Why does the “Paper Gold” Price Track the Physical Gold Price?
It’s curious, isn’t it? So-called “paper gold” (a futures contract) has a price that is not only very close to physical gold, but it remains locked to it. This is despite the fact that “paper gold” is...
View ArticleFour-Letter “G” Word Discussed on TV
The title of the video clip under review and subject of their discussion is: “Would returning to the gold standard end currency wars?” Obviously, countries which use gold as money would have to...
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Gold Leaps Into Backwardation!
Since late January, the February gold contract has been in backwardation. This means that one could make a profit by simultaneously selling a gold bar and buying a February contract. One would still...
View ArticleUnadulterated Gold Standard Part V (Real Bills)
In Part I, we looked at the period prior to and during the time of what we now call the Classical Gold Standard. It should be underscored that it worked pretty darned well. Under this standard, the...
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The Curious Case of Falling Gold and Silver Prices
A curious thing happened last week. The prices of both monetary metals have been falling for a week and a half through February 15. No, that’s not the curious part. There is no law of nature that says...
View ArticleWhat Drives the Price of Gold and Silver?
If there is a credible rumor that the Fed is planning to further extend its “Quantitative Easing”, how would you expect the monetary metals to react? Typically, the gold price would rise and the silver...
View ArticleThe 10 Minute Gold Standard
Far too many people believe that gold serves no useful purpose. I am therefore publishing this response to The 10 Minute Gold Standard: It’s Much Easier than You Think by Nathan Lewis. Mr. Lewis, a...
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Gold Caught With Its Backwardation Showing
With all the discussion on the Internet, some of it confusing, we thought a picture would be worth a thousand words.Backwardation is when there is a profit to decarry the metal. This is the...
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Bitcoin Crashed. Again.
When writing about economics (as opposed to trading), one does not expect to be proven right within days of publishing something. Things can take years to play out. On Monday, February 25, we published...
View ArticleCyprus Targets Its Savers in Bailout Agreement
After markets closed on Friday, it was announced that Cyprus worked out a deal with the European Central Bank, European Commission, and the International Monetary Fund (“the Troika”). Here is a...
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Cyprus Forced Into Bailout Deal
Do you think that depositors in Cyprus are being taxed? That their money is being taken from them to go to the government in Cyprus or to Europe? Most analysis of the Cyprus bailout is wrong on this...
View ArticleCyprus Collapse Triggers Unintended Consequences
Some people believe that by imposing losses on investors and reducing the Cyprus banking system liabilities, the European powers have addressed the problems in Cyprus (if harshly). Others think that it...
View ArticleGold, Redeemability, Bitcoin, and Backwardation
I recently released a video about the Internet-based currency, Bitcoin. I asked the question: is Bitcoin money? In brief, I said no it’s an irredeemable currency. This generated some controversy in...
View ArticleIn Irredeemable Paper Money, Savings Is an Illusion
The government bond is defined as the "risk free asset" by modern portfolio theory and by regulation. No theory and no law can make it so. But in the meantime, the savings of the people is going into...
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What Is Pushing Down the Gold Price?
It has been an increasingly brutal ride for gold and silver, beginning around late March and accelerating through April. The gold price was over $1600 and on Monday April 15, it fell below $1350, a...
View ArticleSilver Scarcity
After my last article, What Is Pushing Down the Price of Gold?, I got a lot of feedback from readers that many coin shops are reluctant to sell or have stopped selling gold and especially silver. The...
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Gold Basis Report RE: Silver "Smashdown"
The “coordinated smashdown of gold and silver” was on everyone’s mind this week, but is it true? Did the price of paper gold (futures) divorce from the price of physical gold? One thing is for sure,...
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The Gold Futures Open Interest Caper
In the recent Gold Basis Report, we published a graph showing the open interest in gold and silver futures (i.e. the number of contracts held at any given time). At the time of the crash and in...
View ArticleHow Not to Trade the Dollar
I hope this essay provides some food for thought. It is not my intention to insult or belittle anyone, but using humor and cold logic, to help people understand an abstract topic with many...
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The Dollar is Going Up
Let’s take a look at a few graphs of the dollar, from Feb 1, 2013 through Friday May 17, 2013. Yes, I said graphs of the dollar. I’ve priced the dollar in gold first (of course), then silver, the euro,...
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