Only Fools are Fooled by Fool’s Gold

In front of me (see picture) a beautiful piece of ever lasting gold that I just got almost for free, and now I can turn around and sell it for a fortune? is it that easy to make money? No it is not gold, it is Pyrite (iron sulfide FeS2) better known as fool’s gold. Many inexperienced gold diggers have through time been fooled by fool’s gold. Yes also fool’s gold is shiny and beautiful, but it is plentiful, it just iron sulfide. Anyone that has touched real gold knows the difference; real gold is much heavier, much shinier. Much more important all the gold ever mined from earth could be stored in a large barn. All gold in the world is in quantity (tons) the same as the US. Steel industry turns out in a few hours (See Bernstein "The Power of Gold: The History of an Obsession")

The price of Gold has passed $1000 per troy ounce, there is several reasons for this, first of all flight to quality, and yes even according to Greenspan Gold is a good indication of expected inflation. Inflation is closely linked to the printing press.

Today’s FIAT money system is backed with nothing but faith; the faith is again based on not printing too much money (keeping inflation under control). One of the widest measure of money supply is M3.

FED stopped reporting M3 back in 2006

According to several economists (private institutions) M3 has exploded to upside and is now at 12 to 18% annualized in USA. FIAT is more plentiful than even Fool’s gold.

Years back in the last global risk/position meeting I was invited (before leaving) I told Gold likely would explode and even could go to $1000, there was some laughter …

Can FED solve the fundamental problems of the economy by keep increasing the money supply? There are many opinions on this. Only time can tell, but it really helps if you know what exactly time is, and few do.

PS: Iron pyrite is by superstitious people believed to be a very protective stone. It should be carried when performing dangerous work. Most rational people would naturally think this is foolish, many of the same "rational" people could naturally not see the difference between fake gold and real gold if you put it in just front of them.