krugman goes full retard on gold today

[chad]

did you know it's a horrible place to park wealth?

http://www.nytimes.com/2013/04/12/opinion/krugman-lust-for-gold.html?_r=1&

News flash: Recent declines in the price of gold, which is off about 17 percent from its peak, show that this price can go down as well as up. You may consider this an obvious point, but, as an article in The Times on Thursday (http://www.nytimes.com/2013/04/11/business/gold-long-a-secure-investment-loses-its-luster.html) reports, it has come as a rude shock to many small gold investors, who imagined that they were buying the safest of all assets.


Enlarge This Image
http://graphics8.nytimes.com/images/2010/09/16/opinion/Krugman_New/Krugman_New-articleInline-v2.jpg
Fred R. Conrad/The New York Times

Paul Krugman



And thereby hangs a tale. One of the central facts about modern America is that everything is political; on the right, in particular, people choose their views about everything, from environmental science to gun safety, to suit their political prejudices. And the remarkable recent rise of “goldbuggism,” in the teeth of all the evidence, shows that this politicization can influence investments as well as voting.

What do I mean by goldbuggism? Not the notion that buying gold sometimes makes sense. Gold has been a very good investment since the early 2000s, and it’s probably not all bubble. One way to think about this is that gold is like a very long-term bond that’s protected from inflation; and actual long-term inflation-protected bonds have also seen big price increases, reflecting a general perception that there aren’t enough alternative good investments.

No, being a goldbug means asserting that gold offers unique security in troubled times; it also means asserting that all would be well if we abolished the Federal Reserve and returned to the good old gold standard, in which the value of the dollar was fixed in terms of gold and that was that. And both forms of goldbuggism soared after 2008.

In the wake of the financial crisis — and to a considerable extent even now — to watch business news on TV, especially on Fox, was to see a lot of talking heads touting gold, not to mention many, many ads from the likes of Goldline. Many Americans were convinced: A third of those polled by Gallup in 2011 (http://www.gallup.com/poll/154232/gold-americans-top-pick-among-long-term-investments.aspx) declared that gold was the best long-term investment.

At the same time, calls for a return to the gold standard proliferated, and not just among marginal figures. Indeed, the 2012 Republican platform (http://www.gop.com/wp-content/uploads/2012/08/2012GOPPlatform.pdf)effectively demanded a return to gold, calling for a commission to “investigate possible ways to set a fixed value for the dollar” (which it took as self-evidently desirable), and making it clear that the preferred route involved a “metallic basis” for the currency.
So the financial crisis of 2008 brought a surge in gold fever (http://research.stlouisfed.org/fred2/series/GOLDAMGBD228NLBM) (although that surge has abated a bit since 2011). But why?

After all, historically, gold has been anything but a safe investment. Sometimes it yields big gains, as it did in the late 1970s and again between 2001 and 2011. But that 1970s run-up was followed by an epic plunge, with the real value of gold falling by more than two-thirds.

Meanwhile, the modern world’s closest equivalent to the classical gold standard is the euro, which puts European countries back under more or less the same constraints they faced when gold ruled. It’s true that the European Central Bank can print money if it chooses to, but individual countries, like nations on the gold standard, can’t. And who would hold up these countries’ recent experience as an example of something we’d like to emulate?

So how can we rationalize the modern goldbug position? Basically, it depends on the claim that runaway inflation is just around the corner.

Why have so many people found this claim persuasive? John Maynard Keynes famously dismissed the gold standard as a “barbarous relic,” noting the absurdity of yoking the fortunes of a modern industrial society to the supply of a decorative metal. But he also acknowledged that (http://gutenberg.ca/ebooks/keynes-essaysinpersuasion/keynes-essaysinpersuasion-00-h.html#Auri) “gold has become part of the apparatus of conservatism and is one of the matters which we cannot expect to see handled without prejudice.”

And so it remains to this day. Conservative-minded people tend to support a gold standard — and to buy gold — because they’re very easily persuaded that “fiat money,” money created on a discretionary basis in an attempt to stabilize the economy, is really just part of the larger plot to take away their hard-earned wealth and give it to you-know-who.

