I saw this live this morning on CNBC. I had not thought about before this, but it made perfect sense. We know that the Fed will continue to print to infinity because it has to. They can buy anything they desire because they have an unlimited amount of dollars and a mandate that allows them to do so. What better way to monetize debt than to create paper from nowhere and then exchange that paper for the real gold. In this way the Fed satisfies demand for more fiat money while simultaneously stockpiling real money in the form of physical gold. Remember, those who hold the gold makes the rules.
12:48p ET Wednesday, June 22, 2011
Dear Friend of GATA and Gold:
James G. Rickards, market intelligence executive for research firm Omnis, interviewed today by CNBC about the Greek debt problem, remarked that he expects that the international bailout business soon will pass to the International Monetary Fund and result in the issuance of more Special Drawing Rights, money printing for which no particular government will have to bear sole responsibility, an engine of general worldwide inflation that will punish savers. Rickards added that to create more inflation, the Federal Reserve could buy gold in the market and bid the price up substantially, devaluing the dollar and easing debt burdens. Rickards will speak at GATA’s Gold Rush 2011 conference in London in August:
His interview with CNBC today is part of a seven-minute segment you can find here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.