-- Posted Wednesday, 10 October 2007 | Digg This Article
| Source: GoldSeek.com
George V.P. was the first to send me to Sprott.com, in which the entire commentary contained only two words. On arriving at the site, on the first page, in very large typeface, is written the word "BUY".
I kept looking at it expecting, you know, something to happen. So I sat and waited, patiently staring at the word "BUY", and I waited and looked at this word some more, and nothing happened, and after awhile I started thinking that it looked pretty weird. Maybe it should be pronounced "boo-ee"! What an insight! And so I call my wife over to look at it, and naturally she doesn't think it looks like "boo-ee" at all. So we get into a big fight about it, and about who is REALLY the "weirdest, most stupid lunatic jerk in the whole freaking world" around here, and pretty soon everybody in the office is agreeing with her!
And then they'll turn around this December and wonder why I don't give them a Christmas bonus this year, either!
So I'm naturally thinking, "Eric Sprott and Sasha Solunac are telling me that they also think that 'buy' is a weird word, and that it really IS pronounced 'boo-ee', and everybody has been pronouncing it wrong all this time?
"Or are they telling me to buy something? Buy what?" And then I started thinking of all the things we could buy, like a pizza! And then I am thinking, "And if we could buy a pizza, and if they were going to buy a pizza, how about, you know, getting with the program?"
So I decide to help things along by stealing their identities and one of their credit card numbers, and use it to order a pizza, charging the whole thing to them, which was only fair since it was their idea to have pizza in the first damned place!
So I grab the mouse to start my Internet search, and as I did so, the screen flipped to the second page, whereupon I saw what they wanted me to buy! "GOLD", it read, in big, gold-colored letters, and punctuated by a big, black exclamation point!
Gold!
This is apparently not news to Mark Lundeen, who disdainfully says, "For your information, the Barron's Gold Mining Index (BGMI) hit a new all time high last week". Which it did in spite of the fact that, "In 1980 when the BGMI last hit its all time high, all the world was paying attention," although "in 2007 no one cares - yet," which includes "the staff of Barron's who published the new all time high of their own gold & silver mining index with no comment."
And the reason that "no one cares" is that, "In 2007 the reality is that very few professional money managers bother with the gold mining shares."
He thinks that it "is unfortunate that one of the greatest bull trends since 2000 has been gold and silver mining and the general public is unaware of this fact." I laugh! I don't! I don't think it is unfortunate at all! I think it is the natural order of things, which is that for me (the minority of investors) to make a lot of money, the majority (the ignorant bozos he is talking about) must NOT be buying gold while I am buying gold! The majority must always be wrong! Therefore, it is crucial that they remain clueless at this stage of the coming gold, silver, oil and commodities boom, while the Wily, Scheming, Greedy Pigs (WSGP) of us buy gold, silver and oil at bargain rates!
Greg Grillot at Whiskey and Gunpowder senses my greed and gluttony for gold, and suddenly asked, "if America has 8,180 tons - or nearly 261.7 million ounces - of gold in reserve…how many dollars does that buy?"
Immediately I thought of my calculator, mostly wondering where it was. Then he said "The answer will shock you", which was shocking enough in itself, as I don't remember taking my calculator to anyplace shocking, and I find that I don't like it when people say "This will shock you" because it is always Really Bad News (RBN) for one reason or another, and usually shocking.
Thankfully, Mr. Grillot decided to offer an introductory preamble, giving me a chance to fasten my seat belt and bite down on a rubber dog toy (which tasted like dog hair for some reason). He said that following Nixon's severing the tie of the dollar to gold in 1971, "When dollars became unhinged from gold, the printing presses at the Fed cranked up. By 1980, for every ounce of gold in America, the financial system carried $6,966 in cash. That's $1.8 trillion total. But get this, by the end of 2005, the total real money supply shot to over $10 trillion", and that means that there is "$38,349 in circulation for every ounce of gold in reserve!"
And that probably assumes that all the gold held by the Fed is still there and still owned free-and-clear, which is the preposterous, barefaced lie that the Gold Anti Trust Action Committee is having so much fun exposing. So, if half the gold has been sold or leased out, as they postulate, then there is $76,698 of money supply for every ounce of gold!
And gold is selling for less than $800 an ounce right now? Wow! What a bargain, huh?
The ignorant will, one day, without fail, be desperately buying gold and driving the price to unheard-of levels, and I will be much, much richer when they do, and they will be wiser, much wiser, though poorer, and there is nothing "unfortunate" in that at all from my perspective! Hahaha! Chumps! Or, from their perspective, "Ugh."
Mogambo sez: Ah! Another day, another load of money created, and more inflation to produce a coming windfall in gold, silver and oil, which the central banks and governments of the world will try to forestall by manipulating it away, keeping prices unnaturally and temporarily low so that we can buy more. Could life get any better?
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Editor's Note: Richard Daughty is general partner and COO for Smith Consultant Group, serving the financial and medical communities, and the editor of The Mogambo Guru economic newsletter - an avocational exercise to heap disrespect on those who desperately deserve it.
The Mogambo Guru is quoted frequently in Barron's, The Daily Reckoning and other fine publications. To read all of The Mighty Mogambo's musings from this week, click here.
-- Posted Wednesday, 10 October 2007 | Digg This Article | Source: GoldSeek.com