But the runaway inflation that was supposed to follow reckless money-printing — inflation that the usual suspects have been declaring imminent for four years and more — keeps not happening. For a while, rising gold prices helped create some credibility for the goldbugs even as their predictions about everything else proved wrong, but now gold as an investment has turned sour, too. So will we be seeing prominent goldbugs change their views, or at least lose a lot of their followers?

I wouldn’t bet on it. In modern America, as I suggested at the beginning, everything is political; and goldbuggism, which fits so perfectly with common political prejudices, will probably continue to flourish no matter how wrong it proves.

[osoab]

Great timing with this morning's raid.

[chad]

i like how he claims that runaway inflation has not happened when everything except ipads and flat screen tvs has gone up xxx% in the last 5 years.

[osoab]

Look what they are trying to do with the "chained CPI" method. You know people won't buy high beef and will switch to chicken, so the buyers "perceived" inflation is lower.

Then remember how the CPI calcs have changed over the years to lower cost products.

It's all bullshit.

The scary part is that Krugman actually may believe his own drivel.

[chad]

normally i roll my eyes at anyting he writes, but i can usually see how the less informed would buy it, as he's pretty slick in the presentation. this column though, it's like a flat out obvious lie. i haven't ever seen him do it in this kind of manner before.

[mamboni]

Krugman is a fraud and a liar. Keynes was a total fraud. His economic theory is about to blow up. Krugman is like the investor who jumps out the window of a skyscraper and on the way down is saying "so far so good." Krugman is a cocksucker for Bernanke and the money printers. The neverending attacks on gold are the tell: they are terrified that their little money printing scam will be exposed by the rising gold price. Here's the straight poop: Bernanke told Abe to inflate the Yen to help prop up the dollar. Abe has to inflate because the the Japanese demographic worm has turned and the savers are now selling assets to live off of in retirement. And Japan is now a trade deficit nation for the first time. Abe says to Bernanke we need the Yen here to finance bond liquidation and trade deficits. Bernanke says to Abe: "Your Yen is backed by the dollar. If the dollar weakens too fast you're screwed before we are. So just print alot more Yen." Abe responds "Yes Sir!"

It is well to remember that in this race to devalue and the crumbling fiat money regime, the US dollar will enjoy periodic bouts of seeming strength but will be the last fiat currency to collapse. The gold price in Yen has been on a continuous steep rise for over two years now and yet has still not surpassed the 1980 blow off top! This tells you that gold has massive upside. If you hold dollars, you are fortunate because you can get gold at bargain prices now.

They attack gold to buy some time for their crumbling fiat money scam and so they can accumulate gold at these cheap prices. Think about it: if your neighbor was investing in a loser, what would be your incentive for trying to talk him out of it day in and day out if there was nothing in it for you?

[Twisted Titan]

And so it remains to this day. Conservative-minded people tend to support a gold standard — and to buy gold — because they’re very easily persuaded that “fiat money,” money created on a discretionary basis in an attempt to stabilize the economy, is really just part of the larger plot to take away their hard-earned wealth and give it to you-know-who.



The amount of properganda squeezed into those three lines is absolutely mindboggling.



If you think times are bad now....it will go uttter apeshit if we return to a gold standard for the simple fact who own the majority of the gold? The same sociopaths that put us in the crapper in the first place. The contraction of the money supply will make the death constriction of a python feel like a warm hug.


They create money on a discreationary basis? They give away Trillions without even snapping a finger to the banker buddies that do nothing except find a way to loose it all but not before they destroy the livelyhood of millions.

They take your money and give it to you know who.

Yes i do.

They wave chickens over their heads,perform sex acts on newborns passing fatal diseases and they recite prayers holding them blameless that oaths and vows are not binding.

[mamboni]

Everyone needs to understand that this is a coordinated attack on gold by the banksters and their tools, hack economists like Krugman,the presstitutes and MSM. They can suppress the paper price but the physical gold price will hardly budge because it is held in strong hands - only an idiot would sell at these artifically low prices. And an idiot wouldn't own gold in the first place.


