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By Robert Fitzwilson of The Portola Group

January 5 (King World News) - The Great Gold Robbery

The last time we saw a “Great Gold Robbery” was in 1855.  The equivalent of about $4 million in gold was stolen from a train moving between London and Boulogne, France.  The gold was packed into three boxes and secured with iron bars.  Those boxes were then placed into iron safes, loaded on the train, and then sent to France accompanied by an armed guard.  When the boxes arrived in France, most of the gold had been replaced with lead shot.  How did the criminals breach the various levels of security, particularly opening the safe with keys?  The obvious answer is an “inside job”....

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My how things have NOT changed.  We are going through the final chapters of what must now take the title as “The Greatest Gold Robbery”.  As with the first one, it required an inside job to accomplish, but the magnitude of the theft is breathtaking.  As massive amounts of gold continue to flow from West to East, what little gold remains is rapidly being depleted by both legitimate and illegitimate means.

As gold was discovered in the 1800s in faraway places such as California, Alaska and Australia, men, women and entire families left their lives behind to seek their fortunes in these new gold mining areas.  It truly was a fever.  Sailors abandoned their boats in San Francisco Bay to seek their fortune in the Sierra Foothills.  A huge number of people braved the perilous trips across the United States by land as well as the equally perilous trips around the tip of South America and across Central America.

In the United States, the concept of gold as money beats in the hearts of a small fraction of the population.  The gold confiscation in the 1930s and the elimination of silver in the remaining coinage in the mid-1960s did the trick.  The connection between precious metals and money was broken.

This is obviously not the case with much of the rest of the world.  There is a cultural fever in India to acquire gold and now silver due to the shameful attempt by the Indian government to restrict legitimate purchases as well as dramatically increase the cost.  The attempt has failed.  Smuggling of gold has skyrocketed since the restrictions were put in place.  On a recent flight to India it was discovered that every passenger was carrying a kilo of gold.

China is a completely different story.  Their government continues to encourage their citizens to acquire gold.  At the government level, the output from domestic mines as well as massive imports of gold continues to be locked away.  We have seen pictures of the crowds at the stores buying gold in a frenzied manner.  There truly is a “gold rush” mentality taking place in China. 

The governments and citizens of the Western countries will greatly regret their foolishness in trying to ignore the role of gold and its history as money.

The mainstream financial channels continue to function as propaganda outlets for the Central Planners.  If gold and silver decline, that headline is featured prominently, and guests are rounded up to confirm that the prices are heading even lower.  If gold and silver have a good day or good week, silence.  It is painfully obvious this is propaganda.

Precious metals and particularly the miners had another great week as well as the past two weeks.  The HUI showed a 5% performance for the week, while the Dow Jones Industrial Average and the Russell 2000 were flat.  The S&P 500 and the NASDAQ were negative for the week.  For the past two weeks, the HUI has outperformed the S&P 500 by a whopping 7%, yet all we hear are the headlines of how great the stock market is doing.  When it comes to precious metals and the miners, we either hear that prices are going lower or just simply the sounds of crickets in the night.

We also saw the precious metals rising along with the US dollar, which is unusual.  Up until recently, the dollar has been the currency of choice when investors want to hunker down.  In large part, it has to be as the sums looking for a haven are so huge.  We have been waiting for the moment when the institutions and the wealthy rediscover the historical safe haven of gold as well.  It has only been two trading sessions, but perhaps that day is close at hand.

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