Sprout-less Gold Tier 1 Capital?
Richard (Rick) Mills
Ahead of the Herd
As a general rule, the most successful man in life is the man who has the best information
Institutional investors tend to prefer investments that are thought to contain the potential for growth, growth = sprouts. An investment has to produce a growing revenue stream - if it doesn’t grow it doesn’t compound. Gold is rejected as an investment because it doesn’t produce sprouts, meaning the steady income and systematic growth so sought after by institutional investors just isn’t there.
Gold performs two jobs that fiat currencies, or any other financial innovation, cannot do; gold acts as a safe haven in times of turmoil - to escape Nazi Germany, or buy food and water in a crisis. Perhaps even more important, gold, for the last couple of thousand years has acted to preserve your purchasing power. In 1913 (the year the US Federal Reserve was born) the US dollar was well a dollar, gold was US$20 an ounce. Today, at almost the 100 year anniversary of the Fed the dollar has lost 95 percent of its purchasing power and gold is $1600 an ounce.
That’s gold, sprout-less yes, but irreplaceable in its functions.
Because of the upcoming massive debt rollover, and a collapse of faith in traditional collateral values, gold is quickly becoming a core banking asset.
https://aheadoftheherd.com/Newsletter/2012/Sprout-Less-Gold-Tier-1-Capital.htm