Short and Sweet
The more things change, the more they stay the same
The criticism leveled at gold over the past few months brings to mind an old Murray Rothbard quote from the early 1970s, when the internet was not around to challenge the constant stream of negative press on gold. He included it in the intriguingly titled pamphlet, What Has Government Done to Our Money:
“All pro-paper economists, from Keynesians to Friedmanites, were now confident that gold would disappear from the international monetary system; cut off from its ‘support’ by the dollar, these economists all confidently predicted, the free-market gold price would soon fall below $35 an ounce, and even down to the estimated ‘industrial’ nonmonetary gold price of $10 an ounce. Instead, the free price of gold, never $35, had been steadily above $35, and by early 1973 had climbed to around $125 an ounce, a figure that no pro-paper economist would have thought possible as recently as a year earlier.”
Even when gold was trading at $35, its adversaries were predicting lower prices ($10 per ounce), and even then, under the flimsiest of arguments. Its ‘industrial” nonmonetary price? How is that different from its monetary price? Ultimately in that first leg of gold’s long-term secular bull market during the 1970s, it went well over $800 per ounce – a far (very far) cry from $10!
The lesson in all this? The more things change, the more they stay the same. Gold’s critics have not changed their tactics over the years, and they are not likely to anytime soon. But one thing has changed: Now there is a wealth of information available for you to make your own assessment beginning with this website.
Image courtesy of the Mises Institute
What Has Government Done To Our Money/Murray Rothbard/Mises.org/Pdf download
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