An hour with Jim Rickards and the once and future money

Section:

1a ET Friday, December 17, 2010

Dear Friend of GATA and Gold:

Market intelligence analyst James G. Rickards of research firm Omnis Inc. made a long presentation to the "Rethinking the Future International Security Environment" conference held Dec. 7 in Washington by the Applied Physics Laboratory of Johns Hopkins University. The second half of Rickards' presentation elaborated on his recent incisive observations about gold, as expressed at King World News and elsewhere.

Rickards told the Johns Hopkins conference that he considers gold to be the secret economic weapon of the U.S. government, and he noted that devaluing currencies against gold in times of economic distress has been done frequently throughout history.

He said he expects the United States to avert the dollar's collapse by returning it to a gold standard or even to avert the collapse of currencies worldwide by sponsoring a new gold-backed international currency, with gold revalued to perhaps $4,000 per ounce under either scenario. During the question period at the end of his presentation Rickards asserted that the paper gold markets in New York and London have sold claims to far more gold than the sellers possess or likely can obtain and that those markets will crash and resort to cash settlement if enough buyers ever try to take delivery. Of course that has been one of GATA's main arguments lately.

In regard to devaluation against gold, it may be time again to note the study published in 2006 by the British economist Peter Millar, "The Relevance and Importance of Gold in the World Monetary System." Millar argued as Rickards does while predicting gold's revaluation at a somewhat higher price. Millar's study can be found at GATA's Internet site here:

http://www.gata.org/node/4843

Rickards is a scholar and lawyer and described himself to the Johns Hopkins conference as a refugee from the bond market who converted to gold when he perceived how haywire things were going in the world financial system. (He got an especially close look as counsel to Long-Term Capital Management when it collapsed in 1998.) While his presentation is nearly two hours long, after the aggravatingly short segments given to him on business television it is a delight to have a chance to hear him lecture a bit. His reflections on gold begin at about 62 minutes into the video of his presentation, which is posted at the Internet site of the Applied Physics Laboratory of Johns Hopkins University here:

http://outerdnn.outer.jhuapl.edu/rethinking/VideoArchives/MrJamesGRickar...

Or try this abbreviated link:

http://tinyurl.com/37rlp8w

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.



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