Quote of the Day: Negative Real Rates: The Biggest Legal Robbery ever in Human History

The real interest rate is probably minus 2% in the world today. It should be in line with the per capita income growth rate or 1%. The difference is 3%.

This environment redistributes wealth from savers to debtors on a scale of over $2 trillion per annum or $55 billion per day. This must be the biggest legal robbery ever in human history. But it is always coded in arcane academic lingos spoken by respected central bankers with impeccable CVs. All that is just packaging; it is robbery nevertheless.

This is from former Morgan Stanley economic analyst Andy Xie at the Marketwatch arguing that gold remains the ultimate hedge against the inflation thievery.

Mr. Xie’s fascinating article comes with his take that the sharp decline of gold prices will be temporary and gold will “rise to new heights soon”. This is because the masses will gravitate to gold because it is “the best weapon for the little guy to fight central banks that help a few to rob many.” 

Yes, the transfer of reserves from Wall Street to the physical real gold market will be the main driver of this, overtime. The physical gold market will also expose all the manipulative schemes by the Wall Street-government cabal.

He also says that people shouldn’t be deceived by the objection that “gold doesn’t bear interest”, because “paintings or antiques don’t bear interest either”. Mr. Xie concludes, “When money supply is rising, anything scarce tends to rise in value. Gold is the best scarce commodity in the world.”

Gold, indeed is the best weapon against the government rapacity.