Shiny Things(19-12-2011) wrote: Re:Invest in Gold
Oh god, a conspiracy theorist.
Look, I'll spell it out for you. The big banks are NOT selling gold to "artificially depress the market". They are NOT "short gold". The Fed is the world's biggest owner of gold; they have no reason to want the price lower either. I could link here to an excellent piece on the hyperinflation myth by Cullen Roche but I don't think you'd read it because it doesn't support your wacky conspiracy theory. So here's the scoop.
Gold has a negative yield and minimal industrial demand. The only value it has comes from selling it to someone who's an even bigger sucker than you. And if you seriously think the Fed and the big banks give a toss about what the price of gold is, then you're the "even bigger sucker".
I'm not surprised you're not giving a guarantee on "information here provided", because your "information here provided" is terrible.
Tks for your response.
Firstly, I must enquire why U call yourself 'Shiny Things' if your view about gold/ silver (shiny things) is so pejorative if not just negative.
FYI, the current US gold stockpile is~ 8000 tons (Dec2010) (world stockpile[2009]= 165,000 tons) so unless there's value in retaining the gold, the US govt would have sold their gold... the truth I believe is that politically, gold is valuable to governments.
My question is: with govt borrowing at all time highs, how are govts going to repay sovereign debt? At bottom is a 6Sept2011 CNBC report that the yields on Greek 15yr bonds was 15.532% (screen grab at bottom).
The US govt already owes $15T sovereign debt to various parties (China being one). But as the rate of inflation exceeds the interest rate paid on sovereign debt, what's to stop the owners of USD$15Trillion from investing their cash elsewhere (Gold for instance; ppty tax will have to increase as govt needs to raise taxes to avoid budget deficits/ hyper inflation from further quantitative easing)?
Please note that any borrowing through making attractive (inflation) in interest rates by the FED will only feed later inflation since the total money owed would if not raised via taxation, will then have to be printed or else borrowed at even higher interest rates. The eventual experience of this accumulated inflation, as an when it occurs, would be termed hyperinflation which was what happened in Zimbabwe in 2009 where the govt simply printed $$$ to cover for its current account budget deficits:
Pict: Zimbabwe $10 Billion dollar notes and smaller:
 | This image has been resized.Click to view original image |
Screen grab 6Sept2011: Greek bond yields:
| This image has been resized.Click to view original image |
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At/ related:
HWZ:
30Dec2011: Invest in Gold
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