Gold Versus The Dollar

Where to put your money now?

In the dispute between the dollar and gold, says our old friend Lord Rees-Mogg in today’s TIMES of London, “there’s no contest.”

As a store of value, says his lordship, gold is unbeatable . “Even now its purchasing power in terms of physical assets is not far distant from 300 years ago, before Isaac Newton’s recoinage of 1717.”

America has not protected the value of its dollar , says Lord Rees-Mogg. The last American Fed chief who cared about preserving the purchasing power of the dollar was Paul Volcker. He left his post 20 years ago. Since then, the role has been filled by two inflationists – Alan Greenspan and, now, Ben Bernanke. As a result, people try to protect themselves, by buying gold.

“Gold is a defence against inflation. In November the Americas will elect another inflationary president. That will be good for gold, but bad for the dollar.”

Bill Bonner
Markets and Money

Bill Bonner

Bill Bonner

Since founding Agora Inc. in 1979, Bill Bonner has found success and garnered camaraderie in numerous communities and industries. A man of many talents, his entrepreneurial savvy, unique writings, philanthropic undertakings, and preservationist activities have all been recognized and awarded by some of America’s most respected authorities. Along with Addison Wiggin, his friend and colleague, Bill has written two New York Times best-selling books, Financial Reckoning Day and Empire of Debt. Both works have been critically acclaimed internationally. With political journalist Lila Rajiva, he wrote his third New York Times best-selling book, Mobs, Messiahs and Markets, which offers concrete advice on how to avoid the public spectacle of modern finance. Since 1999, Bill has been a daily contributor and the driving force behind Markets and Money.
Bill Bonner

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Gold vs Dollar, there’s no contest, but holding only gold one gets no real rate of return (although a zero real rate of return is much better than a negative one)

I guess gold’s good for now during double-digit inflation, but too conservative for me in the long run.

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