Why Gold Will Prevail

Posted In: Central Banks, Commodities, Currencies, Dollar, Federal Reserve, Gold, U.S. Government

This afternoon, I listened to the most recent broadcast of the “Financial Sense Newshour” when guest John Williams of “Shadow Government Statistics” fame made the following statement about the recent activity surrounding gold:

I can’t prove that intervention took place in the gold market. But you sure can make a very strong circumstantial evidence case for it, especially considering that the system was on the brink and they were trying to contain the panic. One way to do it is to discourage the owning of gold. And that’s been a traditional sore point for central banks and governments over time. It’s usually when gold is soaring it’s a good sign that they’ve been doing a bad job. And I think a lot of what happened with that, not only the selling of the gold, but the buying of the dollar, was very much orchestrated, very much supported with heavy intervention. Again, the underlying fundamentals haven’t change a bit. If anything, they’ve gotten worse. And the fundamentals for the dollar couldn’t be more negative. And the fundamentals for gold couldn’t be more positive. And those fundamentals, will in the end, dominate the markets. And, irrespective of whatever intervention, games-playing, jawboning, whatever’s done, in the end the gold price will prevail on the upside. And, unfortunately, for most of us living in the United States, the dollar is going to come under very heavy selling pressure.