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"Gold Is The Ultimate Money" says Ron Paul

GoldCore's picture




 

The mooted savings levy in Cyprus is a form of wealth confiscation on behalf of the EU which is making depositors throughout the Union nervous. There has been no dramatic increase in the demand for gold in recent days. However, this could be a ‘tipping point’ moment when savers realise that they are unsecured creditors of banks and their savings are not sacrosanct.

 

Dr. Ron Paul was interviewed by Fox after the U.S. Federal Reserve confirmed it will continue its QE program highlights the importance of gold as money.

On July 13, 2011, when Dr. Paul was a U.S. Congressman he asked U.S. Fed Chairman, Ben Bernanke, "Do you think gold is money?" and Bernanke replied, "No, it’s a precious metal."

Dr. Paul countered, “Even though it’s been used for 6,000 years?” But Bernanke denied gold was money and said, “No, it's an asset. Just like T-Bill's are not money.”

The Fox News interviewer then commented, “Cyprus has taught us that governments can confiscate money that you've earned or even paid taxes on. Rampant quantitative easing and price fixing by governments may prop up the stock markets but it doesn’t keep unemployment down. The U.S. Fed is going to continue its QE program which is good for gold.”


Gold in Euros, 2011-2013 – (Bloomberg)

If you think about refugees fleeing their country for safety do you think they use a government’s paper currency to help get them out? No it is money like gold that is used to help buy their freedom.

Dr. Ron Paul continues to believe that once the government destroys its currency it has to turn back to something it believes in like gold.


Gold in U.S. Dollars, 2011-2013 – (Bloomberg)

Therefore, Dr. Ron Paul feels a gold backed currency will be used in our economy again.

 

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Thu, 03/21/2013 - 18:22 | 3359575 therover
therover's picture

+1 BigJim and thanks for adding to my point on CPI and how it's fucking manipulated and a total bullshit number.

 

They replace that hand smoked organically grown bacon with the garbage on the shelves today and keep it the same price and say 'See, prices have not increased' No, but the fucking quality sure has decreased. They constantly subsitute one good in the basket for another, and they say it is due to consumer preferences. Load of crap.

Same with keeping the price the same on snacks but putting 25% less in the box. 

They got lots of pretty ways to screw with that CPI number and that 'basket of goods' they use to base it on. 

Thu, 03/21/2013 - 15:43 | 3358832 Whalley World
Whalley World's picture

The inflation rate of gold is 1 to 2% based on its extraction rates.  Fed Reserve Notes, ehem! To the Universe and beyond.

Your line of reasoning sounds like you work for JP Morgan or the Fed, and I am Fed Up with your BS

Thu, 03/21/2013 - 15:25 | 3358700 Croesus
Croesus's picture

@ Slightly Skeptical:

There are a lot of different ways of looking at it, but I'm a simple man:

At the end of the day, you have your viewpoints, and goldbugs have theirs. What I will say to you, is this: There is a "natural rhythm" to the world, that exists in people, nature, markets, weather, etc. Whenever "there is a disturbance in the force", nature seeks to restore that rhythm.

What we have today, is complete chaos all across the board, implying that "nature's reaction" is coming. The farther our actions take us, the more violent the reaction will be, when the pendulum swings the other way.

Forgetting fundamentals, forgetting what "so and so said", and what we think we know, there is a simple truth to Gold that no other asset can boast, and that is its history as an "item of value" that spans all cultures and time itself. 

This natural affinity people have for Gold, is what guarantees its stability, and value.

This affinity has outlasted governments, and civilizations; it predates religions, and it will outlast the ravages of central banking too.

Thu, 03/21/2013 - 14:40 | 3358385 Peter Pan
Peter Pan's picture

Your bacon analysis perhaps needs to be fine tuned to reflect howmany pounds of bacon and how many grams of gold the average wage could buy back then and compare it to how much of each the average wage can buy today.

Thu, 03/21/2013 - 14:19 | 3358292 SAT 800
SAT 800's picture

For the love of Christ, man; gold was money in 1912; the dollar was defined as a quantity of Gold or Silver; now it's a world wide free market, vers a vers, currencies. Wake up; please. You're analysis is completelly gaga.

Thu, 03/21/2013 - 15:51 | 3358866 Citxmech
Citxmech's picture

No shit, huh?

Mr. Skeptical, GOLD has been the the closest to the ideal form of "money" available to humans for more than 6,000 years.  It is not a proxy for anything - it is a universally medium of exchange (ie "money").  Debt-based, fractional reserved, fiat, on the other hand, has shown an average lifespan of somewhere around 40 years before it loses it's value - therefore it is a sub-par incarnation of "money."

Relying on fiat to hold value is a fool's errand.  Contemplate the implication of the fed's "target rate" of inflation of 2% and what this exponential devaluation implies for your wealth (ie "halving times, etc.).

