The Bubble is in Currencies

GoldMoney founder and GATA consultant James Turk today tells King World News that the bubble of the moment is in national currencies, that gold already has seen its lows for the year, and that gold mining shares are as low relative to the gold price as they were during the Lehman-induced market plunge three years ago.  To protect themselves from the coming collapse, investors need to own physical gold and silver as well as other tangible assets that make sense, like farmland, mines, oil related assets, etc..  These are the things people will need regardless of what happens in financial markets.  So in his view, investors should continue to stay away from financial assets and the promises in which they rest.  An excerpt from the interview is posted at the King World News blog here:  James Turk Interview

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  1. #1 by Stan on January 17, 2012 - 5:44 am

    What an interesting – and reasonable – way of looking at it. Everyone’s been talking about whether gold or silver are in a bubble that’s about to burst. When in fact, it’s the fiat paper or Fed currency that’s ballooned so grotesquely that we can’t recognize a US Dollar for what it used to be.

    I just bought some “junk” silver coins on ebay – 4 silver quarters and 8 silver dimes (1964 and earlier). $1.80 in US coins now sells at public auction on the Internet for over $40. A silver dollar of no special value to a coin collector is worth a minimum at auction of $25 in today’s paper currency, based on it containing 90% silver. In other words, it takes over 25 new dollars to equal one ‘old’ dollar. Now, tell me what’s in a bubble. I say the bloated new dollars.

    • #2 by carmenalexe on January 17, 2012 - 3:45 pm

      Stan, i agree with you. Think about this. Not long ago when everyone was buying real estate (during the boom) most of America was busy thinking they were rich, they weren’t thinking a bubble was being inflated in real estate. Today, we have bailouts of corporations and sovereigns, these bailouts are not occurring with gold but with paper money. If one was to pay attention he’d see that there is an artificial demand created for fiat. Therefore it makes sense to conclude that one day this bubble will burst.

      • #3 by Stan on January 17, 2012 - 6:05 pm

        My own mental picture is a money supply that keeps increasing and increasing. The fiat currency supply is bloating so grotesquely that it’s stretching out of belief. Trillions and trillions of dollars of new, phony money. Nearly all of that, of course, is electronic, created as computer entries. How much paper and ink it would take to print that many $20 and $100 bills is incredible. I don’t think there’s enough gold in the universe to back that much currency. It can’t help but fail. And what an implosion it’s going to be!

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