Maguire – Over 500 Tons Of Paper Gold Sold In Takedown

Posted April 12th, 2013 by Jim Sinclair (http://www.jsmineset.com/author/jimsinclair/) & filed under King World News (http://www.jsmineset.com/category/king-world-news/).


Dear CIGAs,


Whistleblower Andrew Maguire told King World News that more than a stunning 500 tons of paper gold has been sold in today’s takedown in the gold market. Maguire also spoke to KWN about the staggering Chinese physical gold purchases. Below is what Maguire had to say in this remarkable and exclusive interview.


Eric King: “How much paper gold was sold to take this market down, and how much tonnage have the Chinese and others been taking out of the physical market?”


Maguire: “Just since the cross (today) of $1,550 into the (London) fix and the breach of $1,500, we are now looking at in excess of 500 tons of paper gold that’s been sold….

Click here to read the full interview on KingWorldNews.com (http://tinyurl.com/bq8mgfd)

[Libertarian_Guard]

Everyone needs to understand that this is a coordinated attack on gold by the banksters and their tools, hack economists like Krugman,the presstitutes and MSM. They can suppress the paper price but the physical gold price will hardly budge because it is held in strong hands - only an idiot would sell at these artifically low prices. And an idiot wouldn't own gold in the first place.


Maguire – Over 500 Tons Of Paper Gold Sold In Takedown

Posted April 12th, 2013 by Jim Sinclair (http://www.jsmineset.com/author/jimsinclair/) & filed under King World News (http://www.jsmineset.com/category/king-world-news/).


Dear CIGAs,


Whistleblower Andrew Maguire told King World News that more than a stunning 500 tons of paper gold has been sold in today’s takedown in the gold market.

Click here to read the full interview on KingWorldNews.com (http://tinyurl.com/bq8mgfd)

“When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it”


― Frederic Bastiat

[gunDriller]

taking Krugman's advice about Gold, is like taking advice about Sex (the kind with a man and a woman) from a Devout Buddhist Monk or a Dedicated Nun.

they might know a little bit, but their lack of experience makes their possible insight far less useful.

[ShortJohnSilver]

Things TALMUDIC CRIMINALS hate:

1. Gold and silver used for monetary backing of a currency.

2. The US Constitution, specifically freedom of speech, of the press, and the right to bear arms.

3. Christianity in any form.

[Libertarian_Guard]

I would think that any form of organized jewery would love christianity. Its so easy to lead them around, and overall, they have a huge interest in promoting the evil state.

[mamboni]

How the Gold Market was Crashed

There’s been a recent huge draw down of physical gold at the New York COMEX and at the JP Morgan Chase depository. Look at the physical market draw down on the charts below. It has taken a drastic plunge.

HOUSTON -- we have a problem.

Physical inventory drawdown at JPM


Charts by Nick Laird of www.sharelynx.com (http://www.sharelynx.com/)

http://goldtrends.net/Resources/Pictures/2013/April/Gold/GoldInventoryJPMAPril2013.gif



Physical Drawdown at COMEX


Charts by Nick Laird of www.sharelynx.com (http://www.sharelynx.com/)



http://goldtrends.net/Resources/Pictures/2013/April/Gold/GoldInventoryComexApr2013.gif



You can imagine the dilemma this is causing for the market interests behind these inventories. If the inventory runs out and one cannot meet deliveries then it has to be bought on the open market. Not only that but it could cause a run up in prices that would hurt the shorts in the market.

So what to do?

There is only one way out of this for the market controllers would be to devise a plan that would collapse the market and trip up all the stops at the correction lows in gold of 1525 thereby setting off the stop loss orders under this important market low. And what if the plan included a way to stop the physical market from purchasing gold under 1525 while that correction was underway?


And how can that happen?

They have to hatch out a plan and carefully orchestrate it in a series of events that takes the gold market by surprise and force the players out of their positions.

Read on for today’s lesson in market manipulation and allow me to relay my speculation about what transpired last week.

A successful ambush usually involves surprise.

One of the main new weapons in the FEDS arsenal is TRANSPARENCY.

