Dear Federal Reserve: Please Raise The Price of Gold

This sounds selfish but this is the only solution to prevent a world-wide recession.

prayingtogold

There are two possible solutions to the problem of the high dollar value and low gold price.  But before discussing the solutions, we need a little background information.

The Federal Reserve, the European Financial Organizations and the largest banks in the world have agreed to keep the US Dollar as the monetary standard.  To do that they need to manipulate the price of gold so it does not replace the dollar.  This means keeping the dollar high and the price of gold low.

Keeping the dollar high has the added advantage of keeping imports low which improves the US trade deficit.  Having a good trade deficit and a strong dollar gives the impression of a strong US economy.

One problem is Russia and China.  They are not happy with the high dollar value and low gold value.  Consequently they are creating their own monetary standard and creating exchanges in their own currency.  This allows them to avoid the US dollar completely.

Another problem is the largest banks such as JPMorganChase are dealing in large quantities of gold derivatives which is lowering the price of physical gold.  See this:

http://www.zerohedge.com/news/2015-07-09/are-big-banks-using-derivatives-suppress-bullion-prices

The real problem is the amount of debt of many countries around the globe.  Greece and the US are just 2 of 12 countries out of 64 whose debt is greater than their country’s Gross Domestic Product (GDP).  That means almost 20%of the largest countries in the world are in debt as seen in this website:

https://en.wikipedia.org/wiki/List_of_countries_by_public_debt

Now to discuss the solutions to the problems of  high debt and the high dollar value and the low gold price.

One solution is to let the nations in debt exchange their US dollars for gold.  But this could result in the depletion of US gold reserves and then the world would find out that the paper gold value does not equal the physical gold valueThat would cause a run on banks, a rush to cash and possibly a global recession.

Chris Powell of the Gold Anti-Trust Action Committee said, “The system may end when one country pulls the plug on it, exchanging U.S. dollars and government bonds for more gold — real metal — than is available, or when ordinary investor demand exhausts supply, which is more or less how the London Gold Pool ended in 1968.”

So a better solution is to raise the price of gold to eliminate the debt around the world.  Some people are proposing a 7 fold increase in price.

Chris also said, “… a study in 2006 by the Scottish economist Peter Millar concluded that to avert such a catastrophic debt deflation, central banks would need to raise the gold price by a factor of seven to 20 times in order to reliquefy themselves and devalue their currencies and society’s debts…”

For more information on what Chris Powell said, read the following website:
http://www.gata.org/node/14839

Okay.  I admit I own GLD and UDN and this would benefit me.  But now I am giving you the chance to also profit from this information.  here is some more useful information:

https://michaelekelley.com/2014/10/16/8-things-to-do-when-recession-happens/

Thanks

2 thoughts on “Dear Federal Reserve: Please Raise The Price of Gold

  1. Having a strong dollar does not reduce the trade deficit. It’s true that it makes imports cheaper, but as the prices are so cheap people buy more of them, and the overall deficit grows.

    In order to reduce a trade deficit you would want a weak dollar, which would reduce imports and increase exports.

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  2. Pingback: Why GLD Is Bad and GOLD Is Good | Michael E Kelley

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