Gold Price Rise Masks Dollar's Hidden Decline
Jim Rickards, editor of Strategic Intelligence and author of MoneyGPT, recently spoke about the gold market. He argued that when gold prices rise, it's not necessarily because the metal itself has increased in value, but rather because the dollar has lost purchasing power.
Rickards pointed out that every major derivatives exchange rulebook gives its board emergency authority to restrict trading, including ordering 'liquidation only.' This means that even if you own a gold ETF or an unallocated gold account, your claim on gold is not guaranteed. Only allocated storage guarantees ownership of specific metal.
Historically, this has played out in significant events like the Hunt brothers' attempt to corner the silver market in 1980, when COMEX restricted trading to 'liquidation only.' Rickards emphasized that owning physical gold, specifically allocated storage, is a different story from holding claims on unallocated metal or buying ETF shares.