After a lifetime of silence the FED all of a sudden has come out of the closet and has decided that the best thing for the market is to be transparent and to that end they now have televised communication meetings with the general public so chairman Bernanke can explain the FED policy and answer any questions that the market has on its mind as well as the usual minutes that get released to the markets that review the policy decisions and discussion of prior meetings.

Why does the Fed need to explain what they are doing now?

Well it isn’t because everything is going just fine. Put it this way. They must figure when you have 50 million people on food stamps and the Dow Jones is going up a few hundred points a week and making all time highs and you have 16 trillion dollars in debt and interest rates are zero, its best to have a communiqué every month before someone asks you to explain what is going on. It’s called staying ahead of the curve if you will. If you tell them what’s going on it makes it look like you know what you’re doing. Otherwise all we have is the statistics and by themselves they tell you something is wrong, something is terribly wrong. So they have become transparent.

During the last communiqué the chairman made it abundantly clear that QE was here to stay until the unemployment rate reached acceptable levels. This communiqué whether by personal appearance or by releasing the FOMC minutes of the prior meeting is something the FED relies on so market participants can remain comfortable and abreast of Fed monetary policy.

Three strikes and you’re out

The FOMC minutes from the last meeting were due for release during last week. But a funny thing happened. They got released EARLIER than expected. It was all a big mistake and the FED let the SEC and the CFTC know right away that the error had occurred. And lo and behold even with all its transparency there happened to be some language we didn’t get updated on until the FOMC minutes were released. The notes say that several members have been discussing cutting back on the stimulus. That was strike one. It got the gold market thinking that stimulus cuts might be coming.

Strike one

Surprise number two

Then a bombshell was released from news sources. It was reported that Cyprus would have to sell 400 million Euro’s of gold as part of the bailout package of raising money for their failed banking system. Gold prices came down to 1550 on the news and the day passed by. Even though Cyprus bankers tell us the next day that they didn't discuss selling any gold, market jitters seemed to remain and Friday was just around the corner. This was strike two.

Now we need a strike three and you’re out. Gold is a nervous market to begin with as a lot of people have already lost a lot of money in the last six months.
With Gold at 1550, all that is needed for the market to drop is to get one more push where all the stops are (just below the 2 year low of 1525).

The selling began in the Friday sessions overseas. By time we got to the New York COMEX gold open, the price was down to 1542. Now all the players are there and the volume and liquidity is there to create the final blow to the market.

And then the attack began. Wave after wave of selling until gold got to 1525. Then they break down the price below the two year low and all the stops that have been accumulating there start getting tripped up and the selling accelerates as it begins to feed on itself. The physical market for gold sees this as a gift and gets ready to make their move and buy up the gold.

Now comes the part that is pure genius or a total coincidental thing that just so happens to be a gift to those who are short the market and those who would be responsible to deliver gold should the inventory deplete.

ALL OF A SUDDEN THE LONDON PHYSICAL PLATFORM THAT BUYS AND SELLS PHYSICAL GOLD GETS LOCKED UP. THE SYSTEM FREEZES.

The screens all freeze.

What does that mean?

No one can get to the physical market to buy at these low prices but at the same time, they can’t sell or protect their position either. The system is frozen. Yes, just like at Bit-coin. The system locks up. And of course the results are going to be the same, just on a lower percentage level.

What can the physical holders do?

Meanwhile the futures market continues to drop.

So what happens? The physical market holders begin to panic. How can they protect themselves as they can’t sell either?

What would I do if I were in that situation?

There is only one solution, especially during a panic. Short and ask questions later.

Therefore it is my speculation that based on 350,000 contracts sold on Friday and the massive drop, some of those contracts was the physical market having no choice but to enter into the futures markets and in order to hedge their physical position holdings, sell contracts or short the market. It’s either that or wait until Monday and be subject to potentially heavy losses should margin calls go out over the weekend. With no time to think and survival instinct kicking in, the physical holders most likely did what they could to protect themselves. They went in and shorted the futures market.

