WSJ's One-Two Gold Punch

Having known that the full-page ad from GATA (Gold Anti- Trust Action Committee) would appear in the Wall Street Journal, it was a pleasant surprise to also see the lead story on the front page of the world's most popular business daily on a similar topic (see Page A1 - Investors Rush to Gold($)).

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Not being a "newspaper man" (does anyone still use that term?) it's not entirely clear which of the two stories above is the lead story, but, being a left-to-right kind of reader, my eyes finished with "Fed Moves to Curb Risk of Deflation", did a carriage return, and promptly started reading a story about gold by E.S. Browning.

The report on the half-point interest rate cut by the Federal Reserve is on the right (haven't gotten to that one yet), but the graphic in the middle is about gold - maybe the editors at the WSJ are trying to subtly tell their readers something.

Here's an excerpt from what is a very favorable story on the yellow metal (note to the Personal Finance Section writers of How to Survive the New Gold Rush - get a clue!):

The precious metal has been a horrible hedge against inflation. To keep pace with inflation going back to 1980, gold futures would need to be above $2,228 today. Believers see that as a sign that gold has a lot of room to rise, and predict it will surpass the $1,000 mark this year.
...
One advantage of gold, says Marc Stern, chief investment officer of Bessemer Trust, a New York institution that oversees $52 billion for wealthy families, is that it isn't regulated by any central banker who might be tempted to print money and thus debase its value. "Gold doesn't have a policy, gold doesn't have a central banker, gold doesn't have a printing press," he says, adding, "It is a form of insurance."

While the main story is behind the subscription wall, the cool interactive graphic on the gold price is in the public area at the WSJ Online.

The GATA ad along with supporting documentation is worthy of a close look as well - these folks have worked tirelessly over many years to draw attention to the plight of the world's oldest money in a world full of paper money.

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Recent events, not the least of which is the one-two punch in what is, by far, the world's best business news publication, may cause millions of eyebrows to be raised and thousands of investment advisors to see the yellow metal in a new light.

See the GATA website for more details on the ad.

Comments

[drbagel]

Or maybe this is the kiss of death. Gold is now firmly in the main stream. Perhaps a front page article in the WSJ represents a top.

2008 Feb 04 10:26 AM

[jaycey]

Anybody interested in the gold market needs to read Sterling and Peggy Seagrave's <i>Gold Warriors</i>. Nobody knows how much gold there is in the world and there seems to be a lot of "black" gold floating around out there (and I don't mean oil). Here's a short exerpt:

"Official records maintain that Asia, with more than 75% of the world's population, holds less than 5% of the total world supply of gold, a statistic that is ridiculous on the face of it. ... nobody really knows how much gold there is. We do not know how much was looted by Spain from the New World, because once it reached Europe most of it was passed on to the great European banking families, the Fuggers and Welsers, who had financed the conquest of Mexico and Peru. Whatever the Fuggers and the Welsers did with that gold they kept very secret. We also have no way of knowing the actual wealth of families like the Krupps, Rothschilds, Oppenheimers, Warburgs, or Rockefellers, except that they have been very rich for a very long time and their wealth is dispersed in a multitude of clever ways. A trillion dollars sounds like a lot, but economists tell us that today there is some $23-trillion in the hands of the well-heeled, much of it sleeping in offshore private accounts where banking secrecy and local laws keep these assets hidden from the tax-man, spouses, and clients. We know even less about the gold holdings of the great Asian and Middle Eastern dynastic families, trading networks, and underworld syndicates. Western tycoons may own banks and oil companies, and influence or control governments, but wealthy Asians never trusted governments or banks, preferring to keep their wealth in small gold or platinum bars, and gems. In China this absolute distrust goes back thousands of years. We can be sure that what was tucked under the rug in Asia over 2,000 years is far more than what has been deposited in U.S. and European banks since Western banking (and the gold market as we know it) came into existence barely three centuries ago. The U.S. Government refuses to disclose how much gold it holds, and the last public audit of Ft. Knox was in the early 1950's. In short, gold is one of the world's biggest secrets." [p 9-10]

An excellent read and a real eye opener!

2008 Feb 05 04:59 PM