I think US agencies are shorting gold in stock and futures markets -- using near-worthless, fresh printed fiat currency -- to make the Dollar look good.
Reminds me of German currency becoming worthless at the end of World Wars I and II.
Forget the fiat currency stuff. Yeah sure the fed is printing a couple trillion dollars worth of fiat money from NOTHING —but the oil industry byo fraking just created 75-150 trillion dollars worth of oil/gas reserves backing the dollar from NOTHING.
Every year for the last three years the US has produced slightly less than 1 million more barrels@ day of oil. The same thing is going to happen this year. the same thing will happen for each of at least the next five years. The US will become oil independent again for the first time since the 1070’s.
Look at it this way. In 1973 just as the watergate hearings were getting started after nixon was elected to his second term— OPEC had their first OPEC oil embargo. That was a supply shock to the downside.
Now just as Obama’s benghazi/IRS/AP hearings tea off we’re getting a major supply shock to the upside.
On top of that, the US federal budget deficit is shrinking rapidly as more receipts come in. They’re now projected to be something like 650 billion this year. That’s down from over 1 trillion last year. That’s huge. If trends at that rate keep going like that for another two years the federal budget will balance. You just can’t underestimate the power of energy independence.
On top of that Japan is printing money like crazy, the Eurozone is very weak and the Chinese Yuan is well chinese.
There is no other reserve currency with the strength and future of the US dollar.
Here’s the way it works. More oil equals a stronger dollar equals cheaper oil equals weaker gold. The fear factor that the Middle east countries have tried to push into the price oil is steadily weakening as US output increases which makes for more oil price stability followed by price depreciation.
Look at it this way. In 1973 just as the watergate hearings were getting started after nixon was elected to his second term— OPEC had their first OPEC oil embargo. That was a supply shock to the downside.
..................
Think about it. What happened to the price of gold from 1973-1979. The price of gold went to the moon.
We are in precisely the inverse position of 1973.
Gold over the next couple years is going to be hopelessly crushed.
When you see ads for gold on TV —it means just the same as shoe shine boys betting on the stock market. Its a tell.
What it means is get out. Get out. Get out now.