Of this we can be sure: China WILL keep accumulating record amounts of precious metals.
Why, one asks, would China suddenly reverse course and change a policy that it has now been aggressively pursuing for years? Such a scenario would not/does not make sense.
No, any fair-minded observer has to assume that China has been acquiring and stockpiling gold for reasons it considers very important (and these reasons presumably have not, nor will not disappear).
One reason, no doubt, is that China expects the value of the U.S. dollar to continue to decline and probably, at some point, to quickly plummet. Such an event would cause the treasury bonds the nation holds to also plummet.
Thus, for China, gold is serving its its historic “safe haven” and insurance role.
One can safely predict that demand for gold WILL remain high in many nations, including the nation with the world’s largest population and largest rate of economic growth.
So gold has that going for it.
Strangely, however, one can NOT predict that demand for gold in Western nations like the United States will rise or even remain constant.
In fact, one can probably predict that demand will continue to remain low, at least among the entities that can afford to buy in volumes large enough to move market prices.
No one needs a Bill Rice column to know that “sentiment” for precious metals remains atrocious in America. It’s probably no exaggeration to say that keeping sentiment awful has risen to the level of a national priority, at least among those who make economic and political policy.
So in one half of the world powerful people fear and despise and denigrate gold. In the other half, The Powers that Be covet gold and want to obtain as much as possible while prices are still low.
Given these realities (and they are realities) it doesn’t take a Sherlock Holmes to deduce that nations from both spheres of the globe are happy to see gold prices remain depressed for as long as possible.
Indeed, many people today openly question whether China is somehow involved in efforts to keep PM prices from surging.
If you were China (and wanted to accumulate as much gold as possible) wouldn’t you want to participate in an “agreement” that allowed your nation to keep “buying low?”
And then there is us ...
The group that wouldn’t mind seeing gold (and silver) prices lift off consists of those who think they already own enough of the metal and would like to see their investments appreciate in value.
Relatively speaking, this is a tiny group of people who, for the most part, buy coins and small bars. These citizens make up less than one percent of the adult population.
They/we have acquired gold and silver to protect themselves/ourselves from a collapse of the fiat dollar system, a system that also makes possible the deficit financing that funds a government that is growing at a mind-boggling rate.
Again, it’s a relatively small and insignificant group of contrarians who buy gold and silver. It’s also a much-maligned and ridiculed sub-group of the population.
For some reason, the accepted elite look down their noses at those of us who ignore their advice. (One could also say that we ignore them while they ignore us).
It should also be pointed out, however, that while small in numbers, the group that regularly adds to their “stacks” seems to be steadfast in their resolve and not easily dissuaded from their convictions.
We can see this in sales reports of various mints that produce and sell silver (especially) and gold coins.
A small, but committed army can still be a thorn in an opponent’s side.
With China (probably) wanting cheap prices and the banking and government elites in the Western nations wanting cheap gold prices, what hope do “gold bugs” have that things might turn in their favor?
Or what event would be the proverbial “game changer” and alter the rules of the status-quo game?
A hundred different events or developments might ultimately end up being this “game-changer.”
Whatever this game-changer turns out to be, we can expect at first a trickle and then perhaps a flood of every-day Joe’s to join forces with the disciples who have been preaching the wisdom of acquiring real money to protect one’s family from severe economic hardships.
That is, the straw that might break the price suppression camel’s back could come from a grassroots’ buying spree.
If one Warren Buffet or Bill Gates or giant pension fund doesn’t suddenly place a massive order for silver, maybe one or two million Americans might place a series of, say, $500 orders.
The likelihood that the Buffets of the world and the managed money funds will, out of the blue, change teams seems remote in the extreme. Why would “Big Money” interests want to do anything that jeopardizes the value of their fiat-dollar denominated portfolios?
Thus, as far as I can tell, any “revolution” in precious metals sentiment will have to be sparked - and then sustained - by the peons (card-carrying members of The Powerless that Be).
‘Buy Silver!’ Part 2?
I don’t know if any readers remember, but I first started writing silver articles for Internet sites two years ago when a few people started pushing a “Buy Silver” event.
I loved the possibilities of the campaign and immediately enlisted as a scribe volunteer.
To me the effort (if successful) might finally attract some mainstream media attention to the fact that while the price of silver was plummeting, demand for physical silver (from we peons) was going through the roof.
Alas (surprise! surprise!), the campaign never even registered a mention among mainstream media outlets.
I do think a fair amount of people did their part and “bought silver” on the specified day and, as I wrote at the time, the “worst” that could happen was that our effort would be ignored, but we would still add to our collection of silver (no bad thing there).
I also think the “grassroots” buying spree that took place during these days and weeks DID stun TPTB who were and are intent on slaying silver and gold “sentiment.”
In fact, even today they probably know that another 10 or 15 percent plunge in a day or two will almost certainly unleash another tidal wave of buying and perhaps risk a real physical shortage.
Maybe the next epic gold and silver knock-down will “backfire” even more.
Maybe the next take-down, as economically non-sensical as the last, will actually generate some mainstream media coverage to go along with the inevitable flood of orders.
If the right “talking head(s)” started to talk up silver, an “army” of one million might double to two million. And then two million people - skeptics of the “status quo”economic storyline and eager to expose this fraud - might become four million. And so on.
Of course I don’t think the real powers that be worry about such a scenario. After all, the magic of their “power” is their belief that they can always control what the masses think as well as how the masses act or don’t act.
But maybe they should worry.
This might be the only scenario that once and for all explodes a rigged system.
The Chinese are already buying gold and won’t stop. What if Mom and Pop Americans started joining them?
Talk about real change.
The key then (for fiat dollar defenders of the status quo) is to keep your fellow Rotarian or next door neighbor from seeing the world like some of us do.
It’s a given that Operation Destroy Sentiment (and Keep It Dead) will continue 24/7 to prevent such an uprising.
This is the Real Battle being waged behind the scenes. Yesterday. Today. Tomorrow.
Will precious metals disciples, resolve finally exhausted, finally raise the white flag or will they instead hold firm and even manage to recruit new volunteers to their ranks?
Will the number of people who keep buying precious metals keep growing, not just in China but in America, Canada, England and Germany?
Could the “Black Swan” event many people have been predicting actually be a (sustained) grassroots buying binge in, of all places, America?
Although I’d love to see this happen, I’m not predicting it. However, if such an event did occur it would probably qualify as a game-changer.
And, for the heck of it, I’ll throw this in: Just because the last “Buy Silver” grassroots event didn’t take off and soar doesn’t mean the next one won’t.
***
Bill Rice, Jr. is managing editor of The Montgomery (AL) Independent. He can be reached at: bill@montgomeryindependent.com
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