Sunday, May 21, 2017

San Francisco Fed Prez Tells High School Students Gold Irrelevant

On Friday, San Francisco Fed President John Williams told a group of high-school students at  El Camino High School in South San Francisco that the dollar was safe as the world's reserve currency and that gold is irrelevant to Fed monetary policy---which in a superficial way is accurate since the Fed hates gold and will talk about any other market indicator but gold.

Though you can be sure that while Williams and other Fed officials diss gold, they know very well where the price of gold is and watch it closely.

This has always been the case, I have been told by a person who was waiting in an ante-room to visit Paul Volcker when he was Fed chair that the first thing Volcker did when walking into the office was to ask his secretary for the gold quote.



  1. If gold is irrelevant to monetary policy, why does the Fed own so much of it? Shouldn't it sell all assets that are irrelevant to its core function?

    1. It doesn't matter until it does or, it's irrelevant until it's not.

  2. Coin Act of 1792:
    "Section 19. And be it further enacted, That if any of the gold or silver coins which shall be struck or coined at the said mint shall be debased or made worse as to the proportion of the fine gold or fine silver therein contained, or shall be of less weight or value than the same out to be pursuant to the directions of this act, through the default or with the connivance of any of the officers or persons who shall be employed at the said mint, for the purpose of profit or gain, or otherwise with a fraudulent intent, and if any of the said officers or persons shall embezzle any of the metals which shall at any time be committed to their charge for the purpose of being coined, or any of the coins which shall be struck or coined at the said mint, every such officer or person who shall commit any or either of the said offenses, shall be deemed guilty of felony, and shall suffer death."

    Fast forward to 2017:

    "Hi! I'm Janet Yellen and I just made 4 Trillion dollars in my spare time with my computer! Don't ask me how!"


  3. Has John "6 rate hikes in 2016" Williams made any similar predictions for 2017? It's pretty clear that this guy is sent out to say the opposite of the truth for any occasion.

  4. LOL if it's irrelevant, why even mention it? Hmmmmm...

  5. There is a simple change in dynamic now that is a precedent setting first in the world of metals. The real money -and thats what it is- for the first time is feeling the force of the corrupt trading on paper, leveraged to the hilt. not attached to any real metal, delivery system, is being skillfully manipulated to keep the prices in artificially controlled lows that has nullified precious metals as an investment.

    Let me repeat, the market corruption has undoubtedly turned gold from an investment to a purely static insurance asset in the mind of many. Its the only way Fiat maintains its illusion of value and vilifies the metals market enough to keep all but the die hards out of holding a position. The system will do anything to make sure the non-existent gold reaches a value that has to be delivered.

    Precious metals will only show their real value when our fiat crashes and the markets along with them. Its hard to envision what its value will be then.