Is It Tableware or a Leading Indicator? - New York Times: "But to a cadre of economists who use the price of gold as their crystal ball, those brides and grooms should not be the main object of our sympathy. The United States economy should be.
The boom in gold and silver, these economists say, is a sign that this country is finally going to pay for years of easy money, mounting debt, cheap Asian imports and trillion-dollar budget deficits. Welcome to your new job, Henry Paulson.
GOLD and silver have provided a reality check for profligate governments as far back as ancient Rome. Starting with the little-loved emperor Nero, Roman rulers began to use less and less metallic content in their coins so they could mint more money, as Peter L. Bernstein, the longtime Wall Street consultant, wrote in his book 'The Power of Gold' (Wiley, 2000).
When the Roman people figured out what was going on, the value of the coins began dropping rapidly. In one 44-year period, prices of everyday Roman items rose by a factor of 20. Only when the emperor Constantine issued a nearly pure new coin called the solidus did inflation come under control."
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