Gold Outlook: Did Sir Alan Greenspan Just Hint at a Coming Gold Standard?

Gold OutlookHere Is the Craziest Gold Story You’ve Ever Read…

Fasten your seatbelts.

Because, even if you consider yourself open-minded and well-read on topics the “MSM” (mainstream media) avoid, this is still going to blow your socks off.

Recently, none other than Sir Alan Greenspan, the former Fed chair—and the man most often blamed for creating the mess that the entire world is currently in—did an interview so remarkable and so bizarre, that it literally staggers the imagination. In the interview, which was directly after the notorious Brexit vote, Greenspan not only predicted that “the worst was yet to come,” but clearly and unambiguously blamed the current economic problems on the United States’ abandonment of the gold standard in 1913. And—you need to be sitting down for this!—Greenspan also said that everything could be fixed if we simply brought gold back into the system…?

(A position made even more remarkable by the fact that [see my previous editorials in Profit Confidential] most experts directly hold the Fed, the U.S. Treasury, and Washington’s top-secret Exchange Stabilization Fund [ESF] directly responsible for suppressing gold prices in the first place—most blatantly during the 1990s and, most recently, during the historically brutish 2011–2015 gold bear.)

Wait, it gets even better!

Following that extraordinary interview with Sir Alan Greenspan, a well-respected essayist and precious metals commentator named Bix Weir immediately penned a series of op-eds basically saying “I told you so” and referencing his ongoing, multi-year analysis of a totally bizarre comic book from the Federal Reserve (not a misprint—an actual comic book!) first printed in 1981 and, even more astonishingly, fully reprinted in 2007.

If you consider this story of possible interest, I will provide the references for you below and encourage you to do your own research. Although some consider my own views on gold perhaps a little oversized, they are puny and insignificant compared to this brand-new “conspiracy theory.” A conspiracy theory so outrageous that the only thing more outrageous is the possibility that there may actually be a grain of truth to it!

So Here Is What Happened…

  1. We start with the Brexit. Thousands of writers and analysts around the globe have already taken their sharpest pencils to paper and dissected the event to its smallest detail. It is not my intention to compete with them. I will, however, comment that the actual result caught virtually the whole world by surprise. I will suggest that you can count on the fingers of one hand everyone who correctly predicted the outcome in advance of the actual event. I will also underscore the fact that Britain, for whatever reason, has not entered into the passionate love affair with electronic voting tools that the U.S. has and the counting of the Brexit vote count was done by hand by local volunteers.

(For many years, the U.S., a self-declared bastion of democracy and fairness, has relied on electronic voting run via privately controlled machines using privately controlled software. This should not be a problem, generally, if there is no outside interference. Yet for literally decades, professional statisticians have noted that U.S. exit polling—which should be the most statistically reliable predictor of a vote outcome—often yields a different result than the machines…? The most recent “eyebrow-raising” instance was the Clinton/Sanders skirmish in New York. There have been many others. (Sources: “Why Bernie May Have Actually Won New York,” Reddit, April 23, 2016; “Hacking Democracy,” Wikipedia, last accessed June 26, 2016.)

  1. On the afternoon immediately following the Brexit vote, CNBC conducted an interview with Sir Alan Greenspan, wherein, according to observers, the former Fed chair “stunned” the interviewer with his comments:

“[…] This is the worst period I recall since I’ve been in public service. There’s nothing like it, including the crisis—remember October 19, 1987, when the Dow went down by a record amount 23 percent? That I thought was the bottom of all potential problems. This has a corrosive effect that will not go away. I’d love to find something positive to say.

“[…] I would not be surprised to see the next unexpected move to be on the inflation side. You don’t have inflation now. And you don’t have it until it happens.

“[…] If we went back on the gold standard and we adhered to the actual structure of the gold standard as it existed prior to 1913, we’d be fine. Remember that the period 1870 to 1913 was one of the most aggressive periods economically that we’ve had in the United States, and that was a golden period of the gold standard. I’m known as a gold bug and everyone laughs at me, but why do central banks own gold now?” (Source: “Greenspan Urges Return to Gold Standard,” Zerohedge, June 27, 2016; emphasis added.)

  1. Following the above, essayist Bix Weir—who has actually created an entire web site devoted to his unusual views on gold and the Fed—stands up to take credit for “predicting” that something similar to Greenspan’s comments was already overdue from a Fed spokesman in this current period and, moreover, that all this is consistent with his ongoing analysis of an oddball comic book that the Boston Fed published in 1981 and recently republished (with very few changes) in 2007.

If you are not familiar with this particular comic book or Weir’s interpretation of it, you may be readily forgiven. The vast majority of investors—gold bugs included—have never heard of it. And those who have are not only disinclined to accept its significance but—even in a community well-known for extreme views!—have dismissed it completely.

