The big story last week, “French Champagne Maker Finds $1 million in US Gold Coins”. I agree, this is big news but the big story is not the find, not the number of coins either. The big story is why the media doesn’t question how $10,000 in face value gold coins (497 coins x $20) are now worth nearly $900k in melt value gold. If you own silver or gold, or thinking of buying PM, you must take a moment to wrap your mind around this story or better yet, lack of story. The value of future gold is written between each line but only obvious to those willing to accept gold as money. This type of news only proves my decision to trade dollars for PM back in 2002 was as wise now as ever before.
Would you read such an article if the headlines said, “$10k In US Dollars Found in Champagne Maker’s Attic”, why not? After all, a $20 Liberty coin or $20 Gauden both had a face value and dollar value of twenty bucks up until a tragic day in 1933. Twenty bucks, the same gold coins that recently rained down on a French construction crew worth $1,000,000.00. I searched the internet looking for one article willing to explain why or how $10k in gold coins turned into $1 million over eighty years, nothing. Not one reporter, or editor, rolled the dice on such a delicious backstory as the one you’re reading today. It is important to understand that the person stashing 497 $20 gold coins was not hiding a million USDs; they were hiding $10,000 at the time (it’s believed gold coins were stashed in the 1930s).
So many questions run through my head with a find like this one. Why did someone hide US gold coins in a French warehouse many years ago? Was it because of US gold confiscation? Was it to pay a foreign debt? We’ll never know the answers to these question but the one I most want to ask is not to the construction crew, not the Champagne profiteer either, the question I want to ask is to non other than Mr. Bernanke (Federal Chief) himself. The question, “Mr. Bernanke, why is it after eighty years the same 10,000 (in US dollars) is worth around $1500 today but the same $10,000 in gold is worth nearly $1,000,000 now?” Then just one other follow-up question, “How can you repeatedly say gold is not money when this find proves a true value of 100 times face value?”
It is imperative to comprehend how willingly citizens and media accept dollars as money when a find like this proves exactly otherwise. Mr. Bernanke can’t admit his monetary beliefs are jeopardizing a worldwide economy because this is validating decades of monetary mistakes. We must also realize, just as our dollars continue to decline, the fault will lie with someone else well before admitting a fiat currency exists to empower government, not its people. I’m not sure why most refuse to connect obvious dots but keep buying metal until they do. So now we must ask what a media awakening will do for metal prices and when will this revelation take place?
Today’s media age is much more about sensationalized news than reporting. We live an age of confetti and balloons which is unfortunate for things real like precious metals. Our media will eventually find the story of gold but my guess is not approach it as worthy but popular. The disadvantage of such a presentation is misleading and will drive uneducated buyers (gold ignorant) into a metal they know little about, this will push PM prices far above intrinsic value. The age of social networking will spread news of the next gold rush like 60 mph winds spread fire but, unfortunately, the masses won’t understand coming in too late is worse than not buying at all. I see today’s prices as nothing more than fraction of future values but who truly knows for sure?
Timing of such an event is impossible and in all probability will take place over many phases before turning straight vertically, like 1979, 80. A conflict in Iran or a disruption in oil that leads to a spike are all reasonable explanations how something can trigger gold’s run. A slow continuation of dollar devaluation, with inflation, could easily turn the pack toward PM. The timing is far less important than an exit plan. Those who truly understand how masses fighting over a limited supply will drive any asset well beyond true value will profit most. We know this to be true when we recall dot.com and housing bubbles of not so long ago.
THIS IS MY TAKE SO TELL ME YOURS. DOES A FIND LIKE THE ONE WE DISCUSSED TODAY PROVE GOLD OVERVALUED? WHY CAN’T MORE SEE GOLD’S DOMINANCE OVER PAPER CURRENCY? CONTACT ME RIGHT HERE WITH YOUR COMMENTS OR QUESTIONS.
COMMENTS & QUESTIONS:
Thanks for such a Great Website,
I check for updates everyday.You are right on with your message about Gold & Silver. I started with buying Junk Silver, then added Silver Eagles and then some smaller size Gold Eagles. I will continue to buy some of each of the Gold & Silver Eagles as I’m able. My reasoning on owning Gold & Silver is it’s all part of a well rounded survival plan. Having some sort of short and long term food stored. Having some protection in the form or guns and ammunition. Paying off debt, keeping some cash were you can get at it. And having a variety of PMs just makes sense. Thanks Again for all the great information
PROSPECTOR REPLY: Thanks for the comment. You are wise to own both gold and silver as part of a bigger protection plan. My understanding is Gold and Silver Eagles (that you now own) are the most popular bullion coins available since both have a guarantee of authenticity from the US Mint. You mentioned “Junk Silver” and I”m glad you did since we often overlook the value of bags of old silver coins. If others are looking to find an easy entry into silver then I urge you to look into junk silver as one of today’s most affordable options. Many online bullion dealers also sell bags of junk silver in several different sizes, many times at low premium over spot. If any of our readers have more info on this type of physical silver (junk silver) please pass it along. Thanks again for the comment.