I also spent part of the weekend gaming plausible scenarios of government intervention in the gold market. Paul Volker allowed in a speech the other day that he “thinks repeat thinks that capitalism will survive, in most respects.” That’s reassuring! He went on stating that he never gave much thought to the center of capitalism and its relation to society! For God’s sake, what kind of ideas are they putting into poor old Paul’s head?? I am happy to report that he did not look like he was being held hostage.While he is probably used for mostly figurehead value, and is not privy to inner circle plans, it is possible to make some inferences. These big government, government is good academy guys have American Captialism right in their crosshairs and they are discussing all of the possibilities. They have big plans and it includes the markets. As the price of gold heads north, it will become symbolic of the inability of the policymakers to get a handle on the present malaise. For this reason alone, and they have other motives, they will intervene.
By this stage of the game, after the dot com bubble, credit bubble, housing bubble, telecom bubble etc etc even the most obtuse legislator on those congressional committees is aware that bubbles exist, and he also has a vague notion that they are bad. All the policy guys have to do is paint gold as a bubble, and they will have no problem with congress. Maybe they will coordinate with other countries to start liquidating reserves at a certain price level. Hey, it would give them cash for another stimulus! Or they might steal a page from the FDR playbook and just stop trading. I can think of other scenarios, however, imho when/if the gold market gains real momentum, these guys will intervene big time.
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Hi
I’m just an amateur investor here in South Africa. Been following your commentary for years…..brilliant stuff! I’ve been “advertising” your website here for years and must say you have quite a local following now. Thought I’d add my latest commentary which I write every 2 months or so and see what you pro’s think….
http://blogspace.mweb.co.za/DesktopModules/MIH/Blog/BlogView.aspx?tabID=0&alias=dinen&ItemID=73725&mid=89717
So there you have it, Dinen’s global solution….now go and give it to the powers that be so that a difference can be made before it’s too late!
Dinen P Maharaj
eec@mweb.co.za
17 February 2009
I also spent part of the weekend gaming plausible scenarios of government intervention in the gold market. Paul Volker allowed in a speech the other day that he “thinks repeat thinks that capitalism will survive, in most respects.” That’s reassuring! He went on stating that he never gave much thought to the center of capitalism and its relation to society! For God’s sake, what kind of ideas are they putting into poor old Paul’s head?? I am happy to report that he did not look like he was being held hostage.While he is probably used for mostly figurehead value, and is not privy to inner circle plans, it is possible to make some inferences. These big government, government is good academy guys have American Captialism right in their crosshairs and they are discussing all of the possibilities. They have big plans and it includes the markets. As the price of gold heads north, it will become symbolic of the inability of the policymakers to get a handle on the present malaise. For this reason alone, and they have other motives, they will intervene.
By this stage of the game, after the dot com bubble, credit bubble, housing bubble, telecom bubble etc etc even the most obtuse legislator on those congressional committees is aware that bubbles exist, and he also has a vague notion that they are bad. All the policy guys have to do is paint gold as a bubble, and they will have no problem with congress. Maybe they will coordinate with other countries to start liquidating reserves at a certain price level. Hey, it would give them cash for another stimulus! Or they might steal a page from the FDR playbook and just stop trading. I can think of other scenarios, however, imho when/if the gold market gains real momentum, these guys will intervene big time.
Let the fragging begin!