From there the market goes into a free fall as the physical market can’t buy at these low prices because the computer system is down; they can only sell futures to hedge their long physical holdings and so they do what they have to and begin selling futures.

Now it gets worse. As the price drops even more, underfunded players are getting wiped out and now they begin to liquidate. The market goes into a total collapse as all the stops below 1500 get tripped up and the market tanks to 1490.

The market finally closes in New York and returns to the 1500 area.

But it’s not over. There's another situation going on. The weekend is arriving and players begin wondering about margin calls? How are holders going to get money to their brokers over the weekend for the Monday trade session?
But there is not enough liquidity as the COMEX has closed and only the aftermarket GLOBEX is there to execute trades.

But guess what folks?

The banks and brokers are open all weekend and as long as it takes to go through all the accounts and issue all the MARGIN calls.

If they get the margin calls out by Saturday, the customers have 24 hours to get more money to their brokers. If the money is not received by Sunday night or Monday morning, the positions will have to be liquidated, just when the market is at its lowest liquidity and the longs have had all weekend to think about it and the media has had time to tell everyone that the bull market in gold is over.

Not only that but the shorts know exactly what is about to transpire.

I hope you got the picture on how the control boyz forced a major sell off. I speculate the panic over low gold inventory had someone hatch a plan to save their accounts and a lot that is at stake.

They started with leaked information with explosive potential changes in USA policy, and then they published information that Europe/Cyprus would have to sell 400 million Euro's of physical gold. Finally once the sell off began the physical gold market platform in London locks up and no one has buy or sell access in the physical spot market.

As the market players begin to work this out in their mind there is only one thing left to do. Try and exit and get out in the Globex market. So the selling begins again. The market hits below 1500 and then 1490 get broken. The market sells as much as it can up until the very last minute of trade at 5PM New York time. Even then it’s not over. For some reason the volume and the price keeps moving. Was there special consideration going on for those connected who wanted out? I don't know. But at 5:07 PM Eastern standard time the market closes at 352,248 contracts and a price of 1476.10 down a whopping 5.67% -88.80 dollars.

Did the control boys lock down the physical market platform or was it pure coincidence? Either way they have total plausible deniability. HOW?

The computer system went down. It couldn’t handle the traffic and it shut down or a glitch happened in the server. It can be any one of many reasons.

This exact same thing happened during the last take down of gold in late December 2011.

VOILA. The perfect excuse and the perfect scenario.

The physical markets couldn’t buy at those low prices.
Let me repeat that. The physical markets couldn’t buy. They could only sell futures to hedge their physical gold positions.

Of course this will all be reported on the news and in the financials right?

Wrong.

None of it will be reported as none of it was reported on Dec 29th, 2011 when the control boyz did the same thing and locked out the computer and left the physical market holding the bag. Not one word hit the papers.

Most people are not even aware that the physical market is run by computers. They have never considered or thought about how the physical market works and executes. Guess what folks? It works the same way as Futures via computers and programs.

How do you think it works? Did you think that people show up with all their gold at an auction house and buying and bidding goes on with a mediator who can speak two hundred words a minute and gold is auctioned off like rugs or art?

No it runs off a computer system.

How do I know all of this happened today?

Because I was in direct contact with a big physical dealer out of the mid-east as it was happening. They have taken the time to explain the physical market and how they get SHUT out of the game --- just like they did during the last panic (and physical shortage) in Dec of 2011.

Here is the screen shot of the actual physical market in action from January 4th 2012 that the physical trader sent me.


http://goldtrends.net/Resources/Pictures/2013/April/Trade/PLATFORM.gif

That completes our lesson for today on how to force a major sell off. You start the ball rolling with disinformation and early leaks and surprise with potential policy change considerations at the Federal Reserve level and you follow it up with a potential huge gold supply story that could come to the market.

You've shaken up the market and the selling begins and gets to within 20 dollars of two year lows where all the stops are and then you bring it down to where all the stops start getting tripped up and you just sit back and watch the market do the rest. Finally, you shut off the physical system and stop gold buying and at the same time you force physical dealers to sell the futures to hedge themselves.

