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Welcome to USAGOLD's "Gilded Opinion" pages. We invite you to browse our
index of outstanding gold-based commentary. To be selected as
a Gilded Opinion entry, an article or essay must exhibit a timeless
quality which elevates it above the standard fare. Thus websites
with a variety of interests link to articles published here for
reference purposes. In addition, as the name of the page infers,
Gilded Opinion items must contribute in some way to our understanding
of the role gold plays in the individual portfolio, the overall
political economy, or both. Enjoy your visit to our golden library.
See the index below for Newly Added and Most Popular
selections; scroll further down for the comprehensive Archives.
Newly Added...
*NEW* In Gold We Trust by Ronald-Peter Stoferie, CMT - Erste Group Research
We at USAGOLD are pleased to post this 55-page report from the Erste Group in Vienna, Austria on gold's future prospects. This study covers both the fundamental and technical factors which offer a "shiny outlook for existing and potential [gold] investors" and debunks seven of the most commonly cultivated myths about gold widely disseminated by its detractors. The report concludes with a discussion on the effects of inflation on gold and an excursion into the potential geopolitical and monetary outcomes likely to affect gold demand in the coming years. All in all, this report offers one of the most definitive and comprehensive arguments for gold coin and bullion ownership seen in years.
*NEW* The Wit and Wisdom of Ed Stein
Cartoonist Ed Stein is no stranger to readers of our online USAGOLD Market Updates. We have featured his award-winning, widely-syndicated cartoons for a good many years. When the Rocky Mountain News, where he plied his trade since 1978, went under earlier this year, Stein went freelance. The Rocky's loss became our gain in that he is now able to contribute a series of cartoons specifically for the USAGOLD website. We hope you enjoy The Wit and Wisdom of Ed Stein.
In uncertain times, all that glisters is a gold standard by Gillian Tett
...the logistics of embracing a new gold standard would be mind-boggling. UBS, for example, calculates that the US reserves of gold are so small, relative to its monetary base, that a price above $6,000 an ounce would be needed to reintroduce a gold standard. To implement that standard in Japan, China and the US, the price would be more than $9,000.
Unintended Consequences of the 20th Century & Beyond
Ignorance, error, and immediate interest sound like a perfect motto for the U.S. Congress, Federal Reserve, and Treasury. When media pundits, pompous economists, self proclaimed "experts", and corrupted politicians assure you that they have the solutions to all of our problems they are practicing the most evil form of hubris. The arrogance and self importance of these people is an insult to the intelligence of all Americans. They put their unproven theories into practice by committing trillions of taxpayer funds. They are only concerned about the next election cycle and not about the long-term consequences of their ignorance and ignorance of crucial facts. The accumulation of blunders over the decades by government has led to unintended consequences that could bring down our country. Recent developments will have disturbing consequences for all Americans.
Alf Field's LAST Elliot Wave gold price update
I have noticed from the emails that I receive that many people are using these reports to guide their trading activities in gold. I have had no objection to this in the past, but feel that it would be foolish to trade gold in the circumstances of the Big Kahuna crisis that we are living though at the moment. It has become a question of individual financial survival in an environment where things are happening more rapidly and with increasing violence. I feel very strongly that it is time to quietly hold onto one's gold insurance and not attempt to trade it. I do not wish to provide interim levels that may cause people to be encouraged to trade their gold to skim a few extra fiat dollars or other currencies, but lose their gold as a result.
Financial Speculation in Commodity Markets; & Is the Dollar Doomed?
Many have recognized this, and have therefore asserted that we are experiencing a "commodities bubble". This conclusion, however, presumes that the US dollar, which the world uses to price and trade commodities, is a fixed unit of measurement, like an inch or an ounce. Yet it is not, and, worryingly, it has become less so in recent years. Whereas the prices of oil and wheat measured in dollars have soared over the course of this decade, they have, on the other hand, been remarkably stable when measured in terms of gold -- gold having been the foundation of the world's monetary system until 1971. It is therefore reasonable to conclude not that we are a experiencing a commodities bubble, but rather the end of what might usefully be termed a "currency bubble".
The value of gold and the dollar are in the eye of the beholder
The markets can easily handle $3,000 - $5,000 oz. gold in the near term horizon with minimal disturbance. It is when gold rises too much over $5,000 too fast that we might start to worry about global inflation panic. My take is that over the next few years gold will establish a new equilibrium to fiat currencies, albeit at much higher level than today's $950/oz.
