The powers that be are doing everything in their power to surpress the price of gold. They use the corrupt derivatives market to push the price down. But they can’t do it forever. Supply and demand always win in the long run. As the supply of paper dollars increases, they become worth less in relation to gold. I’d bet that gold will rise again in 2013 for the 13th year in a row.
“The U.S. gold coverage ratio, which measures the amount of gold on deposit at the Federal Reserve against the total money supply, is currently at an all-time low of 17%. This ratio tends to move dramatically and falls during periods of disinflation or relative price stability. The historical average for the gold coverage ratio is roughly 40%, meaning that the current price of gold would have to more than double to reach the average. The gold coverage ratio has risen above 100% twice during the twentieth century. Were this to happen today, the value of an ounce of gold would exceed $12,000.”
– Scott Minerd – Guggenheim Partners
The fanatics in the Washington establishment don’t get it that Keynesianism does not work. You cannot increase your debts to pay off your debts. You cannot print more money to cure all of the money you’ve printed, and all of this printed money is flooding out all over the world and wreaking havoc everywhere. They are all running the printing presses. Mark my words, if you don’t own gold you will rue the day you decided not to buy it.”