This Is What Gold (Always) Does In a Currency Crisis

From the article:

“It won’t be long before this chart is replicated in a whole lot of other places. But by then it will be too late to prepare. The gold will be gone …”


Russian-gold-price-Dec-2014

This Is What Gold Does In a Currency Crisis (Dollar Collapse, Dec 16, 2014):

To say that gold is in a bear market is to misunderstand both gold and markets. Gold isn’t an investment that goes up and down. It is money in the most basic store-of-value sense. Most of the time it just sits there, and when its price changes in local currency terms that says more about the local currency than about gold.

But when currencies collapse, gold shines.

Consider the above from the point of view of a typical Russian. The ruble is tanking (no need to understand why — all fiat currencies go this way eventually and the proximate cause is almost irrelevant). Russians who trusted their government and kept their savings in, say, a bank account, are losing their shirts. But those who own boring, doesn’t-pay-interest, in-a-bear-market gold have seen their capital appreciate in local currency terms by about 60 percent in just the past month. They’re not “making money,” but they are preserving wealth.

This is how it has gone always and everywhere when governments have destroyed their currencies. In the Roman Empire, revolutionary France, revolutionary America, most of Latin America in the 20th century, and now big parts of the developing world, local currencies evaporate but gold just sits there, buying the same amount of stuff as ever, impervious to the games governments play.

It won’t be long before this chart is replicated in a whole lot of other places. But by then it will be too late to prepare. The gold will be gone and those who trusted their governments will have to make do with promises.

Coming to a country near you soon …

gold-dollar

4 thoughts on “This Is What Gold (Always) Does In a Currency Crisis

  1. In the eras your writer uses as comparison, banks didn’t have such control over the world and its nations. Today, they rule the world.
    The people of the Russian nation are behind Putin. If he is unable to protect them from banker’s games, that tells me the world is screwed, not just Russia.
    I don’t know much about playing with currencies. If I could, I would put my money in Swiss currency, but I could be wrong.
    I do know that Putin has played a very sophisticated economic game with the US, he has undercut the pinning of the US world financial domination…..never again will the dollar rule.
    I cannot help but think he has some plan, and am not ready to sell him short……Russia has been stockpiling gold for years. If he were to come out today and back the Ruble with silver or gold, that would slam the US and the fear mongers.
    Will you have his speech? I will also check with rt.com.

  2. Thanks, much appreciated for the link.
    The fools in the west are really underestimating him, or if not underestimating, they are lying………

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