Treading the foothills of a gold bull market
In recent weeks, as the gold price has approached the $800 level, the rate of increase in the price, the momentum of buying interest, has slowed, one sign that a correction in the uptrend could be at hand. Even so, the low volatility and low level of public interest both suggest that even with a short or intermediate correction, we are only in the foothills of the gold bull market.
The Scientific Tale of the Creation of Gold
A collapsing star is called a supernova. The explosion is so powerful and cataclysmic that you can see it across the universe ... because the atoms inside are colliding furiously, creating intense heat - hundreds of millions of degrees. Only in a supernova is it possible to create atoms with 30 protons, 40 protons, 50 protons or even 60 protons. Nature prefers even numbers for stability... Gold is a rare, odd-numbered atom with 79 protons. After the explosion, those few gold atoms are cast deep into the universe where they sit in empty space for eons...
The Triple Decade Effect by John Richardson
So the future looks likely to be a time of great opportunity where some deft investing could potentially have the best of both Worlds... A continuing boom in stocks for some or much of the coming year, that could very well be accompanied by an inexorable rise in Gold and Silver prices, but what investors should be deftly aware of and watch for, are the signs of what looks to us, what will become an inevitable impending inflexion point, where stocks will peak out, and Gold and Silver prices will keep going higher. What we should be reading from this is that the coming boom in Gold and Silver could be monumentally greater, than perhaps anyone can imagine...
Gold is magnificent at the museum but is no museum piece by Chris Powell
From a speech at the American Museum of Natural History: Your gold exhibition is magnificent, but its inevitable implication is that gold is an antique, a museum piece, a relic -- like the dinosaurs just down the hall. To the contrary -- gold is central to the world financial system even today, even as the shroud of antiquity is so painstakingly woven around it to deceive. Indeed, gold is not just central but the very center of the world financial system.
Money and Politics in the Land of Oz
L. Frank Baum claimed to have written The Wonderful Wizard of Oz "solely to pleasure the children" of his day, but scholars have found enough parallels between Dorothy's yellow-brick odyssey and the politics of 1890s Populism to suggest otherwise. Did Baum intend to pen a subtle political satire on monetary reform?
How to invest in commodities by Puru Saxena
Our lives depend on commodities yet most are too afraid to invest in them. History is dotted with massive bull-markets in commodities, which occurred regularly. In fact, over the past 200 years, we had five major booms in natural resources. The shortest boom I could find lasted 15 years, and the longest one continued for 40 years!
Gold: Historic spike ahead? by Brian Durrant
It is common knowledge that the British government sold more than half of the nation's gold reserves at the bottom of the market in mid-1999. It's less well-known why.
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Most Popular...
Gold and Economic Freedom by Alan Greenspan
Stripped of its academic jargon, the welfare state is nothing more than a mechanism by which governments confiscate the wealth of the productive members of a society to support a wide variety of welfare schemes. A substantial part of the confiscation is effected by taxation. But the welfare statists were quick to recognize that if they wished to retain political power, the amount of taxation had to be limited and they had to resort to programs of massive deficit spending, i.e., they had to borrow money, by issuing government bonds, to finance welfare expenditures on a large scale. ... The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights.
The Nightmare German Inflation
The many parallels between 1924 Germany and present-day United States are cause for concern. As this report points out, deficits lead to inflation and uncontrolled deficits lead to uncontrolled inflation. Whether or not there will be a Nightmare American Inflation remains to be seen, however, the trend is not favorable. The survivors of the German debacle did so by purchasing gold and rare coins early in the process. As a citizen and an investor, the best you can do is prepare...
ANOTHER (THOUGHTS!) II, III, IV; --also-- The Gold Trail (2, 3, 4, 5, 6) by "FOA"
"Think now, if you are a person of "great worth" is it not better to acquire gold over years, at better prices? If you are one of "small worth", can you not follow in the footsteps of giants? I tell you, it is an easy path to follow!" -- ANOTHER 1/10/1998
"If ANOTHER's claims are true -- that a consortium of oil states has cornered the gold market (and given the impressive circumstantial evidence, this could very well be the case) -- these "footsteps of giants" become the most salient and persuasive case for gold ownership I have seen in the past decade, if not the full twenty-eight years I have been in the gold business." -- Michael J. Kosares
Greenspan on Gold and Money -- in Congressional Testimony with Ron Paul
Here we spotlight Fed Chairman Alan Greenspan's remarkable and extended dialogue with Representative Dr. Ron Paul from 1997 - 2005 during the Question and Answer sessions in hearings before the Congressional Committee on Financial Services.
