By Jeff Nielson of Bullion Bulls Canada
) --It's never a waste of time to read the views of Canadian gold icon, John Embry, and a
he wrote is no exception. Much of his thoughts on how and why the precious metals markets are so strong are based upon "fundamentals" with which we're already familiar. There are no longer any surprises here.
I will beg to differ with Mr. Embry, somewhat, here: He observed that the U.S. propaganda machine had (finally) cut back on its plethora of
articles, and he had now been reading that the "reason" why the precious metals market won't keep going higher is because these markets are (supposedly) overbought.
In fact, the propagandists haven't stopped one form of gold-bashing in favor of another. Rather, what has been exposed is one of the innate weaknesses in propaganda: once a saturation level of propaganda has already been reached, additional attempts at brainwashing will have a steadily diminishing impact -- eventually numbing readers/listeners to the point where the propaganda is simply tuned-out.
This is especially true with respect to the precious metals market, where during this 10-year bull market, investors have been exposed to 10 relentless years of anti-gold propaganda, every bit of which was proven false. In a scenario such as this, the brainwashing of the propagandists is especially susceptible to over-use, since even the most dim-witted sheep will begin to notice when someone has been consistently wrong about a subject for 10 years.
This is why we see sentiment in the general public toward precious metals slowly improving: the
about the precious metals market are increasingly less able to deter the general public. Thus, when Embry talks about the propagandists "stopping" the gold-bubble nonsense, and "starting" the overbought-babble, what is really taking place is merely the alternation between one avenue of propaganda and another -- so that the sheep don't become totally immune to all of the propaganda, permanently.
The other aspect of Embry's article that I found particularly thought-provoking was his observations about how the propaganda-machine is desperate for some "respectable voices" to utter their propaganda -- as this tends to counter the repetition-effect I described previously.
Here, at the top of the list is George "Bubbles" Soros, who is seen to repeatedly use his mouth to utter the words "gold bubble" (over and over and over).
Embry chose to focus upon the
, and his lieutenant, Charles Munger. I won't bother detailing their rhetoric, after Embry has already done so. Suffice it to say that the reason of both for their "I hate gold" attitudes is the tired, old line about gold having no intrinsic value. You can't eat it, you can't pour it into the tank of your car and drive around -- so it has no value.
John Embry refers to this as "sophistry of the worst sort," and I fully echo that remark. Intelligent precious metals investors have known for years what is seemingly beyond the grasp of Buffett and Munger: that gold (and silver) is the
ever devised by our species. Here we can expand on the empty "logic" of Buffett and Munger.
Without "money", a convenient medium of exchange for commerce, we are left with no alternative except "barter." Does any rational adult actually think that our modern economy could survive a week without a legitimate currency to use in all of our transactions?
Picture going to
with a couple of chickens you've loaded onto your child's wagon. While there to exchange those chickens for some of Wal-Mart's goods, you line-up behind someone holding a goat (along with their merchandise) and also see a bushel of wheat, several gallons of milk and various other "hard assets" that people must exchange in order to do their shopping.
And what about Wal-Mart? After concluding all of these transactions, are we to assume that Wal-Mart will simply pack up this assortment of crops and livestock -- and be able to exchange that with their suppliers for more manufactured goods?
Of course not.
If one of the first things that our primitive societies did was to invent a convenient medium of exchange (i.e., "money"), then clearly for our modern world, "good money" is one of the most essential "commodities" of our species.
Obviously, when we look for some item with "no intrinsic value," the first place where any informed person would look is at the banker's
. Has anyone tried to eat their paper currency? How about burning it in their cars as fuel? Indeed, if Mr. Buffett and Mr. Munger shun gold as something with no "value," why have these gentlemen spent their entire lives endeavouring to accumulate billions of Bernanke's green confetti?
In fact, what we are really seeing here is obvious: Buffett is sitting on his own mountain of worthless Bernanke-bills -- and can only enviously eye the tiny gold and silver markets: home of the world's only "good money," where there is no possibility for him to exchange even a significant portion of his worthless green, for eternal gold and silver.
Not surprisingly, Buffett has been an
of the U.S. financial sector (where another large chunk of his net worth is located).
The same man who became world-famous for his philanthropy is now standing squarely behind the
- who are in the process of fraudulently throwing tens of millions of Americans out of their homes so they can seize their properties. This comes after their
left their own markets (and most of the global financial system) in ruin.
It was none other than George Bush Jr. who told the world that those who provide "sanctuary" for terrorists are equivalent to terrorists themselves. In this respect, how will history regard Warren Buffett, who (at the peak of Wall Street's
) has been doing everything in his power to shield them from the consequences of their own malevolent acts?
buy gold and silver, for reasons summed-up most eloquently by a
. It is Warren Buffett and the infinite mountains of banker-paper that they should shun.
-- Written by Jeff Nielson in Vancouver, British Columbia.
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