Yesterday was a day of investment banks attempting to scare the holders of gold, silver, and related stocks into submission. Why would the Federal Reserve target such a small aspect of the financial system? It is simple. The price of gold determines the health of the U.S. Dollar. In the short term the Fed can manipulate the price in hope of the public giving up on holding it as insurance against future chaos. The problem is that gold is a global market and the Fed is not infinitely powerful though they seem to act like it at times.
What do David Stockman and Paul Craig Roberts have in common? Both are former government officials in the area of Federal finance and both see a dollar collapse coming. Neither are on the payroll of some institution paying them to keep quiet. Both are concerned about our children’s and grandchildren’s future. As the watchmen on the wall continue to cry out the Fed will continue to pull out all stops in attempting to keep the Titanic from sinking. They will continue to fund investment banks for the purpose of pushing down gold, silver, and related stocks in the paper market by selling short. This will only serve to cause the greatest short squeeze in financial history. When this happens, the fat lady will be hitting the highest of notes and it will be deafening.
I have been putting my money where my mouth is. Yesterday, I added to one of my stock positions with what little extra cash I had. This stock was a screaming buy. You must remember that when someone is selling in a down market, someone else is buying. I am sure China and Russia are giddy about the price of gold dipping under $1,600 so they can add to their stockpiles with the devaluing dollars they are holding. The Fed’s “Hail Mary” pass will be seen as the last great act of desperation before a new currency comes on the scene, whether it be backed by man or Our Heavenly Father.