Ten Rules For Investing In Gold by John Hathaway
Gold is a controversial, anti-establishment investment. Therefore, do not rely on conventional financial media and brokerage house commentary. In this area, such commentary is even more misleading and ill informed than usual.
Gresham's Law in the History of Money by Dr. Robert A. Mundell, 1999 Nobel Laureate
Gresham's Law is not a statement about static conditions; it is a statement about dynamic process. "Good money drives out bad if they exchange for the same price" is an acceptable expression of Gresham's Law. But a better statement of it is that "Cheap money drives out dear, if they exchange for the same price." Put in this way, Gresham's Law becomes a theorem of the general law of economy, a consequence of the theory of rational economic behavior.
The motivating force underlying Gresham's Law is economy: we settle a debt or transaction with the cheapest means of payment. The introduction of paper money is a more extreme case of debased or lightened coins in the sense that the value of the material of which money is made is almost nil. Gresham's Law depends on two kinds of money being equivalent for some purposes but not for others. David Hume, writing in 1752, went to great pains to demonstrate that the existence of paper credit would mean a correspondingly lower quantity of gold, and that an increase in paper credit would drive out an equal quantity of gold. (T)he main function of hoards is as a store of value, a form of saving, which reflects a desire to preserve wealth for future use. The composition of hoards is determined partly by Gresham's Law. The profit motive will ensure that the best coins end up in hoards.
International Financial Architecture by Dr. Robert A. Mundell, 1999 Nobel Laureate
Dr. Mundell was kind enough to contact us at USAGOLD headquarters this morning to provide us with the full text of his September 22 speech delivered in Prague, Czech Republic. It was in this commentary that he delivered his provocative suggestion that the European Union should "produce a gold coin, a europa equal to 100 euros, that would be an overvalued legal-tender coin," saying further that, "It was a mistake to delay for three years the introduction of the paper currency and coins and the production of a gold currency would heighten general interest in the euro."
Particularly notable is that this gold-based recommendation aimed toward the EU is couched within a larger commentary in which Dr. Mundell, a founding figure for the euro system, shares his vision regarding the international monetary archetecture. In his words, "My main concern today is with a permanent improvement in the international monetary system."
BIO: Nobel Laureate Robert Mundell by the IMF
Mundell argues that the system broke down in the early 1970s because the U.S. rejected the idea of increasing the price of gold -- and thus made gold's relationship with the dollar untenable -- not because fixed [currency] exchange rates were wrong. In fact, had the U.S. revalued gold, the system could have sailed along for another two or three decades.
America's Deficit, the Dollar & Gold by Tim Congdon, CBE
The dollar looks vulnerable. In the last few years the USA has run a vast current account deficit on its balance of payments. The deficit has been the largest in money terms, and the highest as a share of gross domestic product, in American history; it has also dwarfed the largest deficits incurred by other nations, including nations that have been a byword for financial mismanagement and bankruptcy.
Little Faith, Not Much Hope and Too Much Charity by Julian Baring
1997 Speech to the European Gold Mining Investment Forum -- "I was a bit shocked when Michele asked me to speak at this conference. Shock turned to horror when I realised that my audience had been given Hobson's choice -- listen or no lunch! I hope the invitation did not deter too many potential attendees because my views on certain aspects of the gold industry are well known and not much loved by many of you. Furthermore, I run the risk that if I speak my mind, I may be accused of biting the hand that has just fed me. I can't believe there are many people here who can stomach the thought of sitting through even a variation of my usual theme. I therefore promise to be brief - the greatest quality in any speaker...."
More Faith, Still Hope and Less Charity by Julian Baring
1998 Speech to the European Gold Mining Investment Forum -- "You may recall that when I spoke to you last year, I urged all who have the welfare of the gold industry at heart, to redouble their efforts to hasten the transfer of gold out of the hands of those who didn't need it (like the gold-mining companies and the Central Banks) and into the hands of those who actually want to own it...."
