Tag Archives: gold standard

As the protracted correction and consolidation in precious metals continues, what better time to brush up on the history of the gold standard to give proper context to gold’s demand today and potential role in a future currency to replace the dollar.

...Hype, fear and outdated monetary theories simply aren't enough to support the price of gold. Every finance and economics text book teaches that gold is basically an inflation hedge, and without inflation gold is simply a useless piece of yellow metal. Either the gold bugs are right or the Fed is right, and my money is on the Fed.

You are going to see the price of gold go up… a lot and it may go up a lot in a very short period of time. It’s not going to go up 10% per year for seven years and the price doubles. It’s going to chug along sideways, maybe in an upward trend, with a lot of volatility. It will have a kind of a slow grind upward… and then a spike… and then another spike… and then a super-spike. The whole thing could happen in a matter of 90 days — six months at the most.

I am now bearish on gold because the bulls are bullish for all the wrong reasons, and the price action is supporting my position. In my opinion, gold is being supported by pillars of sand - 19 in total - and the tide is coming in.

There are those who keep insisting that there be a return to the gold standard without serious unrest and collapse. What they do not realize is that such propositions are really a call to arms. Government will not return to a gold standard because it would be a loss of power and overturn the very nature of how our republics (not real democracies) actually function....Words: 308

The closing of the gold window back in August 1971 has led governments worldwide to create endless amounts of worthless paper money and the resulting credit bubble has created a world debt exposure of over US$ 1 quadrillion (including derivatives). It has also created perceived wealth for big parts of the world's population - a wealth which is only backed by promises to pay and by grossly inflated assets. Few people realise that this wealth is totally illusory and will implode considerably faster than the time it took to create it. [Let me explain.] Words: 890

Much has been written about the merits of the Gold Standard but there seems to be a lack of knowledge about the history of the various exchange-rate regimes over the years and why each was introduced and replaced. The infographic below does an outstanding job of doing just that.

It drives me crazy when I read stuff by “economists” that is just plain wrong. Some of them are allegedly “MBAs” and “PhDs” but I think that their common sense is actually “DOA”. Unfortunately, millions in the public arena see their interviews and blogs and they seem to automatically swallow their commentaries… hook, line and sinker. Let’s address some of the nonsense that these pundits are expressing. Words: 870

If the debt ceiling deal agreement is fully implemented [it is only going to exacerbate America's financial and economic woes and accelerate the demise of the U.S.] Dollar Standard which is inherently flawed and increasingly unstable. Its demise is imminent. The only question is will it be death by fire—hyperinflation—or death by ice—deflation? Fortunes will be made and lost depending on the answer to that question. [Let me explain how the collapse of the dollar could well unfold.] Words: 944

The recent outperformance of precious metals, combined with budget problems in the United States and parts of Europe, has prompted some to speculate that gold or silver will become the next international reserve currency [but in my opinion that is highly unlikely. As such, investors would be highly encouraged to give pause [before] allocating a portion of their portfolios to precious metals. Let me explain further.] Words: 1094