Gold Editorials & Commentary

Dedicated to the Memory of Ferdinand Lips (1931-2005)

Student and Advocate of the Gold Standard

On the Occasion of the Inauguration of Gold Standard University Live*

Those of us in the older generation remember the 1970s. It was a wonderful time (for gold bugs). Gold went up. Almost all commodities went up. Bonds went down. Stocks went down. By 1980, most of the top mutual funds were gold funds.

It is a well known fact that the powers that be, want America to partake in a 'one world' system, and this has never been a political teaching or campaign speech by either Democrats or Republicans.

First Majestic, (FR.V - TSX, FMJRF on the pink sheets and AOLHKJ at Frankfurt), is a well managed silver miner, intending on becoming a senior producer through acquisitions and by adding reserves via the drill bit.

A very significant development occurred this week in the resource sectors of energy and metals, which could affect price action in coming weeks.

Long ago - so long ago that I can no longer remember exactly when - I heard the expression "an ant's eye view of the Universe".

I've been reading a book again, which I have had for at least five years. It is copyrighted in 2001, and titled "The Coming Collapse of China," by Gordon Chang.

THIS TIME ITS DIFFERENT

1929-30 = 1972-1973 = 1999-2000 = 2006-2007

The real currency story in recent months is the euro-yen cross, and not so much the euro-dollar headline breakout. In Japanese yen terms, the euro is on a tear. Aiding the euro is significant Asian diversification away from the USDollar by their central banks.

This week, in what I believe to be an unprecedented diplomatic pilgrimage, the sitting U.S. Secretary of the Treasury and the Chairman of the Federal Reserve were dispatched to China.

History replaying

Although gold has not exactly glittered since it broke out of its large triangular pattern late in October, immediate downside now looks limited, while upside remains relatively unlimited.

Life is full of decisions to make. No matter what the situation is, be it serious, comical, or dire, there's always a decision to make as to what to do to remedy or solve a problem. Examples are myriad.

US Treasury Secy Hank Paulson and USFed Chairman have embarked upon yet another trip to China, joined even by Commerce Secy Gutierrez. This Strategic Economic Dialog between the Untied States and China deserves comment.

Its amazing how one thing leads to another. For the past few months I have been writing a novel (nearing completion) and have not been following the markets particularly closely.

This week, both the $HUI and $XAU's weekly charts have confirmed a major buy signal.

Given that foreigners are the primary purchasers of US Treasury bonds (snapping up 56% of inventory in the last auction), a declining dollar is supposed to be a major drag on bond prices.

A steady, relentless, and nearly perpetual force pushing the USDollar down in the next two years will be the housing bear market.

Don't stop me, I'm on a roll. First of all, I always write in the front of books I read, giving my opinion about it. I have a book titled "Bankruptcy 1995." It was published in 1992, and I read it in 1993.

I was in Chicago on November 17 to address the MBA class of 2007 at the University of Chicago Graduate School of Business.

Gloom and Doom? Maybe. I have heard it and felt it before. Allow me to remember…possibly for everyone's benefit. Remember, I have been doing this since 1977, so I have seen and felt them both before.

Don't look now, but a new emergent monster is growing, this one a close cousin to the trade gap.

The year was 1944. For the first time in modern history, an international agreement was reached to govern monetary policy among nations.

It never ceases to amaze how televised media reports on the U.S. economy are almost exclusively about shopping. Such reports almost always feature images of sales clerks frantically stocking shelves and long lines of consumers swiping their credit cards.

The dollar plunged with startling ferocity late last week, driven by heavy selling. This was very bearish action that signals panic, and the probable onset of a severe downtrend.

Gold Update IX indicated that there was a high probability that the 5 month correction in the gold price finished at the $560.7 London PM fixing on Friday 6 October 2006. That is exactly what happened.

To listen to the Bears over the past few years, you would have thought we would all be in breadlines and soup kitchens by now. So far, all of the ranting about doom and gloom sounds more like the boy who cried wolf than accurate forecasting.

While Americans were busy digesting their Thanksgiving feasts, the rest of the world was barfing up dollars. As a result of our massive trade deficits, foreigners certainly have their bellies full of them.

THE INTEREST RATE CONUNDRUN