Making Sense of the Gold Price by Paul van Eeden
The easiest way to demonstrate gold's value as a safe haven for capital is to look at the gold price in terms of currencies that have recently been the subject of financial turmoil. It will immediately become evident that during times of financial crisis those investors who had gold in their portfolios were substantially better off than investors without gold. (e.g., Russian investors saw the price of gold rise by 307% in eight months and it has continued to increase ever since.) .... We have not yet experienced an increase in the gold price in the United States because of its robust economy and extremely strong stock market of late. However, now that the "New Era" has been discredited, the economy is stalling, corporate earnings are falling, bankruptcies are at record levels and the stock market is shaky -- shouldn't you be thinking about some financial insurance and a safe place to put some of your capital? ... Overall, the dollar increased by 105% from January 1990 to the present, the average (world) gold price increased by 20%.... Were it not for the increase in the dollar exchange rate, the U.S. dollar-gold price should today have been in excess of $500 an ounce.
Fiat Money Inflation in France by Andrew Dickson White
Early in the year 1789 the French nation found itself in deep financial embarrassment: there was a heavy debt and a serious deficit... in the short course of time, the French Revolution appeared to spectators and actors alike as a terrifying example of how the course of events, the force of circumstances, could overwhelm individuals. These events are interesting to us as macroeconomists because rarely have issues of a regime change in the making of monetary, fiscal and other aspects of policy occupied a more central role in the affairs of a great nation. The measures that the revolutionaries took and some of the considerations raised during the deliberations that preceded taking them, were surprisingly modern, in the sense that they present striking parallels with 20th century events and with monetary theories that have been developed during the 1970s and 1980s.
A Process of Elimination: A Speculation on Gold and the Credit Cycle by John Hathaway
Investors come to gold through a process of elimination. It is an odyssey of discovery and realization that investment vehicles thought to be potentially rewarding are in fact filled with hazard and adversity. The current gold cycle began with the collapse of the Nasdaq bubble.
Extraordinary Popular Delusions and the Madness of Crowds
We bring you Charles Mackay and his Extraordinary Popular Delusions with our own sense of mission. If the rising generations now receiving their education, or even their more jaded elders, find application in their own investment philosophy, then the purpose of this Gilded Opinion entry has been served. Complicated and timelessly revealing, here you will find examples of herd behavior, delusion, mania, craftiness, and financial loss and gain.
Bernanke-ism: Fraud or Menace?
In 2002, then-Fed Governor Benjamin Bernanke burst into our monetary consciousness with his printing press speech. His fine work earned him the honorary title "helicopter commander." While largely a background figure since then, his recent appointment to succeed Alan Greenspan as Fed chair makes this an ideal time to review Dr. Bernanke's views on monetary policy, and to speculate about what his chairmanship will bring.
A Perilous Dollar Standard by Hans F. Sennholz
The world monetary system is about to change again. ...failure to prevent the numerous crises, which put nearly all countries in serious jeopardy, is casting serious doubt.... The precarious condition of the very dollar base and chronic foreign account deficits of the United States at the expense of all creditor countries are discrediting the dollar authorities. This explains why governments and central banks throughout the world are becoming ever more reluctant to grant the U.S. government a permanent monopolistic position in matters of world money. In crisis and despair the world may choose gold.
On the Role of Gold by Otto Scott / The Compass
Foreign nations could hardly refuse to subscribe to successive new bond issues by Washington, lest such a refusal precipitate a drop in the price of holdings already in their possession. Sales of these holdings may do the same. Such runs could bring down the great global empire of paper dollars, which every government lists as assets.
This situation has long since alarmed the central banks of Europe. That is the reason for the European drive toward a common European "Euro" currency to replace the dollar. The plan makes it clear that Western Europe does not want to be inside the house that Washington built when the roof falls.
The True Believer by Barton Biggs -- Morgan Stanley Global Strategy
With equity markets having fallen so sharply and the rally in high-grade bonds, our ten-year return study needs tinkering with. Nevertheless, nothing has happened that changes our long-term assumption that we are in for an extended period of mid-single-digit returns in both stocks and bonds. ... It certainly is possible that gold can return to its long-term equilibrium inflation price of $500 an ounce, or even take a run at its all-time high of close to $1,000. What would cause such an explosion? A steep decline in the equities market, higher inflation, or competitive devaluation of the major currencies. In a bleak world, gold could beat almost everything else.
