that the government/Fed could create. The Establishment sees the idea as dead on arrival.
In May, I presented what appeared to be an extremely bullish divergence between the price of silver and its Accumulation-Distribution Line (ADL). I asked whether the price of silver would rise to meet its ADL or would the ADL fall to match the price? Two and a half months later, there has been absolutely no resolution to this situation. The divergence remains, and if anything, has actually increased slightly.
I’m always amazed at the number of people I meet who believe that Washington DC will still get its spending under control, that it’s just a matter of getting the right person, or the right party, into office and disaster will be averted. Or, that when we finally hit a real crisis, politicians will do the right thing – which is, incidentally, the complete opposite of what they’ve been doing for the last 100 years. Those are long odds if you ask me.
It’s almost cognitive dissonance the way the financial markets go about their business. Everyone knows that the United States is bankrupt. Everyone knows that US Treasuries are a bubble. Yet, it’s the first place everyone runs to when things start to get messy.
A while back I caught a Peter Schiff interview on one of the mainstream financial channels where he was recommending gold. The interviewer commented that for every investment thesis there existed a scenario in which the thesis would fail. He asked, what was that scenario for gold? Mr. Schiff replied that it would require massive spending cuts out of Washington DC and a balanced budget.
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.