Gold Wars

Ben Davies of Hinde Capital lays out the argument of how and why governments control the gold market by suppressing the price; why gold is still cheap relative to fiat currencies, equities and other commodities; explains gold’s historical role as a monetary asset and how small it is in terms of global financial assets; how the growth of paper money has way outstripped the growth in the gold stock and price over the past four decades; the implication BRIC currency diversification holds for the gold price; and much more.

Over the long-run, all these factors are very positive for the South Africa economy in terms of foreign investment inflows, job creation and real wealth creation.  We opined about gold rush 21 and its implications for South Africa back in Nov 2009.  The reason the South African economy in fact fared well during the Great Depression and the stagflation of the 1970s was because our mining industry, and in particular, gold mining, experienced boom times as the purchasing power of gold went up relative to goods and services.  Can it happen again?  It sure can.  At the right gold price…

Gold Wars a Golden Renaissance Presentation September 2010