Gold as Theater by John Hathaway
Given the long history of official sector antipathy to gold, especially in the US and the UK, one would be hard pressed to explain why it had suddenly become sacrosanct. In fact, there is growing body of credible evidence that the US government and others may have been manipulating the metal price for some time.
If the US and other governments have been actively involved in manipulating the gold market, there is far greater upside potential for the gold price than I had previously imagined.
Educational Series on Gold and Money by Bill Buckler / The Privateer
Overview
Money - An "Assay"
What Is Money?
The Evolution Of Money
The Case For Gold
Money - The REAL Thing
History
A History Of U.S. Paper Money
The Early Gold Wars
The Hidden Gold Wars
Paper Gold?
Gold 1994-2001
The Trading Range 1994-1996
"Annus Horribilus" 1997
Below The Floor 1998-2001
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The Folly of Hedging by John Hathaway / Tocqueville Asset Management L.P.
Among the factors depressing the gold price in recent years, forward selling and other hedging activities have been prominent. Producer hedging has added as much as two years' of future production since year end 1996 to normal mine supply. By accelerating future supply, the gold mining industry has exacerbated its woes. In trying to protect against the downside, hedgers have magnified it. ... The thought that hedging might play an important role in depressing the gold price received little consideration. The possibility that neutralizing a mining company's exposure to the gold price might undermine the valuation of its shares received even less. ... Positioning a risky, capital-intensive endeavor such as gold mining as a spread business, similar to a bank or insurance business model, is ludicrous. ... Hedging has transformed gold mining shares from perpetual options on the gold price to prosaic, every day industrial equities trading against the shop worn metrics of enterprise value to cash flow and p/e ratios. ... It is disappointing that the industry has become almost silent on the advocacy of gold for monetary uses. While initiatives to open and liberalize markets as well as sponsorship of web sites to lower retail jewelry prices are worthwhile, the industry must do whatever it can to reverse gold's marginalization as an alternative to financial assets. The potential valuation of gold as money far exceeds the possibilities available through expanding the jewelry market. The marginalization of gold is favored by bullion dealers and multinational commercial banks that use it as a low cost method of funding via derivatives. Hedging provides order flow to these institutions that enables the derivatives trade which in turn keeps the gold price in check, absent a surge in investment demand.
A Perspective on Gold Valuation by James Turk
These Gold loans are what has cheapened Gold. The central banks lend Gold to the mining companies (via the middleman bullion banks), so the mining companies have cheapened their own product. By hedging they have in effect increased the quantity of metal through the extension of credit. What? They've created Gold 'out of thin air'? Well, yes, sort of. They really haven't created Gold; all they have done is created 'Gold substitutes'. These substitutes are extensions of credit in effect masquerading as Gold. And the central banks have pulled off this masquerade much longer than I thought them capable of doing, but for how much longer?
I don't have the answer to that question; no one does. But we all know the answer to how it will end? Badly. Just as all extensions of credit inevitably end. There will be widespread defaults. As a consequence, many people who think they own Gold will find out that they in fact only owned a Gold substitute, and they will end up owning nothing if the Gold substitute they owned was defaulted upon. . . . . the ripple effect of defaults I expect will have a knock-on effect throughout the Gold community. Any and all Gold substitutes will be doubted, and many will be defaulted upon.
INFLATION--Made Understandable by Tom Rose
The problem facing us today is that the clear language of yesteryear has been quietly changed. The former easy-to-understand thought process that excessive money creation (i.e., inflation) today will subsequently lead to rising prices tomorrow has been insidiously changed. [...] Today we are propagandized by the Federal Reserve Board that rising wage levels and/or rising prices for gasoline at service stations will cause inflation. Frankly, this is gobbledygook! It is a grossly false statement that is purposely designed to mislead people in their thinking! How can rising prices (a result) be the cause of rising prices? ...wages paid to workers and gasoline prices at the pump are simply market prices. Like all other market prices, they simply reflect the prior injections of new money into the economy. [...] In matter of fact, Keynes' idea of fostering government spending via deficit spending rather than through increased levels of taxation was a sick scheme designed specifically to fool working men into accepting lower "real wages" as rising price levels served to undermine the purchasing power of workers' paychecks.
