Friday, June 23, 2006

Jim Grant on gold

James Grant, Forbes columnist and editor of Grant's Interest Rate Observer has a few things to say about gold and central banking in his latest Forbes.com piece. In "Glitter", Mr. Grant gives us his view into how gold, inflation, and central banking are interrelated. An excerpt:

Gold competes with the Bernanke dollar, just as it did with the Greenspan dollar and just as it has with government-issued money since the invention of the printing press. The historical record is undebatable: 1) Currencies ultimately lose their value. 2) Gold is a lousy long-term investment. 3) Yet when markets lose confidence in paper, there is nothing quite like a Krugerrand.