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Why Bernanke Misleads the Public on Gold

By    |   Monday, 14 October 2013 07:39 AM

Ben Bernanke, chairman of the Federal Reserve recently said, "Nobody really understands gold prices and I don't either."

Now, tell me . . . how does the world's biggest holder of gold not know anything about gold or where it may go?

You mean, the Fed just holds 75 percent of our reserves in gold (over 8,000 tonnes) and yet they don't understand really what they own a ton of? I find that extremely hard to believe.

Believe me, anything that I was to "load up" on through the years, I can tell you, I'd know a lot about.

For some reason, central banks have always wanted to "play dumb" when it comes to the topic of gold. With their words, they essentially discourage gold ownership, yet with their actions, they hold more of it than anything else.

So why is it that they really hold so much of it, yet discourage you from doing the same? In my opinion, it's because they know that gold is the ultimate "anti-dollar."

In other words, as they print more dollars and cause the dollar to go lower, their gold holdings overall gain more in value. So the central bank doesn't lose purchasing power due to money printing because they hold so much gold.

Yet, if the Fed can discourage the public from owning much of it and encourage them to have faith in only U.S. dollars, then they can reduce their purchasing power over time.

Why do this? Poorer people are easier to control than are richer people. It's true that money equals power in this world. Even the Bible says, "The rich rule over the poor."

Maybe you give Bernanke the benefit of the doubt though? However, remember that this guy holds economic degrees from Harvard and MIT. He's a sharp guy. They wouldn't put a dummy at the head of the world's most influential central bank. That's why I believe he "plays dumb" for strategic reasons.

But he's not alone. While he says "nobody else does either" when it comes to understanding gold, his central banker friends pile up gold too. Interesting. I suppose they don't know anything about what they invest so heavily in also.

And these central bankers want to own even more of what they supposedly don't understand. The World Gold Council estimates that central banks will buy up roughly $15 billion in gold this year. (They already own 18 percent of all of the gold ever mined.)

Yet, when asked in a Congressional hearing why the central bank owns and buys gold, Bernanke's answer was that central banks own bullion as a "long-term tradition."

Really? It's just tradition? So since "we've always done it," we've got to keep on doing it? That's the dumbest reason that I've ever heard. Much of the time someone describes something as a long-term tradition, they usually do something but they don't really know why they're doing it.

Ok, so the United States owns $344 billion of something they say they don't understand. But all of the other major central banks do what our central bank has done.

Germany owns 3,391 tonnes of gold, which is about 72 percent of their reserves. Italy owns 2,451 tonnes, or 71 percent of their reserves. France owns 2,435 tonnes, or 69 percent of their reserves. China owns 1,054 tonnes, etc. So I think you get the point.

All of these central banks do the same thing. And they hold a huge percentage of their reserves in gold (except China, but they are building their position in gold constantly).

So if you put most of your money in something, you'd better know what you're invested in and why you're invested in it.

Warren Buffet says if you buy something and you couldn't put on an index card, "I bought this stock for…" and put the reasons down, then you shouldn't be investing in it.

Well, I KNOW these central banks know why they own gold. They know they (the central banks) are bent on raising inflation and diluting the purchasing power of their people.

It's a way to wage a war on a people without the public even realizing it. You can slowly siphon off their wealth in kind of a stealthy way and they'll never know it. Thus, you can essentially steal their money and without a fight being put up.

Yet, if you've followed me for any length of time, you know I've taught you about the schemes of the central bank and our government at large and how to shield your wealth from it.

I go into great detail as to what exactly to invest in with my Ultimate Wealth Report newsletter, where I've been able to help 80,000 subscribers shield and build their wealth over time, despite the tactics of the central bank.

Know the game. Know the game's rules. Then know how to play in light of the rules. The rules of the game are stacked against the average person. However, the one that knows how to play the game can come out on top and not have their wealth whittled away by the Fed and the government.

About the Author: Sean Hyman
Sean Hyman is a member of the Moneynews Financial Brain Trust.
Click Here to read more of his articles. He is also the editor of Ultimate Wealth Report. Discover more by Clicking Here Now.

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Ben Bernanke, chairman of the Federal Reserve recently said, "Nobody really understands gold prices and I don't either." Now, tell me . . . how does the world's biggest holder of gold not know anything about gold or where it may go?
Monday, 14 October 2013 07:39 AM
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