Dark Vision for the World Economy by Bernard Connolly, Chief Global Strategist AIG
To re-balance the economy, domestic inflation has to fall below that in other countries under the influence of recession and rising unemployment. But the process of disinflation (perhaps even deflation) constantly pushes real interest rates up. Worse, asset deflation weakens balance sheets, including the government's. Bankruptcy and default, including government default, become real possibilities. Credit spreads widen, exacerbating the problem of excessively high real interest rates. Asset markets weaken further. The circle is vicious indeed. If nothing is done to break into it, the outcome will be not just economic and financial collapse but social and political chaos. ...Inflation is likely for the reasons analysed above. And all the factors that will lead to inflation will operate through first weakening balance sheets, whether of the private sector or of the government or both. Credit worries will mushroom, increasing the attractiveness of "outside" assets such as gold.
Pompous Prognostications by Colin Seymour
Applicable lessons of blustery quotes from the 1929 market crash and Great Depression:
"There may be a recession in stock prices, but not anything in the nature of a crash." --Irving Fisher, leading U.S. economist, New York Times, Sept. 5, 1929
"This crash is not going to have much effect on business." --Arthur Reynolds, Chairman of Continental Illinois Bank of Chicago, October 24, 1929
"This is the time to buy stocks." --R. W. McNeel, market analyst, New York Herald Tribune, October 30, 1929
"[the country is] on the edge of a golden age of prosperity..." --Treasury Secretary Paul O'Neill, June 24, 2001
Whither Gold? by Antal E. Fekete (Courtesy of FAME)
There is a lively gold loan market in the world: gold is put out in loans and is borrowed at interest on a regular basis. It is used in financing great capital projects as well as trade -- in the same way (although not on the same scale) as it always did under the gold standard. Under these loan contracts both principal and interest are payable in gold. Nor is this something new: gold lending has continued uninterrupted in countries where the necessary legal protection of contracts involving gold loans has not been abrogated. 'Demonetization' did not succeed in abolishing the lending and borrowing gold at interest, it only abolished the truth about it. Even students of economics are deliberately kept in the dark about the existence, functioning, and extent of these gold loan markets.
The Crash of the Millennium: An Interview with Dr. Batra by J. Taylor / Taylor Hard Money Advisors
Dr. Batra is by no means a gold bug, but he told J. Taylor that the only long-term investment he now recommends is gold and gold shares. "...debt created prosperity cannot last forever. So we have gotten into this mess by: First, allowing wages to lag behind productivity and secondly by artificially bolstering demand by creating a tremendous amount of debt. All we have done is simply postponed the problem. And, since this postponement has been going on for many years, the mess is potentially catastrophic."
BATRA: I have a number of investment ideas in my book, but what I am saying is to stay away from any long term investment except gold. ... Like I say, gold is about the only thing I recommend that you purchase as a long term investment at this time. Everything else appears very risky to me. Furthermore, gold appears very well priced right now.
Mr. Greenspan: a Proponent for Derivatives by David Tice / Prudent Bear Fund
Derivatives had enticed imprudent behavior by investors and absolutely reckless behavior by speculators. Derivatives did not contribute to wealth creation, but, instead, exactly the opposite. They were a major factor leading to huge "hot money" flows, a complete distortion of risk perceptions and they certainly became a major factor behind the huge financial excesses and economic distortions that led to the region's terrible bubble and collapse. Unfortunately, we see all the same types of behavior in the US today. In Asia, when the crisis developed, market participants not only tried to dump their leveraged derivative positions, they also attempted to purchase derivatives as insurance...this only exacerbated the crisis and led to a self-feeding meltdown.
Perils of our Monetary System a J Taylor Interview with FAME's Larry Parks
When one puts money in a bank one is making an unsecured loan to the bank. Rather than being a "depositor," one becomes an unsecured creditor. If folks better understood that, then they would have been more mindful that they were taking counterparty risk, and there would have been more oversight as to how much leverage, i.e., fractional reserve lending, that banks did, and there would have been more oversight as to the risks that banks were taking.
The key concept that folks need to understand is that fiat money is not wealth. It is merely a potential claim on wealth. That's not the same thing. [...] Ordinary people have a common problem about how to provide for themselves in old age. The answer, of course, is that one saves, and, then, when one gets old and can no longer work, one draws down on those savings to provide for necessities in old age. But, with a fiat money monetary system, ordinary people are not saving wealth; they are saving merely potential claims on wealth. The real wealth that the claims represent is actually being consumed now. So, when later comes, it turns out that the claims are said to have lost purchasing power due to some unexplainable phenomenon called "inflation," and ordinary people are wiped out.
