Rush Out and Buy Some Gold! Russia is Buying Gold!

I remember the good old days of the Cold War when the Russians were humorless robots who could always manage to catch James Bond, a British secret agent better known by his “License to Kill” number: 007.

But the clumsy, doltish Russians could never hold onto him, and in the process, a lot of Russian secret agents, soldiers, miscellaneous employees, assorted affiliates and innocent bystanders all died, usually in a blaze of gunfire or explosions of some kind.

As a young man, I remember it especially well because I noticed that Really Hot Babes (RHB) were always practically throwing themselves into James Bonds’ arms, talking in vague, strangely-forbidden double entendres, husky whispers promising pleasures a-plenty coming from Really Hot Babes (RHB) whose barely-parted, glistening red lips cried out to be kissed, hard, and your brawny arm roughly encircles her dainty waist, pulling her harder and harder against your manly chest as you kissed her, deeply, hungrily, dominating her with raw machismo until she is breathless with desire and crying out for more, begging, “James! Oh, James!” unlike Sandra.

You are probably wondering why I segue from James Bond, back to the evil Russians, then to Sandra, a teenage crush from years ago who, as it turns out, wanted to be kissed neither deeply nor hungrily, and who had a certain intense antipathy at being made breathless with desire, too, then to the Berlin Wall being taken down, then to the USSR collapsing under the weight of its stupidity and corruption, becoming just another of history’s failed experiments by another stupid country trying a ridiculous command-and-control economic system with a fiat currency, which always fail with the same disastrous result of ruining everyone and destroying the standard of living, rather than leaving the economy alone to experience the joys of free enterprise and capitalism with a stable currency anchored by gold, which always succeeds in providing a higher standard of living to everyone.

The reason I bring this up is that, apparently, these sneaky, vodka-swilling, Bond-fumbling, Rooskie bastards are up to something! I infer this from Ed Steer’s Gold & Silver Daily newsletter, which reports that the Russian Federation, as of July, “increased their gold holdings by a further 500,000 troy ounces, bringing their total holdings to date up to 23.3 million ounces… or 724.7 tonnes.”

In fact, he says, “So far this year they have socked away 2.8 million ounces of the stuff… over 10% of their entire holdings in just the last seven months! These guys are serious!!!”

Being a paranoid, scared, creepy little guy who is sure that We’re Freaking Doomed (WFD) by the staggering, massive creations of money by the Federal Reserve, especially so that the government can borrow the staggering, massive amounts of money to deficit-spend, increasing the national debt so that we slide inexorably into the economic black-hole of un-payable bankruptcy, receivership and ruination, I instantly recognize the wisdom of what these slippery Russians are doing, as emphasized by Mr. Steer’s clever use of three exclamation points! They’re buying gold!

And when you add up all the tons and tons of gold being bought up by banks and people and funds everywhere around the world, you can easily “connect the dots” to show that alien beings from outer space are shooting mysterious brain-control rays into our heads, aimed at us from their secret base under the north pole, which is where Santa Claus lives.

Or maybe it is Santa Claus himself shooting these strange rays at us. Or maybe it is even his mysterious wife, Mrs. Santa Claus, who strangely has no first name of her own, and for whom nothing else is known, as if she never existed until suddenly appearing as Santa’s wife. Strange, but true!

Anyway, the whole point is not that Santa Claus is a dangerous lunatic, or that Ben Bernanke of the Federal Reserve is a dangerous lunatic who actually believes his stupid neo-Keynesian econometric theories despite their utter, utter failure. I mean, look around! Does this seem to be the result of a good economic theory in the hands of competent people to you? Hahaha! Me neither!

No, the point is that these are indeed very weird times, and a lot of strange, terrifying, unbelievable, nonsensical, suicidal, desperation-fueled fiscal and monetary idiocies are going on, and new ones appear with each passing day.

I am So Freaked Out (SFO) that my tiny little brain can think of nothing better than buying gold, silver and oil, which is entirely fortunate for me and other tiny-brained guys out here who can never actually seem to grasp what is going on, much less understand it, because buying gold, silver and oil is exactly the right thing to do! Whee!

The Mogambo Guru
for The Daily Reckoning