RWSchilz
September 21st, 2007, 03:15 PM
Last night, on CNBC, Larry Kudlow suggested that the price of gold is pointing to inflation. (Incidentally, I now call him “Notradarmus” Kudlow, following his brilliant “50 and 50” Fed rate call -- 100 percent better than my call of a grudging “25 and 25” cut).
I almost fell off my chair -- as we have long argued as to the “true” level of inflation. Having recovered myself, I replied that gold was “shouting” inflation and dollar crisis. I should have said “roaring” and added “stagflation”, but it would have complicated matters too much for a sound bite debate.
Here, we should point out that the price of Gold does not reflect a true “free” market. It reflects a “dirty” market, heavily distorted to the downside by coordinated central bank sales, designed to “demonetize” nature’s natural money. So the “shout” of gold is being heavily muffled by central banks. The realty is that the price of gold is “roaring” alarm!
We see two major threats facing our Fed -- stagflation and panic. They both have their roots in the “Great Inflation Lie”, of which we have long warned.
Both, are now being manifested in a dollar rout!
As we said yesterday, every man, woman and child in America will now have to pay the price of the Fed rate cut. We are now all “down on the floor” [as in the E-Trade ad.] as we are robbed, by hourly depreciation of our dollars, not by our local bank, but by our Fed!
In April, we devoted our issue of Financial Intelligence Report to the issue of stagflation. We now think the Fed sees stagflation staring it in the face.
Until now, we have held off talking about panic, for fear that the very mention of the word, might lead to one. But on Tuesday, our Fed (FOMC) sat down facing that day’s New York Times cover photograph of a run on a British bank (Northern Rock), caught in the sub-prime contagion ripple, of which we had warned.
Following the lead of the New York Times, we now feel free to at least discuss the risk of panic.
We believe that we face not one, but three main types of panic and that the rise in the price of gold is, in part, reflecting two of them.
The first and most obvious potential panic is about the recent Fed Rate cut, leading to a run on the U.S. dollar.
http://www.newsmax.com/headlines/Fed_Cut_dollar/2007/09/21/34664.html
I almost fell off my chair -- as we have long argued as to the “true” level of inflation. Having recovered myself, I replied that gold was “shouting” inflation and dollar crisis. I should have said “roaring” and added “stagflation”, but it would have complicated matters too much for a sound bite debate.
Here, we should point out that the price of Gold does not reflect a true “free” market. It reflects a “dirty” market, heavily distorted to the downside by coordinated central bank sales, designed to “demonetize” nature’s natural money. So the “shout” of gold is being heavily muffled by central banks. The realty is that the price of gold is “roaring” alarm!
We see two major threats facing our Fed -- stagflation and panic. They both have their roots in the “Great Inflation Lie”, of which we have long warned.
Both, are now being manifested in a dollar rout!
As we said yesterday, every man, woman and child in America will now have to pay the price of the Fed rate cut. We are now all “down on the floor” [as in the E-Trade ad.] as we are robbed, by hourly depreciation of our dollars, not by our local bank, but by our Fed!
In April, we devoted our issue of Financial Intelligence Report to the issue of stagflation. We now think the Fed sees stagflation staring it in the face.
Until now, we have held off talking about panic, for fear that the very mention of the word, might lead to one. But on Tuesday, our Fed (FOMC) sat down facing that day’s New York Times cover photograph of a run on a British bank (Northern Rock), caught in the sub-prime contagion ripple, of which we had warned.
Following the lead of the New York Times, we now feel free to at least discuss the risk of panic.
We believe that we face not one, but three main types of panic and that the rise in the price of gold is, in part, reflecting two of them.
The first and most obvious potential panic is about the recent Fed Rate cut, leading to a run on the U.S. dollar.
http://www.newsmax.com/headlines/Fed_Cut_dollar/2007/09/21/34664.html