Gold – Past, present and future
Dr. Moneywise says: Gold has a past. I suspect it has a future. We live in a time when currencies and financial markets have become political enterprises – creations of the world’s governments and central banks. Since we have never seen times like these, when so much depends on the monetary largesse of the policy-makers, no one really knows where the future might lead us. Uncertainty reigns and, when that is the case, history teaches us that gold demand rises proportionally and at times impressively so.
“Why is it,” asks Nathan Lewis in a Forbes magazine article, “that the collective intelligence (let’s be generous) of today’s central bankers, and indeed all the central bankers since 1971, cannot outperform a yellow rock? This probably strikes some as bizarre, but it has always been thus. Way back in 1928, in a book called The Intelligent Woman’s Guide to Socialism and Capitalism, George Bernard Shaw declared: “You have to choose … between trusting to the natural stability of gold and the natural stability of the honesty and intelligence of the members of the Government. And, with due respect for these gentlemen, I advise you, as long as the Capitalist system lasts, to vote for gold.”
Whether or not gold is the best basis for money may be a moot point. On the other hand, whether or not private investors should own it because the money is not gold-backed remains a vital question. The gift of gold – the one passed from generation to generation from ancient times to present – is the protection it offers against profligate government, an unpredictable economy, unstable financial markets and a myriad of additional threats to private wealth. The gift of gold, in short, is peace of mind.