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New Commentary by John Ambrose Goodwin Hathaway - Reg Howe

Section: Essays

T. S. Eliot wrote ("Philip Massinger," The Second Wood,1920): "Immature poets imitate; mature poets steal." The famous literary critic Lionel Trilling gave Eliot at least one good review, writing in the September 1962 edition of Esquire (as quoted in The International Thesaurus of Quotations (Harper Collins, 1996), p. 508, and in R. Andrews, Famous Lines: The Columbia Dictionary of Familiar Quotations (Columbia Univ. Press, 1997), p. 368): "Immature artists imitate. Mature artists steal."

The bull market in gold must be starting to mature. Relying heavily on GATA's research, John Hathaway's most recent essay makes The Investment Case for Gold, but at least in its initial version posted yesterday gave no credit whatsoever to GATA. The following acknowledgment appears at the end of a revised version posted today: "The following web sites were helpful in the preparation of this article, and are excellent resources for additional information on the gold market, especially with regard to the issue of gold price manipulation:;; and"

While this acknowledgement may have corrected some of the offense to the Cafe and GATA, it is inadequate as far the proprietor of this website is concerned. The words "Copyright 1999, 2000, 2001 - Reginald H. Howe" on my home page, now updated to include the current year as well, are not merely decorative. Admittedly, taking material from The Golden Sextant without appropriate attribution is scarcely trafficking in stolen art. What is more, efforts to make the gold story more understandable to ordinary readers should be encouraged. But, as recent incidents involving historians Stephen E. Ambrose and Doris Kearns Goodwin have shown, writing for the mass market does not make plagiarism acceptable (or legal).

Particularly in the social sciences, appropriate and accurate citations are about more than merely giving credit where credit is due. They permit readers to do their own research into the same source materials. Mr. Hathaway's recent essay includes two charts from this site for which his readers might like URL's far more precise than a link to the home page.

The first of these charts presents the Dow/Gold ratio from 1915 to 2001, but with no explanation for the grey versus white shadings distinguishing different time periods. This chart, which comes from a publication by Golden Sextant Advisors LLC, was posted here as part of a short commentary entitled The Dow/Gold Ratio and the International Monetary Order. The shadings identify the different international monetary regimes of the past century. Their juxtaposition with the Dow/Gold ratio was intended to illustrate that official interventions to suppress gold prices during conditions of excessive monetary growth preceded the breakdown of both the gold exchange standard and the Bretton Woods system while at the same time driving the Dow/Gold ratio to unsustainable highs.

The second chart was extracted complete with title from my commentary dated August 13, 2001: Gibson's Paradox Revisited: Professor Summers Analyzes Gold Prices. According to the 1988 article by Barsky and Summers analyzed in depth in that commentary, Gibson's paradox operates in a truly free gold market as it did under the gold standard. Accordingly, gold prices should move inversely to real long-term interest rates, falling when rates rise and rising when they fall. To test this proposition, particularly for the period after 1984 not covered by Barsky and Summers, I requested Nick Laird, proprietor of, to prepare a chart which I titled: "Gibson's Paradox Revisited."

While the revised version of Mr. Hathaway's essay appropriately credits Nick for his work on the chart, nowhere does it indicate that the chart was my idea and constructed to my specifications to support my analysis of the article by Barsky and Summers. Nor does Mr. Hathaway provide a full citation to their article: "Gibson's Paradox and the Gold Standard," Journal of Political Economy (vol. 96, June 1988, pp. 528-550). Since these oversights did not mar his prior essay, Gold As Theater, which also incorporated with my express permission the Gibson's paradox chart, perhaps they can be attributed to inadvertence or misunderstanding.

Of course, I am pleased that a gold analyst of Mr. Hathaway's standing believes that "there is no more powerful evidence to support the notion that the gold price has been rigged than [the Gibson's paradox chart]." And I hope that someday a jury will get a chance to come to the same conclusion. If, as Seneca the Younger observed ("On Old Age," Moral Letters to Lucilius, 12.11, tr. Richard M Gummere, 1918), "The best ideas are common property," GATA's many researchers may take pride in the increasing acceptance of their findings on Wall Street. To the extent that Mr. Hathaway's essay reflects and reinforces GATA's work, it should help to break the chains on the gold market.

But next time that I have occasion to hoist a cold one in company with John, who really can be pretty good fun, I will guard my glass and recall these lines learned today from La Coupe et les lèvres (1821) by Alfred de Musset:

Je haïs comme la mort l'état de plagiaire;
Mon verre n'est pas grand mais je bois dans mon verre.

(A rough and rather literal translation:

I hate like death the state of the plagiarist;
My glass is not big but I drink from my glass.)