Fiat is the means of debt-slavery and the theft of wealth by the oligarchy.

 

Thu, 03/21/2013 - 13:39 | 3358027 akak
akak's picture

Or just perhaps, due to fractional-reserve banking, which was universal even in 1912, gold was undervalued at that time?  Or maybe it has something to do with much higher demand for gold today than in 1912, when the world was (not quite yet) in the middle of financial and monetary collapse fueled by excessive levels of debt and reckless, kleptocratic, free-spending governments with no concern for tomorrow?

Thu, 03/21/2013 - 14:11 | 3358242 slightlyskeptical
slightlyskeptical's picture

This is a much better response. It could also be that inflation expectatations are extremely high. Or it could be that gold is more of a fear trade than an inflation trade, which is my thesis based on the historical info. Fear is high so i have been tempted to buy gold even at these overvalued levels. Just can't seem to pull the trigger while sitting on this info.

Thu, 03/21/2013 - 15:50 | 3358868 Lordflin
Lordflin's picture

Which trigger, exactly, are you contemplating pulling?

Thu, 03/21/2013 - 14:25 | 3358315 SAT 800
SAT 800's picture

You're not sitting on any "info." You don't understand how to evaluate the situation. And yes, of course, it's a fear trade; a powerful and often valid human emotion. so what? Cherry pick some more reasonable data points; like prices since Nixon torpedoed, uni-laterly our solem treaty with other nations to redeem the dollar at $35/once. The whole world knew it was undervalued at that rate, and the free market price was hovering around $40/ounce; outside the control zone of the US; eg. in Europe. So check prices based on $40 gold in 1971 vis a vis today. You're not going to understand what was going on in 1912 until you study a few thousand pages of serious history and text books; do yourself a favor and pick a data point from which fairly comparable and useful numbers are available.

Thu, 03/21/2013 - 14:36 | 3358359 slightlyskeptical
slightlyskeptical's picture

You want to run comparisons from the year 2000 until now? It will show gold overvalued even more. All I am saying is that Gold, if bought as a proxy for inflation, is overvalued. No one here has disproved that. If you have other motives that is fine, but if you rest your laurels on the inflation issue then there is no other conclusion to come to.

Thu, 03/21/2013 - 15:00 | 3358549 akak
akak's picture

And I bet lifeboats have a rather larger value during a shipwreck than at any other time as well --- that does not necessarily imply that they are therefore "overvalued" at such a time.

Thu, 03/21/2013 - 14:00 | 3358170 nofluer
nofluer's picture

Have you thought about expressing the price of gold in terms of "price per unit per person" - ie there are a LOT more people arond today than in 1912. If all the gold around then were equally divided and handed out to all of the people in equal shares, how much gold at what price would each have? And then do that for today's population.

So.... comparing the two times,  is gold still over priced? Under priced? Just a shiny metal with not much real-word value because it's mostly useless?

Thu, 03/21/2013 - 14:15 | 3358266 akak
akak's picture

Actually, and when I first discovered this fact I thought quite surprisingly, there is within 10% as much gold per person in the world today as there was in 1900 --- and in 1800 --- and in 1700 as well, which is about 0.8 oz. per person.

If there was enough gold 100 or 200 years ago to support a gold standard, then there is also enough today to do the same.

Thu, 03/21/2013 - 14:14 | 3358261 slightlyskeptical
slightlyskeptical's picture

I am just saying that based on the stated reason for owning gold...inflation...that gold is overvalued. I never never claimed that it was a proxy for inflation.

Are you all saying that Gold is not as correlated to inflation as has been preached on this forum?

I don't want to clog up these boards any longer with this debate. You have the facts in front of you to make your own choices.

Thu, 03/21/2013 - 14:30 | 3358335 SAT 800
SAT 800's picture

Serious academic study by professors of Statistical Science show that the Gold Price does not, repeat not, correlate well with inflation. Various theories can be supported by this data point. Most fundamentally, markets are records of human reactions and human emotions; sometimes the mass mind "decides not to notice" inflation; (it never went away it's been grinding away in the background all the time), at other times it "does notice it" and react to it. What you said about the fear trade is undoubtedly true; When you live in a world where a Bank has "a few hours of liquidity left"; you want something to hold onto that isn't going to evaporate. This is in-itself; a value.

Thu, 03/21/2013 - 15:00 | 3358556 slightlyskeptical
slightlyskeptical's picture

That was my point all along. Gold does not correlate with inflation, despite it being preached over and over that it does.

Thu, 03/21/2013 - 13:27 | 3357967 nofluer
nofluer's picture

Good and loyal friends are the ultimate money. Gold would be a close second.

