Santelli: The Fed’s Gold Price Suppression.

• Gold bugs know this to be true: Uncle Sam has been suppressing the price of gold for many years. In fact, most western central banksters do that. They do it to make their fiat currencies look valuable. By selling gold and thus depressing prices, they are saying ‘why hang on to this relic of the stone age when you can have real paper money’. Of course, we all know what paper currencies are. It is becoming more and more obvious that fiat currencies are no more than Monopoly money printed out of thin air. They are debt obligations of profligate governments.
   
• Well, their suppression scheme is no longer working. More emerging countries’ central banks are accumulating physical gold. They understand what gold bugs know: the #1 fiat currency, the world reserve USD is in deep trouble! It is time to ditch it for something that has been accepted as real money for eons: gold. GATA reports: 
    
  The program began as a general discussion of the markets by several investment house representatives but soon got into a long exchange between Santelli and Philip Gotthelf, president of Equidex Brokerage Group in Closter, New Jersey. Gotthelf was making the case for a much higher gold price and asserting that central banks would dread such a thing when Santelli interjected about former Treasury Secretary Lawrence Summers: “Didn’t Larry Summers himself write a paper, called ‘Suppression,’ that central banks have to keep a lid on gold for obvious reasons?”
   
  Until today it had seemed that only the lunatic fringe — or the exceedingly well-informed — knew about Summers’ paper, a keystone of GATA’s research. Of course the paper, written while Summers was a professor at Harvard, wasn’t titled “Suppression,” though that well could have been its title if it ever reached paperback. No, the paper was titled “Gibson’s Paradox and the Gold Standard” and it explained the historic inverse relationship between gold and real interest rates and suggested that central banks could achieve their holy grail, complete control over interest rates, if they gained complete control over their nemesis, the price of gold. “Suppression” is indeed the best single-word summary for what Summers’ paper had in mind for gold, and you can read “Gibson’s Paradox and the Gold Standard” at GATA’s Internet site here: http://www.gata.org/files/gibson.pdf
   
  So now Santelli has let the CNBC audience know that gold price suppression is not only the bane of the supposedly lunatic fringe but also the very premise of the U.S. financial establishment.

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