Many years of garnering market wisdom has taught me the value of prudence and patience, and that youthful exuberance is always the last refuge of the inexperienced. Sooner or later their bubble will burst - and market focus will return to seek cyclic intrinsic values and traditional refuge investment vehicles.
Gold is a real universal currency. It can be exchanged into local currency of any country at any time. In other words, the Gold is fully convertible currency in real terms. It never loses its quantitative value – If you buy 10 grams today, it will remain 10 grams even after 50 years.
Further, it is purest form of metal which never gets tarnished or loses shine. If you throw anything into fire, it will be burnt to ashes, not Gold. It will shine. Go to any jewelers’ shop for polishing the gold. Some old fashioned jewelers use the ordinary flame (gas or even candle) to purify or polish the gold to its original finish. (No chemicals are needed). It is the only inert metal not affected by any acid or base.
According to my research, the United States has frittered away most of its gold by lending to hedge funds for shorting operation. It will never come back. They shorted it in $250~$350 range. now the gold is at $1,290. They are losing over $700 per Troy Ounce.
The Treasury/FED shows holding of 8134 tons of gold which has remained constant for over years. However, the loss of gold has been cleverly concealed in the form of “Earmarked Gold” and tricky language.
Although United States has 8134 tons of gold physically, it has lost title to it for almost 6297 tons of gold.
The world production of gold is about 2500 tons. If the loss of 6297 tons of gold by United States becomes public knowledge, hell will let lose in the gold market, and shorts will rush to the market to cover their position.