New Faces in Gold Spaces

01 Sep

New Faces in Gold Spaces

We’ve Spotted a New and Important Trend!

We commented last month about gold skeptic Warren Buffett’s turn toward gold (see HERE and HERE).  It was a surprise move, but one we found very telling.

Now there is another face in the gold space, one that we find equally significant.  Last week the Ohio Police & Fire Pension Fund decided to allocate five percent of its $15.65 billion portfolio to gold.  

It’s the early evidence of a trend.  

Public pension funds are not thought of as pioneers.  They are generally conservative, traditional stock and bond investors.  

But apparently their advisors and board members are, like Buffett’s Berkshire Hathaway, reading the signs of these financially trouble times.  

That’s why they have turned to gold. 

College endowment funds are much like public pension funds.  But some years ago, the University of Texas took the plunge.  The University of Texas Investment Management Corporation, one if the nation’s largest college endowment funds invested a billion dollars in gold bullion.  It bought 6,643 gold bars, storing them in some underground depository in New York.

Good move.  There average price was much lower than today’s price.  

Texas legislators wondered why Texans’ gold should be held in New York. It’s the same thing that foreign nation gold owners like Germany had begun wondering.  They started having their gold shipped home from places like the US and London.  Everyone was too polite to say it was a matter of trust, but they brought their gold home anyway.

So, without saying anything about trust either, the Texas legislature decided to build a depository in Texas.  Now the Texas Bullion Depository is open, with a gold capacity of more than $100 billion and security said to rival that of Fort Knox.

It’s a trend.  Gold is becoming much more important to people everywhere as well as to foreign governments.  They all wisely want it in their own possession.  Gold is becoming much more important to central banks as we have reported on repeatedly.  

So now its Berkshire Hathaway.  And public pension funds.  It’s a sign of the times.  More and more people are recognizing that the US is actually facing solvency issues.  For the time being, the Fed has been able to fill the budget gap with money-printing.  But there is a cost to that kind of legal counterfeiting, too.  

It will show up before long in the value of the dollar and a reluctance by foreign nations to keep funding US debt.

If you have not yet investigated the reasons for this new move to gold, we invite you to contact us at Republic Monetary Exchange.  One of our gold and silver professionals with be happy to spend time with you, describe what is behind this new trend, and answer all your questions.

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