They can’t print Gold out of thin air… or can they?

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for The Q Wealth Report

Bernanke is about to fire up the printing press to maximum capacity. The dollar surged today against all logic (stock market down, the Fed printing money like never before…) But I predict it will do an about face and precious metals will break out in spectacular fashion. Buy gold, physical only…ignore the manipulated paper market.

Why do I say that? Because the whole point of buying gold is that you can’t print it. Or can you?

As I predicted last week, we are seeing a big and growing divergence between the official gold  ‘spot’ price and the price at which you can actually buy the stuff.

Why is this? I found a good reply on marketwatch.com to someone who said you can’t print gold out of thin air:

Actually they are (sort of) [printing gold out of thin air] and that’s why gold is not currently at $1200 +.  If you do not have physical possession of your gold then how do you know its there? Go to any of the gold sales houses (Kitco for example) and you will see a disclaimer that says that supplies are low and there are delays with sending the gold out – because supplies are low??? (what ever happened to prices going up because of supply and demand like it does for oil?) But then there are ways to buy gold where you never actually take possession of it – you have the word of the company that it is there thought so you should feel ok. Well, what if they take your 100oz. of gold that they have in storage and sell it on paper a few more times. As long as no one wants it delivered they are good to go – printing gold out of thin air. What I would be interested to see is everyone that has paper gold to demand possession – I suspect a bunch of problems for many sellers because I seriously doubt they would be able to make good on even most of the paper claims – then see where spot prices go to…

If you need any evidence of this, well Swiss banks are seriously worried about it at the moment because they are short on their gold and silver certificates. I wrote about this yesterday over at petermacfarlane.net: Swiss banks are short on silver and gold backing paper.

If you have some of those strong dollars, I truly believe you should keep on buying physical gold. Forget all other types of gold!

We are certainly living in exciting times. After some years we will come out of this crisis. Some people will be a lot poorer, and others a lot richer. Which group will you be in? Join us now and you will have the chance to preserve your wealth and see it grow!

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