The role of gold

More than just serving investors as safety temporary retirement for their money , gold is a relief valve for liquidity excess .

Markets indeed are very happy with as much liquidity as possible and in fact they know they are one of the main beneficiaries of an excess of liquidity .

It is because of that that markets are the strongest accomplices of imbalances such us the budget deficits .

The main problem of world economy is that most market speculators know very little about real economy and in their blindness are using the excess of liquidity to unconscioussly cause continuous bubbles that lead liquidity into captive cemeteries of money .

As this planet leaders would do anything but wait for bubbles to explode so captive liquidity is recovered , what they actually do is to print more and more money that adds to existing liquidity that sooner or later will make world economy to collapse .

This process of course needs inflation as main instrument and the consequence is a tremendous loss of purchassing power through salary contention and unemployment . The process is causing the continuous reduction of middle class without which , the necessary balance between offer and demand for a healthy economic evolution is simply impossible .

So , short of enough capable leaders gold suction of liquidity is the only wise instrument in the system .


Published in: on abril 24, 2011 at 6:30 pm  Deja un comentario  

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