Comments on: How Freakin’ Clueless Can the Federal Reserve Be?

By: albert Meggers

albert Meggers — Thu, 26 Nov 2009 04:50:25 +0000

Dude… Gold will rise relative to the value of the US dollar. If the Fed prints money like crazy, the obvious result is that it’ll take more dollars to buy the same amount of gold. That’s why we used to tie our currency to gold until 1971. There isn’t a bubble in precious metals – we’re destroying the value of our currency like every empire in the history of the human race that tried to operate a fiat currency.

By: Chuck Ponzi

Chuck Ponzi — Wed, 25 Nov 2009 15:36:09 +0000

I believe that’s exactly what they’re doing.

Of course, I rely on 2 things here: 1. The masses are quite often wrong in financial things. 2. where is this “inflation” going to come from? Japan’s central bank pushed on a string the better part of 20 years now, and they’re still facing deflation.

Like stocks have P/E and housing has rent/own ratio, commodities have replacement cost. Many of them are way over theirs. We can place a lot of productive people in mining for gold at $450/oz to make these kind of profits.

I’m not going to tell you where to invest, but it would make sense to buy gold miners with this kind of price differential.

Chuck

By: Captain EO

Captain EO — Wed, 25 Nov 2009 07:34:11 +0000

Chuck,

Great post, like always. Looking forward to the new format and/or website.

In regards to your commodities bubble theory, don’t you think people are flocking to commodities due to assumptions of inflation in the long run?

By: Chuck Ponzi

Chuck Ponzi — Wed, 25 Nov 2009 05:18:00 +0000

I’m changing my format on the site. I’m thinking of launching a new site, and I’m going to run an edgier message.

By: James/LAEF2

James/LAEF2 — Wed, 25 Nov 2009 04:03:11 +0000

Hey Chuck,

Nice to see you posting like crazy. Speaking of which, I’m doing the Bridge to Nowhere hike in LA this Turkey day weekend.

I am planning to spend a few hours panning for gold too!