A False Requiem For Gold And Silver

SOURCE:[James West] – There are so many people who just wish gold and silver would be recognized for what they are – shiny pieces of dirt – and stop attributing so much false value to them. And they’re some arguably pretty respectable people. Jeffrey Currie, head of commodities at Goldman Sachs, could be said to be the ‘ringleader’. His very public campaign to exert his influence to manipulate investor sentiment downward has been a success for Goldman Sachs, even while the SEC conveniently turns a blind eye to such blatant market manipulation.

Increasingly, investor disdain for gold is spread by the heavy bias in mainstream financial media toward anti-gold coverage as opposed to pro-gold coverage, which is limited to independent and fringe publications.

Is it perhaps time to concede, among the metal monetarists out there, that gold and silver, could in fact, be made obsolete by a combined social and cultural psychological revolt against the idea of gold and silver’s intrinsic value? Is it not conceivable that the lunacy inherent in the idea of any metals being precious be on par with the lunacy of suggesting the earth is flat?

I, for one, am beginning to wonder. The human capacity for willful disbelief, exemplified by circumstances such as Malaysian Airways Flight MH 370, where the bereaved relatives refused to accept that the plane and all aboard were lost, extends to the financial realm. Human beings tend to align their most heartfelt beliefs alongside their interests. He who has no gold cares not for its price.

Human beings are also terminally horrible students of history.

Stock memes of gold and silver monetarists such as “Every fiat currency in the history of mankind has failed,” and “gold has been the ultimate store of value for 5,000 years” are meaningless to a generation immersed in Justin Bieber’s behaviour and Rob Ford’s antics. That deficiency, too, extends to the financial realm, where portfolio managers who are proven right by eschewing gold for technology stocks in 5 year windows smugly dismiss gold’s relevance.

Let’s face it: gold and silver investors have hardly had any cause for celebration lately. At least, that is the case if you adhere to the performance short-sightedness that is apparently in vogue this generation.

If one were to take the longer view – say, ten year increments – then a gold bullion investor would still be a happy, if not a little nervous, investor. Ten years ago today the price of gold was right around the $400 per ounce mark. $100,000 spent on gold then would today be worth over $300,000, a return of 300%. The S&P 500 in the same time frame has appreciated by roughly 80%. The Dow Jones, ~57%.

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A False Requiem For Gold And Silver

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