When you write a blog like this it is necessary to daily review all the sources of information you use to stay informed in case something new pops up. This week I see two alternative media sites running articles suggesting that the US government is sending out "propaganda agents" to mislead the public on how much gold the US really still has in its possession.
One of the articles mentions Jim Rickards by name in suggesting he is not only misleading the public on the gold question, but is also trying to "sell the idea of using the IMF SDR to the world as a reserve currency replacement for the dollar". Here is a link to that article. This article also refers readers to a King World News article suggesting a similar idea (but does not mention Jim Rickards by name). Readers here know we often cite Jim Rickards interviews and articles. So how do we react to all this? Let's take a look.
I have followed Jim Rickards now for a number of years. The reason I cite his articles and interviews is because his track record on forecasting is very good. In addition, he provides substantial documentation and evidence for his analysis and views. Something I view as very important in presenting information to the public. Especially to people new to all these complicated issues related to the monetary system.
The articles that I noted above that are critical of Jim Rickards make two basic arguments. One is that he is misleading the public on the actual physical gold held by the US in its possession. The other is that he is trying to sell (or prepare the public to accept) the idea of the IMF SDR as a new global reserve currency to replace the US dollar.
Regarding the first criticism, in every interview or article I have seen by Jim Rickards on the US gold holdings he states that he believes there is gold leasing taking place. There is good evidence to support this as we noted in an earlier article we ran on Central Banks and gold. However, there is no evidence that I know of that proves any physical gold is missing that the US reports owning. In the article linked above, we noted the official US Treasury and US House Finance Committee reports that state the official gold holdings. While I can understand why some may be suspicious of those reports since the US is not willing to do a full audit on the gold, suspicion is not evidence. If someone has evidence (proof) that actual physical gold is missing, they should come forward with it. Otherwise, they should state it is their opinion the gold is missing because without proof there is no way for any of us to verify it either way. I don't see how Jim Rickards is misleading the public by simply accepting the reported physical gold inventory issued by the US Treasury. If those figures are wrong, then it is the government reports that are misleading. Again, we cannot know how much leasing has been done because the US Fed refuses to disclose that information.
Regarding the second criticism, I have heard Jim Rickards discuss the topic of the IMF using the SDR as a reserve currency in the future many times. I have never heard him suggest he favors that. I did not get the impression he is attempting to "sell" anyone on that idea. In fact, in several interviews that I heard, he goes out of his way to suggest that he thinks a fiat version of the SDR will not work and will eventually give way to a gold backed system one way or another. So again, I don't understand why people would suggest he is advocating using the SDR as a global reserve currency. That is not consistent with his comments in the interviews I have heard.
When I listen to Jim Rickard analysis, what I hear is someone trying his best to forecast what he thinks is most likely to eventually happen (whether he agrees with it or not). I do the same thing here. As I have stated on this blog before, my opinions don't really matter. What matters is what actually happens. And people trying to become informed and prepare for whatever happens need to be ready for what is most likely to actually happen.
I fully support the right of everyone to offer their opinions on these topics and their right to convince others that their view is correct. But I do think that readers here need to listen to various views and then compare opinions and forecasts they see to what actually happens (whether it agrees with their own point of view or not). It is important to make decisions based on the best information available.
I see no evidence that Jim Rickards is trying to mislead people. Rather, it seems to me he is trying to inform and prepare people for what he genuinely believes is going to happen. He may end up being right or wrong. But his track record so far is very strong which is why we cite his work here and will continue to do so as a credible alternative viewpoint.
Update: Jim Rickards new interview provided an opportunity to explore this topic in more depth so I added a new Part II article which you can read here.
Update: Jim Rickards new interview provided an opportunity to explore this topic in more depth so I added a new Part II article which you can read here.
Excerpt: “What matters is what actually happens. And people trying to become informed and prepare for whatever happens need to be ready for what is most likely to actually happen.”
ReplyDeleteThe future depends on what the Peoples of this world’s countries desire. If those in the commentariat coyly prognosticate outcomes on the predicate that … ‘what happens’ will be preordained so by government dictate … however they feign ‘distance’ from it … act, through their discourse in accessory, by surreptitious omission of the historically proven course of stability … being in this particular, Honest Money absent circulating credit.
All minutia aside, what both Mr. Rickards and Mr. White argue, is the unquestioned … presumption … that the banknote scheme is inviolate and permanent. This one element is the crux of what I’ll assert here as their mutual deception. Both defend the false paradigm of a credit based excuse for a ‘monetary system’, with gossamer ‘cover’ of allusions to ‘gold-backing’ the credit.
A common-law Maxim apropos in this instance is “What is like is not the same, for nothing similar is the same.” 4 Coke 18. Regardless that credit can function superficially like money, genuine money’s greater effects (such as objective price discovery and rational inter-relation to all goods universally) are impossible of duplication. Thus Rickards and White willfully propagate fiction over reality.
Money Is Weighed, Fictions Are Counted
Thank you for your comment and thoughts.
ReplyDeleteI would disagree that either I or Jim Rickards "defend the false paradigm of a credit based excuse for a monetary system".
As I mentioned in the article, I don't think Jim Rickards is advocating that a fiat credit based system is preferable to a gold based system or that a fiat based credit system is inevitable. I think he is trying to look at the available facts and assess what is the most likely outcome. I do the same thing in attempting to plan for the future. So far his track record for forecasting is better than many who are constantly call for imminent disaster and issue timelines that are wrong. But time will tell us who has the best grasp of things.
No one can know the future. In this blog I regularly list several possible future scenarios. One of them includes a complete breakdown of the present monetary system in which the global financial institutions lose control of the system. Looking at the available evidence right now, that seems like the least likely scenario to me, but I don't dismiss it as a possible outcome.
The main point of this blog is to encourage people to begin learning about these issues and make plans for a variety of possible future scenarios. I am happy to admit (and have in several articles on this blog) that I do not know what the future will bring or which outcome will eventually unfold.
I think the wise thing to do is prepare for a worst case scenario and then hope for the best case scenario. I have no interest in defending the present monetary system or seeing it collapse either. My interest is in trying to be aware of what is happening and then make the best plans possible based on good information. There is no other agenda here and my limited contact with Jim Rickards does not suggest to me he has an agenda either. But time will tell us the answers. The most important thing is for people to stay engaged and follow events. Jim Rickards will either end up being right or wrong on his forecast, I will simply follow events and report on the outcome.
Mr. White, for those of us who’ve developed an immunity to ‘expertosis’, Mr. Rickards’ military and intelligence connections are only minor ancillary elements compared to his being a member of the Barristocracy with specialty training in Tax Law, an ‘International’ Economist whose ‘skills’ were applied toward counseling LTCM (one of the most despicably corrupt confabulations hatched from ‘Modern Money Mechanics’) and a member of the Council on Foreign Relations, which routinely undersigns policies and measures thoroughly destructive of Public Liberty and their Private Property.
DeleteMost disturbingly, he utterly fails to even entertain the faintest notion that mankind will fare a more Just and Equal lifestyle, universally, by re-institution of the poly-metallic monetary scheme, whereby each social strata is afforded economic independence to fend off avariciousness of the others.
“The few who understand the system will either be so interested in its profits or be so dependent upon its favours that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests.” Rothschild Brothers of London (1863)
Such is ‘that class’ which Mr. Rickards aspires to increasingly luxuriate in.