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The Price of Gold is Influenced by Government Statistics
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Comments from Rick Rule, Jay Taylor, John Doody and Walter John Williams
Last week I spent two days in San Francisco participating in the Hard Assets Investment Conference at the Mariott Hotel and sponsored by Tim Wood and the rest of the folks at International Investment Conferences.
This venue gave me the opportunity to do some great in person radio with folks who are considered to be experts in our industry.
We conducted a panel consisting of Rick Rule, John Doody, Jay Taylor and Walter John Williams.
Williams is the publisher of a newsletter called Shadow Government Statistics. He maintains that the statistics published by the federal government are, not incorrect, but certainly misleading. He told me that if the investing public looked at the numbers the same way that he does people would be aware that our economy is not nearly as healthy as most believe. Taking his argurment one step further, I am convinced that if people believed that Williams is correct, the price of both gold and silver would be significantly higher. I will explain why later.
Williams’ philosophy was the subject of the panel discussion.
I asked the panelists two questions. The first had to do with inflation and the second dealt with employment.
Williams maintains that inflation in the U.S. would currently be running at a bit over 12% per year if the same methods of calculation were used today as were used in the past. All of the panelists agreed. Rick questioned the rationale behind excluding energy and food costs in the calculations when they had both been included in the past. Dr, Doody simply stated that, “the books are cooked”.
Regarding the employment numbers, Williams asked why people who have given up looking for work are not included in the figures. The panelists agreed that leaving this one group out of the equation, skews the numbers away from reality.
We then spent a fair amount of time discussing the correlation between the price of gold and silver and the perception of the economic health of the United States. After hearing what these experts had to say, I am convinced more than ever that if people viewed the statistics as Williams and the other panelists do they would be very concerned about the level of our economic health. This would lead to more investment demand for gold and silver because of its quality as a store of value.
I believe that our discussion, which aired on the Korelin Economics Report Weekly Show, is important enough that everyone should listen to it. You can do so by going to www.kereport.com and then clicking on the segments from the latest weekly show that pertain to it. (Segments 3, 4, 5 and 6)
I would like to know where you stand on this issue. You can let me know by responding to alkorelin@comcast.net.
A.B. Korelin
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Al Korelin is the host of the internationally syndicated Korelin Economics Report. This radio program deals with asset based investing. Guests appearing on the program provide independent opinions based on their research. If Mr. Korelin or any of the guests have a financial interest in any of the companies which they discuss, that fact is clearly disclosed to listeners
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