Thu, 03/21/2013 - 13:42 | 3358056 Greshams Law
Greshams Law's picture

So true. My good friends Smith & Wesson also help me watch over my stacks.

Thu, 03/21/2013 - 13:34 | 3357932 Bansters-in-my-...
Bansters-in-my- feces's picture

Bloomberg is running a hit piece on Gold today called echoes.
About Gold confiscation....
Fuck yous bloomberg.

Thu, 03/21/2013 - 13:22 | 3357916 Bear
Bear's picture

We are in such as bad place now ... The US is printing fiat, sending it to Euro banks while at the same time China is printing and buying our gold (and everyone elses also)

Thu, 03/21/2013 - 13:11 | 3357831 Sandy15
Sandy15's picture

If that is the case, they will have to price gold somewhere between $5000 - $10,000 per ounce to cover the printed money...........

Thu, 03/21/2013 - 13:13 | 3357853 TerminalDebt
TerminalDebt's picture

Not if you make new money and value the current money at 0

Thu, 03/21/2013 - 14:32 | 3358341 SAT 800
SAT 800's picture

Both of the above are possible; or some combination thereof.

Thu, 03/21/2013 - 13:11 | 3357827 Mad Mohel
Mad Mohel's picture

Ignore the bearded one at your own peril. It is tradition.

Thu, 03/21/2013 - 13:10 | 3357819 TerminalDebt
TerminalDebt's picture

They are making money out of plastic now, you can't even use it as toilet paper anymore

Thu, 03/21/2013 - 13:10 | 3357814 akak
akak's picture

Ron forgot to mention silver, too.

;-)

Thu, 03/21/2013 - 14:39 | 3358383 SAT 800
SAT 800's picture

That;s alright. Silver is like the US Naval Research Laboratories which actually invented Radar and then let the British have all the notoriety they could collect, as the "inventors". Silver is a part of reality; it doesn't need a cheering section.

Thu, 03/21/2013 - 13:12 | 3357844 TerminalDebt
TerminalDebt's picture

and bitcoins

he should have asked the bernank if bitcoins is money.

Thu, 03/21/2013 - 13:41 | 3358048 Confused
Confused's picture

Alot of talk about bitcoin today.

 

So a question for all those who support it. What makes you think the individuals gaming the markets (so same HFT boxes) are not currently also gaming bitcoin?

Thu, 03/21/2013 - 14:23 | 3358306 Prisoners_dilemna
Prisoners_dilemna's picture

I would respectfully answer with a question of my own.
Is there anyone currently manipulating BTC and if so how?

We can rule out sky net as there aren't any BTC paper markets yet. I'm not saying there can't be in the future... But right now a paper BTC market just doesn't exist. So we can rule that out.

The source code is open source and forums exist where legions of computer afficionados discuss potential threats and solutions to BTC. So right now we can rule out back door or counterfeit bitcoins. Although I would go further and suggest it will never be possible to counterfeit BTC. But that's besides the point.

Some detractors have suggested B.S. Bernanke can print and buy all the BTC. This is the most plausible as the USD price is ramping to the exit sign. However an earlier article demonstrated thru google trends that BTC is being adopted globally but especially rapidly in Spain right now. So we really can't say conclusively whether the buying is a mefarious plot or legitimate demand from concerned citizens.

Ummmm hit me back and maybe I can suggest some other scenarios.

Thu, 03/21/2013 - 14:58 | 3358537 granolageek
granolageek's picture

I've seen speculation that Mt Gox can be manipulated with as little as $100k. No one questions that a million USD could make the price dance a jig.

 

You can't play paper games, but the float is so small that the market can be cornered. Some of the early adopters have tens of thousands of them, but they're generaly planning to hold until they're richer than $2 million or so.

Thu, 03/21/2013 - 13:24 | 3357934 akak
akak's picture

Allow me to use BernakQE logic to answer that question:

 

If gold is just a tradition,

And gold is not money,

And bitcoins are not a tradition,

Then bitcoins are money.

QED

Thu, 03/21/2013 - 13:08 | 3357810 pmm009
pmm009's picture

PURE B.S.!!!!

Cyprus banks have been offering interest rates on deposits greater than 15 thousand Euros that in many cases are hundreds of percent greater than what can be made in America or UK.

These banks were running a Ponzi.  Offering someone 4% and taking the money and investing in EU Sovereigns, like Greece, is not a prudent business model.  How did these depositors think the banks were going to offer these rates?  Bankers are not Hedge Fund managers.  Any banker who is that good, leaves to work with or for Hedge Funds. 

Cyprus politicians need to tell the common people of Cyprus the Truth.  If the country leaves the EU, they will loose a third of their purchasing power almost immediately.  If they stay in the EU, they have a much better chance of monetizing the Gas fields for the betterment of the Common people of Cyprus.  If they leave, Russia, China and maybe US-UK-NOR firms will take the lions share.

