Friday, November 7, 2008

The Rocks and Stones Will Cry Out

In a previous post, I questioned why the "spot" prices of gold are so low. From what I understand, it is rare in the post-gold-standard period for the stock market and gold to fall in unison for any significant amount of time. In that post, I had even wondered whether the gold market (spot) prices were being artificially manipulated.

Last night I happened upon a May 2007 article by Hugo Salinas Price, President of the Mexican Civic Association Pro Silver. I know nothing of Price--except what is said of him on this website:
"Hugo Salinas Price, 75, is a retired businessman who lives in Mexico. He has been a follower of the Austrian School of Economics since his youth."
If you don't know what he means by "the Austrian School" then you'll just have to take my word for it: It's good. It means he's thinking logically. [For my Reformed Baptist friends out there, you might think of "Austrian" being to economics what "Reformed" is to theology.]

In the aforementioned article, Price demonstrates that the vast majority of gold is owned by private citizens--not by governments. He also speculates that the reason the spot prices are so low is artificial manipulation by the governments and that they are trying to prop up their fiat currencies by making it look like it is holding its ground against real, valuable, God-given money.

Here's the bottom line from the article:
[CB = Central Bank, IMF = International Monetary Fund]

Ownership of world gold:

CBs and IMF: 8.65 % of world gold stock

Private hands: 91.35% of world gold stock.

A dark shadow lies over the reported gold stocks of 28,853 tonnes as of 2007. These include 8,117 tonnes of US gold which the Treasury says are in “Deep Storage”. A most unusual and evasive categorization of gold! There are doubts regarding CB gold. Do they have what they say they have? Is there any gold at all left in US gold reserves?

Let’s put it this way: who has been judging correctly with regard to the wisdom of owning gold - a few dozen Central Bankers and Treasury chiefs, or millions of human beings around the globe? The collective wisdom of mankind has always held gold in high regard; surely it will continue to do so until the end of time. The few dozen arrogant men who think that this collective wisdom can and should be wiped out, are fighting the wishes of humanity and will have to fail in their efforts, simply because the IMF figures tell us that if they insist on being stubborn about not allowing the price of gold to rise and persisting in the sale of Central Bank gold, they will end up with no gold to sell.
Even gold and silver--directly created "fiat" (out of nothing) by God Himself with properties which make them ideal money--are Corruptible Things and will one day pass away. How much longer can the virtual, pseudo-creations of a "few dozen arrogant men" last?

The evil plans of evil men will come to nothing. If economic laws have been broken, then we should expect that justice will not sleep forever. The rocks and stones (i.e., gold and silver) will cry out*.

*Disclaimer: No, I am not suggesting that the fall of the US dollar is the the fulfillment of Biblical prophecy... I was just drawing an analogy. Hopefully I'll have opportunity soon to post about money in the Bible. Right now I have to quickly get to work and earn some fiat money... while there are still some people around who will trade it for real money. :-)

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