-->

-->... das heutige Daily Reckoning.

"Buying gold is not as easy as buying stocks. Taking advantage of last week's trip to America, and a $25 per- ounce drop in the gold price, your editor decided to load up. But a call to one coin company went un-answered. Another informed us that Krugerrands were in short supply and could not be immediately delivered.

Your editor left America disappointed and empty handed. But his faith in gold was confirmed. No shortage of shares in Amazon.com nor GE has ever occurred. Nor has any lone biped with money in his pocket ever had any problem buying them.

If the shortage in Krugerrands persists, the South Africans will mint more of them. But they will not be able to create them out of thin air"at virtually no cost" (as Fed governor Ben Bernanke described dollar creation at the Bureau of Printing and Engraving). At current prices, each one-ounce coin costs about $364 and contains about $354 of gold. Plus, there is the actual cost of minting and distributing the coin.

Most investors and financial analysts are amazed that anyone would want to buy gold at all.

"It's mainly war talk that is driving gold higher," explains a report in the Detroit Free Press. Gold is thought to be the duct tape and plastic sheeting of the investment world - the last resort of the paranoid, the hysterical and the delusional.

Will the price of gold collapse after the 'quick and easy' war is over? We do not know. But yesterday the Bush administration asked for $95 billion to fund the war effort. This pushes the federal deficit to well over $1 billion per day. And there is the U.S. trade deficit, too - more than $1 billion per day. Where will all the money come from? Not from Krugerrands. Most likely, the Fed will create it...at virtually no cost to itself, but huge cost to dollar-based investors.

On September 10, 2001, an ounce of gold could be bought for $271.50 per ounce. The central banks of the world - the very same banks whom people believe to be capable of seeing into the future and improving it - were selling tons of it at this price. By February 2003, gold was selling for $100 more."