[–] captainplanet2 1 point 4 points 5 points (+5|-1) ago
Amid international accusations that U.S. officials in the Clinton administration replaced gold in Fort Knox with phony, mostly tungsten bars that were later shipped to China and other places yet unknown, a German refinery has now discovered that it has received a bogus “gold” bar as well.
The video proof was shown on the German television station ProSieben that ran the news story covering W.C. Heraeus in Hanau, Germany, the world’s largest privately owned refinery.
In the story, Wilfried Horner, head of the gold foundry, shows a 500-gram bar (16.0755 troy ounces) received from an unidentified bank. The bar had the right physical dimensions to be an authentic gold bar, but one of the Heraeus employees suspected something.
After the bar was cut in half, the TV audience could plainly see that the dark insides were tungsten, with only a coating of gold on the outside.
[–] [deleted] 0 points 1 point 1 point (+1|-0) ago
[–] captainplanet2 0 points 1 point 1 point (+1|-0) ago
I assume China, Russia, Iran and Venezuela. Though what happened to the Libyan Gold is anyone's guess. Hillaries using it to fund her campaign? Weapons for ISIS and al Queda?
[–] Allrightsreserved [S] 0 points 12 points 12 points (+12|-0) ago
From the article "When you think about it, a bet on gold is really a bet that the people in charge don't know what they're doing."
[–] robertrobot 0 points 1 point 1 point (+1|-0) ago
HOkay I'm willing to bet my entire savings and all my future earnings on that. I wish it was that easy.
[–] Caboose_Calloway 0 points 14 points 14 points (+14|-0) ago
Somebody wants gold prices to fall and is ready to pay WP for it.
[–] didntsayeeeee 1 point 0 points 1 point (+1|-1) ago
I dunno, if you want the gold price to fall, the thing to do is to not talk about gold for a while.
Writing an article like this just brings all the goldbugs out of hiding to argue about how wrong it is.
Personally I don't care either way, I don't own any gold, and I think I shall continue to not own any gold so I can have the luxury of not caring about the gold price.
[–] CommonSense 0 points 8 points 8 points (+8|-0) ago
so I can have the luxury of not caring about the gold price.
Instead, you get the luxury of watching your un-backed, paper dollars gradually lose purchasing power.
[–] [deleted] 0 points 4 points 4 points (+4|-0) ago (edited ago)
[–] armday2day ago
The price of gold would have to be high enough to justify that kind of expedition and mining operation
[–] acheron2012 0 points 3 points 3 points (+3|-0) ago (edited ago)
Beyond the obvious fact that if WP says it then by definition a lie, this article defies the most casual application of logic. Gold prices are being manipulated, probably more by China than the US. But the world economy is starting to remind me of one of those Vegas machines that has the little sweeper arm and hundreds of quarters. Just one more little push and it's all coming down.
Gold is approaching its extraction cost. Therefore it literally cannot go much lower. Conversely the world's banks aren't even bothering to print worthless fiat paper anymore. It's just numbers in computers.
At the absolute worst by buying gold instead of US Bonds you will miss out on the less than 1/4 of the real inflation rate the bonds pay in interest (as bonds age their value approaches absolute zero). But the day all those chips fall, you may actually be able to eat. Now wouldn't that be nice?
[–] merton ago
Can you explain how gold cannot go lower than its extraction cost? Oil is going well under its extraction cost.
[–] acheron2012 ago
Cannot is probably a poor term. Already extracted gold could of course go to the simple carry cost of moving the "worthless" metal around. The rub of course being that the metal is a valuable commodity and not at all worthless - unlike the fiat currency of countries attempting to skew this reality. But much like the housing bubble, and Internet bubble before it to quote Stein: "If something cannot go on forever, it will stop".
Gold miners don't want to close up shop and go work at Starbucks. Neither do oil extractors. And every company has both savings and credit. If the company ceases to be profitable it can continue for a while by spending savings and then using lines of credit. That's why by the time they reach bankruptcy court there isn't much left to pick over. But these are finite limits. Eventually they cannot continue to do this and their business will fail.
What you are seeing in oil is really more of a price war in a depressed economy; Saudi Arabia is very intent on driving higher priced competitors out of business, primarily western oil shale and sands. Thus they are using cash reserves to reestablish their market monopoly. Gold is under similar, pressure as countries attempt to reestablish the mindshare and savings monopoly of their paper money by flooding the market and discrediting the commodity as a safe haven for wealth. Both are time honored strategies that have worked many times throughout history.
The thing about these external forces is that they are incredibly powerful and have the resources to continue far longer than one would initially expect. But the laws of economics will not be denied forever, and they will exact a toll when the intervention stops and the price skyrockets back to free market levels. So gold is already a bargain. But it may go substantially lower in the short term. The absolute bottom is really unknowable to anyone, even the people driving the market. I would say it is a very dangerous short term investment. You could easily lose 20% or more of your money in the next 6 months. But in the longer term, even 10 years out, there probably isn't a better investment today anywhere in the world.
As an aside this is the trap the Federal Reserve fell into with below 0% real interest rates and QE. Once you establish these policies and they are figured into market valuations it becomes damn near impossible to turn it off without wrecking everything you were propping up.