There's even a term for this in the trading world. It's called "Beat the Beehive." You smash the nest and then watch the total confusion feed on itself. By the next day all the bees are gone and all that's left is a smashed up beehive.

There has been a lot of speculation on the markets and manipulation that is going on. What I've offered in this report using the fact that gold crashed on Friday is a scenario on how it could have been orchestrated. I leave it to the reader to pass judgment on the potential.

At 8:33 AM Friday morning with gold just beginning to trade, GoldTrends listed a potential for $1490 on twitter if $1525 was taken out. Here is the chart of the COMEX session. Note the low. That blue channel line was what we based our projection potential on. The rest as they say is history.


http://goldtrends.net/Resources/Pictures/2013/April/Trade/GolHrly12AprIntra1.gif

What Next?

I will be assessing the damage over the weekend.

If there really is a shortage then there will be clues that should show up that should show up in the physical markets. We will be on the watch for them if they develop. If we see these clues we will advise subscribers as they develop. The last system lock out was on December 29, 2011. The clues showed up then and a 270 dollar rally took place from 1525 to 1795 by February 29th. Interestingly on Feb 29th, gold fell 100 dollars an ounce on a Bernanke announcement that the Fed was considering slowing down on QE.

Let me say this. IF the Feds were to slow down on QE the entire system would collapse in a major deflationary spiral. In a speech two months ago at a college Mr. Bernanke admitted that the FED always tries to "talk" control or what they want to see happen. When that doesn't work they expand to other more important methods of policy.

There are only two things that can bring gold down. A manipulated event like we just saw or a liquidity squeeze like we saw in 2008 where an immediate need for cash forced the liquidation of all assets. Can it happen again? Yes, but this time it would be on a global scale and much more powerful than the Lehman crisis of 2008. While many think a sovereign default would create an inflationary spiral, it’s the opposite could happen. A default would result in liquidation and 99 cents out of every dollar in the banking system has been lent out. The need for cold hard cash would be enormous and the only way to get it to avoid leverage margin calls would be to sell assets at a low enough price to attract immediate cash. That is what happened in 2008. With one penny in banks and 99 cents of debt a spiral the other way could develop.

But you say the FEDS could print the money. Would they have time?

Once a deflationary collapse takes place, then a HYPER INFLATIONARY event can take place. But this is all for another report.

Stay tuned as it's probably going to get real interesting.

We are now at a critical juncture in gold’s 21st century bull market. At www.GoldTrends.net (http://www.goldtrends.net/) we monitor the price patterns on an hourly, daily, weekly and monthly basis. We offer commentary on what it all means along with support and resistance levels along the way in advance of each day’s trade. If you would like to join us for 30 days we offer a free trial. Visit our website home page for details. We’d like you to join us and try us out.


May you all prosper,
Bill Downey



Bill Downey (Goldtrends@gmail.com)
http://www.goldtrends.net/ (http://gold-silver.us/)

[mamboni]

http://www.youtube.com/watch?v=WTC1-yhKJS4

[mamboni]

What Smarter Minds Than Mine Think About Gold



By Adam Taggart (http://gold-silver.us/users/rosentaggart) on Fri, Apr 12, 2013 - 2:04pm



If you're long the precious metals, beatings like they're taking today (gold down 4%, silver down 6%) can seriously shake your confidence. At times of self-doubt like these, I look to learn what people smarter than I are thinking; as there's a good chance they're seeing the big picture more clearly.
Over the past week, I've had a lot of good fortune to do just that. The bottom line? More than ever, the smart minds see fewer better options than the precious metals for preserving (and likely increasing) the purchasing power of one's wealth.


Last Friday, Chris and I had the pleasure of spending the day with John Hussman, John Mauldin, Jim Chanos, Mike ""Mish" Shedlock and Michael Pettis the the Wine Country Conference in Sonoma, CA to benefit ALS Research. It was simply amazing to spend time in such rarified company and engage with each of these impressive thinkers 1on1. I'll post a more detailed write-up of my experience at the conference next week when I have more time to write (Chris and I are still on the road).
What struck me was the consistency with which nearly all of these speakers advise holding precious metals.