SIMPLE SOLUTION:

All deposits above 15,000 Euros gets taxed by 5.9%.  All deposits above 100,000 Euros gets taxed 9.9%.   All deposits above 500,000 Euros gets taxed at 14.9%.  THIS WILL RAISE ALMOST EXACTLY 5.77 Billion Euros.

What % of the local population has more than $20,000 US in a bank account in Cyprus?  A would bet it is less than 10%, maybe less than 5%.  THESE ARE THE PEOPLE THAT SHOULD HAVE KNOWN BETTER AND SHOULD HAVE PREVENTED THEIR COUNTRY FROM BECOMING A BANK HAVEN FOR HOT RUSSIAN MONEY.  THESE ARE ALSO THE PEOPLE WHOSE PROPERTY VALUES SOARED DUE TO THE HOT MONEY.

IF THE POLITICIANS DON'T COME OUT AND EXPLAIN HOW THEY ARE PROTECTING THE LITTLE GUY AND EVERYONE ELSE NEEDS TO BITE THE BULLET FOR NATIONAL UNITY & PRIDE THEY ARE NOT WORTH A DIME.

The Russians and Brits, etc. who get a haircut will breath a sigh of relief knowing it could have been much worse.  They may move their money, but Cyprus is going to have to change their banking sector in any case ( and this means offering less interest on insured deposits ) so some money will leave anyway. 

Gold can be confiscated just like Fiat and it is much harder to fly into NY or London or Nice or Hong Kong and throw a bender buying bling to Bit....

Thu, 03/21/2013 - 14:24 | 3358313 Clowns on Acid
Clowns on Acid's picture

Very cobwebbed thinking man.... you are living in the past gilded age.

Get with the new barbarism, you just might survive.

Thu, 03/21/2013 - 14:24 | 3358311 Quinvarius
Quinvarius's picture

I think you are just upset because as the people that understand gold have been telling you, they will confiscate your paper wealth to include money, bonds, and stock certificates. 

Thu, 03/21/2013 - 13:42 | 3358061 dumpster
dumpster's picture

more brain dead analysis on gold .. pmm .. what are you wearing now .. training diapers

 

Thu, 03/21/2013 - 14:00 | 3358172 pmm009
pmm009's picture

you itiot, the situation in Cyprus has nothing to do with gold.  Gold is great, like any other investment, if you buy it dirt cheap and hold it.  Unless some bank or island allows you to collateralize a checkable bank account with bars stored in their basement it doesn't help the fast money crowd.  Oh, and they need to offer you 4-5% annualized returns on you guaranteed deposits.  Good Luck.  Money is in Cyprus for the rates, for the convenience, for the tax avoidance. 

Thu, 03/21/2013 - 14:10 | 3358238 ebworthen
ebworthen's picture

You're the kind of person who would sell out their neighbor or own Mother when the stormtroopers came.

"Yes, they're under the kitchen trap door into the basement!  Just don't hurt me and let me keep my house!"

Weasel.

Thu, 03/21/2013 - 13:28 | 3357974 They Tried to S...
They Tried to Steal My Gold's picture

 I have transfered your name and message to Putin and the Cypriot citizens........

 

Best of Luck

Thu, 03/21/2013 - 13:22 | 3357917 laomei
laomei's picture

Better idea: confiscate 100% of all non-resident EU accounts.  There, that's 18b and they don't need a bailout anymore.

Thu, 03/21/2013 - 13:21 | 3357912 LawsofPhysics
LawsofPhysics's picture

"Gold can be confiscated" - Theoretically, many things can happen.  Big fucking difference between theory and practice.

Thu, 03/21/2013 - 14:16 | 3358274 zjxn06
zjxn06's picture

"Gold can be confiscated"

Question Fiat for $500:

What's easier, confiscating gold from safe deposit box safe basement back yard lake bottom, OR confiscation of cash from checking, savings IRA, 401 (k), brokerage accounts?

 

Thu, 03/21/2013 - 15:55 | 3358886 kito
kito's picture

yeah zjxn06, the 401k route is cleaner, but then again........what would be the fun in the DHS have trillions of bullets and not being able to USE them???????..............................

Thu, 03/21/2013 - 14:49 | 3358451 Lugnut
Lugnut's picture

I suppose it depends on whether your a robber on a home invasion, or a bankster. Slim distinction I know....

Thu, 03/21/2013 - 13:11 | 3357829 akak
akak's picture

Mario, is that you?

Thu, 03/21/2013 - 13:40 | 3358037 web bot
web bot's picture

No Mr. A.... it's Leo...  :)

Thu, 03/21/2013 - 14:11 | 3358245 akak
akak's picture

Well, he did at least show up around lunchtime.

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