Most Idiotic Comment Ever? “Sell Gold Because Inflation Will Spike”

Stanley Druckenmiller said:  “I sold all my gold (sic) on the night of the election” because he sees inflation spiking and that will force money(sic) out of gold…hmmm….sell gold because you see inflation coming?  That has to be the most idiotic investment rationale I’ve ever come across.  Even “buy stocks because they keep going higher” is less dumb than that.

You’ll note the “sic” I added after Drunkenmiller’s comment about “gold.”  “Sic” is used after a quoted word (from someone else) that seems odd or out of place.   I inserted “sic” after Drunkenmiller’s use of “gold” because he never owned gold.  He bought GLD, which is a paper derivative of gold.  The only way you own gold is if you buy physical gold and keep it outside the system. GLD is a fraud, just like every other fiat paper “asset.”

I also inserted “sic” after his use of the word “money” with respect to “money flowing out of gold” (because he thinks inflation will spike up).  Gold is money.  It’s the second oldest form of transaction currency – silver being the oldest.

Finally, the idea that gold should be sold ahead of an expectation of a spike in inflation is…well, for lack of a better term, retarded (apologies to safe-space and socially correct people).   Gold is the ultimate inflation hedge.

I sincerely do not know what would motivate Druckenmiller to make those remarks about gold – maybe he was patronizing what remains of CNBC’s imbecilic audience.   I don’t feel any need to directly address each component Drunkenmiller’s assertions about gold – and about his expectations about feeling good about the prospects for the economy.  The audiences of blogs like this one get it.

The current trading action in gold is being fueled by the paper market manipulation. If you review overnight charts for the last 3 months, you’ll see that on average and in general gold moves higher during the eastern hemisphere physical gold trading hours and gets bombed once the London and NY paper gold markets open after the Asian markets close.

It’s as simple as that.  The paper gold market, like Drunkenmiller’s comments and investment rationale,  are emblematic of the fraudulent, debt-riddled Ponzi nature of the U.S. and western hemisphere economies.

While the mantle of “power” in the U.S. was handed from Uncle Tom to Andrew Dice Clay, the real financial, economic and political power is being shifted from the western hemisphere to the eastern hemisphere.   The massive flow of physical gold from west to east is the root of this tectonic geopolitical and economic movement.

17 thoughts on “Most Idiotic Comment Ever? “Sell Gold Because Inflation Will Spike”

  1. He was on C.N.B.C. saying that he sold gold because
    he sees inflation coming. You know that anyone who listens
    or watches that poor excuse for real market information is
    already brain dead. Yea, hey Cramer, I have 200k I need to
    put to work, tell me oh please what should I do?

    1. I guess the western world is still acting upside down despite a more level headed regime in place. It will take a while to shake out all the retards.

  2. I was shocked when I heard Stanley said he sold gold due to his expectation of inflation. Seems like he is just a momentum chaser.

  3. After what India did yesterday will put even greater strain on the physical supply. When it comes to fiat, the state giveth and the state taketh!

    1. India restricted 500 Rupee note! This is only US $7.50!

      You can still get 200 Euro notes, but why? Silver is so cheap & shiny.

  4. I was hoping that with the election of Trump and before that BREXIT, the global banking cartel was on the ropes. However, I see that on the night of the US election The Indian Prime Minister (former Goldman Sachs employee I believe) banned 1000 & 500 rupee notes. 500 rupees is only about $10 so we are not talking about large amounts of cash value notes here. The usual platitudes about reducing fraud and tax evasion, but they want a cashless society. Where does gold and silver fit into that?

    People like Druckenmiller seem oblivious to gold as real money, and own it as paper. I don’t know if they are just ignorant or are public relations people. They also buy their gold, whether paper or physical as a purely temporary investment. Selling out as he has done and moving into something else because he thinks the economy is changing. As you Dave, and Rory have been pointing out on your pod casts the people of the Far East buy gold in a different way. They buy to hold for a long time. They are not fooled by fluctuations in the price. The western banking system, and their former employees like the Indian PM wants to ween the east off this notion. Not sure how succesful they will be, but they are going to scrap paper cash first.

  5. Your are right. Stanley’s claim “I sold all my gold (sic) on the night of the election” because he sees inflation spiking and that will force money(sic) out of gold
    makes sense if the misspelled word GOLD is replaced by GLD.

    1. Exactly! Paper chasers are wise to exit gld before it implodes. So
      nothing wrong with Stanley’s strategy. He’ll take the proceeds and
      buy him some Google and prolly make a fortune!

  6. “He bought GLD, which is a paper derivative of gold. The only way you own gold is if you buy physical gold and keep it outside the system. GLD is a fraud, just like every other fiat paper “asset.””

    I could not agree more. Paper gold GLD claims to be fully backed by physical gold bullion but yet it refuses to give retail investors the right to redeem for any of these ‘claimed’ gold bullion. This fact alone would mean GLD shares are nothing more than paper at the end of the day. Furthermore, GLD’s prospectus is chalk full of weasel clauses and legal loopholes that allows the fund to get away without the full physical gold backing. One good example of this is the clause that states GLD has no right to audit subcustodial gold holdings. To this day, I have not heard of a single good reason for the existence of this audit loophole. I’ve also verified the following to be true and welcome everyone else to do so:

    “Did anyone try calling the GLD hotline at (866) 320 4053 in search of numerical details on GLD’s insurance? The prospectus vaguely states “The Custodian maintains insurance with regard to its business on such terms and conditions as it considers appropriate which does not cover the full amount of gold held in custody.” When I asked about how much of the gold was insured, the representative proceeded to act as if he didn’t know and said they were just the “marketing agent” for GLD. What kind of marketing agent would not know such basic information about a product they are marketing? It seems like they are deliberately hiding information from investors.

    I remember there was a well documented visit by CNBC’s Bob Pisani to GLD’s gold vault. This visit was organized by GLD’s management to prove the existence of GLD’s gold but the gold bar held up by Mr. Pisani had the serial number ZJ6752 which did not appear on the most recent bar list at that time. It was later discovered that this “GLD” bar was actually owned by ETF Securities.”

    1. GLD insurance is a Hotel California contract:

      “We are programmed to receive only:
      You can pay your premiums any time you like,
      But you will never receive your insured coverage! “

  7. Been watching the tonnage displays over the last few days and I noticed on Wednesday 11/09/16 after 5:30 pm the tonnage was the same as it had been on Tuesday, roughly 949 tons. Then today 11/10/16 there was about a 7.5 ton drop. Had Druckenmiller really sold his gld on Tuesday, shouldn’t we have seen some sort of move lower in the tonnage? Or am I off-base?

  8. With his lame excuse still ringing in my ear what’s really apparent here is most likely Druck got a heads up from the Bankster Cartel that the raid to surpass all raids was in the cards. He took the opportunity to cash out.

    Here is Trumps first chance to sound the charge for the rule of law and honest markets. How will he respond.

  9. Yeah I have got to say that was pretty dumb. You want to have gold (and silver) ahead of inflation. And boy are we going to have a lot of inflation! ETFs are garbage even worth less than physical garbage .

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