Some, like Hussman, see markets as dangerously out of equilibrium; with precious metals providing safe haven security during the inevitable correction to a more natural market state. Mauldin, while perhaps less pessimistic about the future, sees gold as essential insurance against central bank monetary recklessness -- and explained to me how he personally follows a disciplined process for making regular purchases, no matter what the market action is. Mish -- the deflationist among the group -- devoted much of his presentation to making the case why renewed stress in the credit markets is inevitable, and that gold will be one of the smartest/safest places to park capital during this time.


Charles Hugh Smith also attended the conference. He's been mentoring me on the basics of options investing, and as we're trading the miners, we've been watching the precious metals closely together. As Charles has written many times on PeakProsperity.com, he sees both cash and gold as prudent positions given market fundamentals and thinks both will likely rise (http://www.peakprosperity.com/insider/79855/why-gold-dollar-both-rise-here) from here. As for the recent weakness in PMs and today's bloodbath in particular, he can see no fundamental reason for it.
But most influential for me was a private meeting Chris and I had yesterday with Richard Russell, a true legend in the economic analysis business. Richard's impressively successful career has spanned over 50 years; he lived through the Great Depression, flew bombers in WWII, and followed nearly every market cycle known to modern man. Which is why I take his assessment very seriously when he refers to today's financial market conditions as "unprecedented in his lifetime". He sees today's elevated market prices as dangerously unsupported by fundamentals and primarily caused by central planner manipulation and opportunistic self-interest by the the agencies in power (big banks, politicians, corporations). "What else but gold?" should investors hold at this point, he asked us, genuinely interested if we had any good alternatives to offer.


When a legend like Russell is this concerned -- someone who has demonstrated a lifetime of balanced analysis, willing to switch between the bull and the bear sides based on the data -- we all better pay close attention.


And last night, Chris and I had dinner with Mike Maloney, of GoldSilver.com. As founder of one of the world's largest dealers of precious metals, Mike's support for owning PMs comes as little surprise. But what does surprise me is the tone his argument for ownership takes. He's frustrated by the efforts to suppress the prices of gold and silver, even though it's allowing savvy investors to accumulate metal at a cost far below what he believes fair market value to be. But the false signals that today's prices give keeps the smaller investor, who arguably would benefit most on a relative basis from protecting their wealth, from entering the market. And even though he remains confident precious metals prices will be higher -- much higher -- in the future, there's a sadness behind this prediction. Those high prices will be the result of a destruction of our monetary system and a corruption of our free markets, fundamental underpinnings that made our society great. Without them, yes, those who hold PMs will be better positioned than most (MUCH better positioned in Mike's view) -- but we all will have lost something much more valuable.


What struck me from each of these interactions was that none of these smarter minds would I describe as a PM 'cheerleader'. Their positions were arrived at through empirical, data-driven analysis; and in many cases, their endorsement of gold and silver is made with a measure of emotional reluctance. These are not people pushing gold to make a buck or advance an ideological agenda. These are concerned men looking to find options that will help their followers prosper, and finding few.
So, while the anxiety and emotions swirl powerfully on price smashes like today, I'm able to withstand them better due to the sober counsel I've received from those mentioned above. If you're playing the long game (as I am), days like today are just noise. In fact, they're good opportunities to add to your positions at lower cost, if you have the dry powder and the courage to do so.


Hopefully, the insights above help those of you holding the precious metals similarly ignore the noise. And orient on building true wealth of the kind our ReslientLife.com (http://www.peakprosperity.com/prepare) community focuses on. Many of the conversations Chris and I had with these smarter minds above ended in a discussion of the importance of the resiliency-building we advocate and enable here on Peak Prosperity. We are beginning to see these precious metals experts validate our position that, while important, money is not wealth. True wealth is your safety, health, relationships, work, community, knowledge, skills, etc. And advancing those are what will ensure a prosperous future.


http://www.peakprosperity.com/discussion/81503/what-smarter-minds-mine-think-about-gold

[Horn]

Just take one look at Krugman and can see the bias towards his cousin.

47034704

Why would anyone think differently?