All Work and No Pay by Paul Hein, M.D.
This book has been written in the hope that productive men and women will read it and decide that their lives' work is worth more than such numbers, which can be "extinguished" by their issuers when it is judged by them expedient to do so, whether repaid or not. For those who are content to exchange their work for no pay, and who find nothing degrading or immoral in the practice, it is not necessary to do anything. If you are willing to exchange your work for no thing, you can be sure that that is exactly what the present system has to offer.
The Dawn of a New Gold Market a Compilation of WGC Data and Commentary
On Sunday 26th September a new era dawned for gold. For the first time in almost exactly 28 years, since convertibility of gold into US dollars for official holders was suspended on 15th August 1971, the governments with the largest gold holdings made a positive joint statement on gold. (Those three decades have been a period in which gold was persistently sidelined by the official sector attempting to demonetise gold.) It is extremely rare for independently-minded central banks to agree to co-ordination of this magnitude on reserve management. France and Germany, who are known to have led the initiative, have the tradition and natural understanding of the intrinsic value of gold. They understand that gold is no one's liability, that it is universal and eternal. They hold a large proportion of their external reserves in gold because they believe that gold is the only thing that will ultimately secure a country's monetary independence and sovereignty.
As the Millennium dawns, gold is poised on the threshold of a new era, promising as ever to bring excitement into our lives. As a Renaissance courtier counselled his ducal master "Cherish the ancient, cherish the golden, you will not be an antiquarian but a man of gold."
Bullion Bankers: Spin Meisters of the Gold Market by John Hathaway
Gold's worst enemy by far is the bullion bankers. If not for their reign of terror, gold would in all likelihood have broken out of its long downtrend. Purveyors of unrelenting pessimism, their collective voices have affected a generation of thinking in the financial markets at large and among their clientele which includes mining companies, central banks, and hedge funds. ... It is quite apparent that gold has been held in check by the artificial constraints we have described. As these constraints become better understood, the short position that they are built upon on will come under speculative attack.
The Bullion Banks by James Turk / FGMR
There is a good reason why the central banks may be withdrawing deposits from the bullion banks. Perhaps the central banks see the increased risk in the bullion banks, and are therefore pulling out their Gold from the bullion banks for safety reasons. I'm sure the central banks remember how the central bank of Portugal lost 17 tonnes of Gold that it had on loan to Drexel Burnham when that firm went under. The risk of the bullion banks is clear because as the Gold price falls, the mine cash-flow drops and the mines that the bullion banks had financed become vulnerable....A couple of weeks ago, Peter Fava the head of the bullion banking operation of HSBC and also the Chairman of the LBMA, said that some central banks were withdrawing Gold deposits from bullion banks...
What Does It All Mean? by James Turk / FGMR
...there is no lender of last resort. No one stands ready to buy the long-term Gold loans made by the bullion banks for metal, which can then be used to repay deposits. Instead, if deposits start flowing out of the bullion banks, they have to keep bidding up Gold interest rates in order to reach a rate high enough to entice some one holding the metal to lend it. ...Bullion banks are borrowing the metal to remain liquid and solvent, and are being forced to borrow at ever higher rates, the typical warning sign that a crisis has begun.
...if I'm right and the bullion banks are indeed 'feeling the heat', when the Gold market turns, it will be a rocket shot. But when will the Gold market turn?
Who Owns and Controls the Federal Reserve? by Dr. Edward Flaherty
Is the Federal Reserve System secretly owned and covertly controlled by powerful foreign banking interests? If so, how? These claims, made chiefly by authors Eustace Mullins (1983) and Gary Kah (1991) and repeated by many others, are quite serious because the Fed is the United States central bank and controls U.S. monetary policy...causing the financial markets to boom or collapse, and prompting the economy to expand or to stumble into recession. Such awesome power presumably would be used to benefit the U.S. economy. Mullins and Kah both argued that...foreigners use their command of the New York Fed to manipulate U.S. monetary policy for their own and, as Kah asserted, to further their global political goals, namely the establishment of the sinister New World Order.
