The gold market price has been acting very strangely of late. Posted by James Randolph on October 26, 2011
What to make of current gold market prices.
October 26, 2011 – The gold market price has been acting very strangely of late. For the most part it remains almost flat, but then on Tuesday is jumped up $40 in just 2 hours and then leveled off again. What’s that about?
Actually, trying to make sense out of any market prices these days will serve only to make your brain hurt. All of these short-term gyrations are the result of a basis of exchange that has gone absolutely haywire. How can you fix a price when you can’t determine the value of a currency?
Thanks to the wisdom of central bankers everywhere, that situation will soon be resolved. Even Japan has its finger on the printing press once again. And “Federal Reserve Vice Chairman Janet Yellen said a third round of large-scale securities purchases might become warranted if necessary to boost a U.S. economy challenged by unemployment and financial turmoil,” says Bloomberg.
Meanwhile CNBC reports that “the nonprofit State Budget Solutions … found that in total, states are in debt for $4.2 trillion,” adding an enormous – and insurmountable – amount to our total sovereign debt.
As for the national debt, the much heralded Deficit Commission is locked in a Mexican standoff. The Republicans have pledged not to raise taxes and the Democrats will surely use that to prevent any cuts to entitlements.
So we sink ever deeper into debt while the politicians play games and the Fed bumbles about printing more greenbacks. If you see a solution in that, please step back through the looking glass.
The free market may look like it has thrown in the towel, but don’t bet on it. Once the governments have diluted fiat money to worthlessness there will be no choice but to return to hard currency.
You will see the signs in gold market prices.
Senior Staff Writer – Certified Gold Exchange