Saturday, June 26, 2010

Central Banks Join the Ranks Of Investors Who Like Gold

Bernanke doesn't understand why there's a rush to buy gold; the establishment whores attack gold and anyone who advocates it. But the central banks, one of which Bernanke chairs and the establishment whores get their marching orders from, are scooping it up like gangbusters.

PS - They'll never go back to a gold standard. Gold is freedom. Gold is sound. Gold is too hard to manipulate, and it can't be inflated. Hell no they won't go back to gold.

    CNBC -

    Is the world going back to a gold standard?

    Not really. But with central banks around the globe holding more gold in reserve, it certainly has people talking.

    Gold coins and bar
    Gold has been rising because of increased demand and decreased supply, U.S. Global Investors' Ralph Aldis said. Although in the past sales by central bankers made up for the difference, nowadays central banks are becoming net buyers.

    “We will see some derivation of a gold standard in the next 5 to 10 years," said Brian Hicks, U.S. Global Investors money manager, in a conference call this week with financial advisors and consultants.

    A true gold standard would mean you could exchange paper notes for a fixed amount of bullion. While Hicks isn't suggesting that, he expects there will be “some percentage, perhaps 20%” of reserves will be in a “basket of currencies”.

    When asked to clarify this comment after the call he added: “We have been seeing baby steps in the direction of countries holding more gold in their official reserves, and that this gold in effect is backing their currency.”

Read it all.