What exactly is Mr. Weir’s theory, you ask, a theory so extraordinary that even pro-gold essayists avoid it? It breaks down more or less as follows and, once again, I encourage each reader to do his own her own analysis:

* Although not recognized as a publisher either of scholastic materials for children or graphic novels, the Boston Fed nonetheless took the time and trouble to publish a full-length comic book in 1981 entitled “The Road to Roota.” It is a work clearly intended for much younger readers, at least superficially.

* To make it clear that this unprecedented 1981 event was not an error or aberration, the Fed republished this very same work, with a few small changes, 26 years later, in 2007.

* Weir not only spent literally years studying this work—and the small differences between the first and second editions—but may (arguably) be the only person not directly associated with its publication (i.e., not working for the Fed) to have spent so much time on it under any circumstances, anywhere.

* As a result of his efforts, Weir, using deductive reasoning so sharp it might make even Sherlock Holmes blush, arrived at several conclusions. One of those conclusions was that either the Fed itself or the ownership cartel behind the Fed, which is a fully private organization, has embarked on a multi-decade, long-term plan to push the world economy to the brink via unbacked paper currency. His second, and even more astounding, conclusion was that once the limits of fiat currency were reached and once oil was no longer recognized as a viable backing for paper money, the notion of a gold-backed currency would be retrieved from the dustbin of history and all would be well with the world once again. (Sources: “Was Bix Weir Right?,” Silverdoctors, June 27, 2016; “Bix Weir’s Road to Roota,” RoadtoRoota.com, last accessed June 17, 2016.)

* Given the many years Weir has spent dissecting these two extraordinary Fed publications, it would be a disservice to both him and to the reader for me to try to replicate his extensive work in this short abstract. I will, however, say that for those who approach the topic with an open mind, there is indeed something here worth looking at.

(In broad terms, the story is about a magical land where the people are unhappy because there are no colors, everything is in black and white. The title of the work, suggests Weir, is a reference to “Root-A,” which, to a computer programmer, is the first and most critical level of any program. Weir also notes that, although most people are unaware, Sir Alan is not merely a computer programmer in his own right, but is “the” individual singly responsible for taking the Fed into the computer age and developing the original financial algos that now run the entire planet. Greenspan even appeared in a TV ad for Apple computers—decades ago—because of his known skill as a programmer and coder! In this sad magical village without color, the inhabitants try many different solutions—including one that looks suspiciously like using petroleum to solve their problem!—but only achieve success when they bring the “golden light” back into their community. [Source: Ibid.])

And Here Is Your Writer’s Two Cents…

Since I started writing about gold for Profit Confidential—you can access my complete archive here—my views have, I believe, been considered both aggressive and accurate.

My own view remains that, at this point in time, gold’s main “friend” remains China, along with the upcoming new power bloc in Eurasia that China is forming to politely but firmly end its dependence on the U.S. dollar once and for all.

Prior to Sir Alan Greenspan’s post-Brexit interview, I was in fact already familiar with Weir’s dissection of the Fed’s one and only foray into comic book publishing—a comic book with so many layers that it, arguably, makes The Da Vinci Code seem as straightforward as a weather report!

Overall, I agree with Weir that this astounding interview from an ex-Fed chair suggesting gold might come back into the system is indeed a potential bulwark for Weir’s unusual theory and a predictive “hit” he can take proper credit for.

Yet, at this date, I remain wary of the Fed and its ongoing shenanigans. The central banks have, in our lifetimes, interfered in the workings of the free market on a scale so unimaginable that, if a Hollywood writer would have originally suggested it, the script would have been instantly rejected as too implausible.

Think about that.

Zombies, maybe. Aliens from space, no problem. Destruction of all free markets in full view of the world stage? Surely you jest.

In my mind, if the Fed really does want to bring back the gold standard—after taking the world monetary system to the very brink of collapse—they will have to stand in line because China and its new power bloc got there first.

(Addendum: Just as I was finishing this essay, commentator Jim Willie did an interview in which he opined that Sir Alan Greenspan, a lifetime spokesperson for the central bank cabal, is “positioning” his employers  for a possible last-minute gold backing to their IMF “basket.” According to Willie, this is an attempt to co-opt or front run the coming move to a gold-backed currency by the Eurasian bloc, led by China. A gold-backed system run by the IMF will allow the Western central banks to maintain their iron-fisted control; a system run by China and its allies, likely based on gold-backed trade notes, will not. [Source: “Willie: Deutsche Bank Only 2-3 Months Left,” Silverdoctors, July 3, 2016.])

Image Source: Flickr; Image copyright 2015, Brookings Institution