This essay examines the accuracy of these claims. Specifically, it investigates the charge that the New York Federal Reserve Bank is owned, directly or indirectly, by foreign elements, whether the New York Fed in effect runs the whole Federal Reserve System, and whether its enormous annual profits accrue primarily to foreigners or to the U.S government.
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Archives...
The End of Dollar Hegemony by Congressman Ron Paul
Numeraire to Saucissons? by John Hathaway
Special Market Wrapup -- "Believe it!" by Jim Puplava and Eric King
Christianity and Capitalism in History by Otto Scott / Otto Scott's Compass
Barrick's Hedge Book - A Recipe for Disaster? by Dietmar Siebholz, Florian Riedl-Riedenstein
Gold is Shining Again by Han Senholz
The Scarcity of Metal in the Gold Market
The Gold Business: Myths and Realites by Ian Cockerill, CEO Gold Fields
Best of Doug Casey: Recent Writings
Greenspan: Maestro or Music Man? by 'miner49er'
Miracle or Mirage? by Antony P. Mueller
What To Do About the Recession by William Anderson
Gold's Upward March by Paul van Eeden
The Curative Power of Economic Busts by Christopher Mayer
Storm Watch: Pedal to the Metal by Jim Puplava
The Inflation Tsunami by Adam Hamilton
Economic Changes Since the Terrorist Attacks on America by Usul
The Fed Cannot Create Prosperity by Congressman Ron Paul
When Something Doesn't Add Up! by Dr. Marc Faber
Three Easy Pieces: A Look at the Fed by Mayer/Epstein/Anderson
ESF and Gold -- Behind Closed Doors by James Turk
April Gold Review by Jay Taylor
The Case for Gold by Doug Casey / International Speculator
A New Paradigm For The Old Economy by John Hathaway / Tocqueville Asset Management L.P.
Gold Showing Signs of Life by Leanne M. Baker / SalomonSmithBarney
The Other Bubble by Sean Corrigan
Trapped Between Taxes and Debt by Bill Buckler / The Privateer
Exploding Inflation by Adam Hamilton
Gold Delta Hedge Trap by Adam Hamilton
Understanding Gold by Paul van Eeden
The Federal Reserve's Worst Nightmare by James Turk
First OPEC Heads of State Summit Since 1975 by Adrian Van Eck
Gold or Dross? Political Derivatives in Campaign 2000 by Reginald H. Howe
Gold: Can't Bank with It; Can't Bank without It by Reginald H. Howe
BIG FLOAT: The American Damocles by L. Reichard White
In Defense of our "Unalienable Rights" a J Taylor Interview with Congressman Ron Paul
The CRB Index Jumps Higher by James Turk
A New Millennium Gold Rush by Leanne Baker and John Hill / SalomonSmithBarney
Why the Gold Industry is Being Destroyed and What to Do About It by Lawrence Parks / FAME
What the President Should Know about our Monetary System by Lawrence Parks / FAME
The Golden Pyramid by John Hathaway / Tocqueville Gold Fund
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1-800-869-5115 Extension #100 6:00AM to 6:00PM MT |
For the Lack of a Compass from The Reaper / R.E. McMaster, Jr., Editor
The Winds of Change An Investment Strategy Beyond the Year 2000
Testimony on the IMF Gold Sales by George Milling-Stanley / WGC
Switzerland's gold: WGC answers ten key questions about Switzerland's gold
The Fifth Horseman by Michael J. Kosares, CPM / USAGOLD
Paper vs. Metal by James Turk / Freemarket Gold & Money Report
The Financial Bubble by Rep. Ron Paul, Texas
The Equity Culture Revisited from Elliot Wave Theorist
'Major Bull Run' for Gold... Don Wolanchuk -- A StockHouse Interview
Supplies Tighten Further, Rationing Begins by James Turk / Freemarket Gold & Money Report
Gold's Role in the Monetary System by The World Gold Council
The Asian Flu: World-Wide Deflation or Inflation? by Tom Rose
The Derivatives Mess by Bob Chapman / The International Forecaster
The Lure of the Abstract by Otto Scott / Otto Scott's Compass
The Widening World Crisis by Andrew Rothovius / The Washington Global Letter
The So-Called Masters of the Universe by James Turk / The Freemarket Gold & Money Report
Golden Needles by R.E. McMaster / The Reaper
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