Blog

January 5, 2004 – Seventy years ago this month the dollar was devalued against gold by 69% when the federal government arbitrarily changed the definition of the dollar. What had been 23.22 grains of gold ($20.67 per ounce; $0.66 per goldgram), with the stroke of Franklin Roosevelt’s pen was suddenly cheapened to 13.71 grains ofRead more

December 22, 2003 – It is easy for economists – like generals – to fall into the trap of fighting the last war. The big monetary upheavals of the last century were caused by deflation and inflation. So it is really not surprising that most economists today focus their debates on these two monetary afflictions.Read more

December 8, 2003 – Since the spring of 2002 the World Gold Council (WGC) has been developing an exchange-traded fund (ETF) for gold. The objective is to eliminate the hassle and inconvenience of handling physical metal by providing the ownership of gold through a listed security that can be conveniently purchased and sold through stockbrokers.Read more

December 1, 2003 – By a so-called Executive Order, President Roosevelt declared on April 5, 1933 that: “All persons are hereby required to deliver on or before May 1, 1933, to a Federal Reserve Bank or a branch or agency thereof or to any member bank of the Federal Reserve System all gold coin, goldRead more

November 10, 2003 – “Predicting rain doesn’t count – building an ark does.” So says Warren Buffett. Long-time readers of these letters know that I hold Mr. Buffett in the highest possible regard. Though I have never met the man, I admire him from afar, and I continue to marvel at his exceptional track record.Read more

October 27, 2003 – Because financial statements provide a snap-shot of a company’s balance sheet for just one day, the opportunity exists for corporations to take steps before their fiscal year-end to ‘window dress’ their financial accounts. In other words, they take those actions that they believe will present the financial statements sent in theRead more

October 6, 2003 – After gold trading closed in New York on Friday $13.70 lower from the previous day, a Reuters article gave the following reason for gold’s rout: “Gold tumbled 3.5 percent in New York on Friday as the first rise in U.S. payrolls in eight months lifted anxiety about economic growth and underminedRead more

September 15, 2003 – Back in January 1993 The Economist magazine published an article entitled “Fool’s Gold”. It was so full of inaccuracies and blatant anti-gold propaganda that I felt compelled to respond, and did so in Letter #120 (“No Fool’s Gold”, published March 1, 1993). There is no need to go into details, butRead more

August 25, 2003 – Debasement is a word often used to describe money, or more precisely, the decline in the value of a currency. According to Webster’s, it means “to lower in status, esteem, [or] quality.” That definition surely applies to the dollar, and many other national currencies for that matter. But debasement also hasRead more

August 11, 2003 – Thirty-two years ago this week, President Nixon changed the course as well as the innate qualities of the dollar. The dollar, which is a money that predates the Constitution, had always been a precise weight of precious metal – silver until 1900 and gold thereafter. All that changed in 1971. ButRead more