Gold Will Plummet to $500! Charles Ponzi and I Believe It.

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Gary Christenson - Deviant Investor

Yup, that is the story. The following arguments explain why Charles and I think gold will plummet to around $500 per ounce. Also, after my luncheon date with Elvis, I have a large bridge for sale. If you are interested and willing to make a SERIOUS OFFER, see below.

The price of gold has roughly followed (up, up, and away) the growth of the U.S. national debt since 1971. The national debt is rising like 8% per year or like $1,000,000,000,000 per year. But don’t jump to the conclusion that gold prices will continue rising along with the debt! Charles Ponzi and I have faith in congress, lobbyists, and the sincerity of the budget process. We believe the national debt will rapidly fall due to the positive economic stimulus from ObamaCare, from actual budget cuts, and therefore gold should drop to new lows. Mr. Ponzi thinks it could go real low – like $450 or $500.

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The other day an out-of-work economist friend and I had lunch. He is a bright guy and he used to work for one of them central banks, or maybe a rating agency, or the IMF. Anyway, the subject of economic forecasting came up, he got this “far-away” look in his eyes, and he started babbling. Perspiration formed on his forehead, and his left eye started twitching. The mood was weird, like really, really strange. I ordered a fourth martini for each of us and gently suggested, “Show me how it is done.” He pulled out a handful of bones from his coat pocket and tossed them onto the table. He babbled something about magic Emu bones from the 19th century. Then his eyes bugged open wide and he started panting. He studied the bones for at least a minute and then pronounced, with a slur in his raspy voice, gold will drop to $496 by the end of 2014. Now folks, that was the most compelling forecast I have ever heard. Gold is going much lower, say to $496, fairly soon. Believe it!

It has been widely reported that nearly 50,000,000 people in the U.S. are receiving food stamps or, as it is now called, the SNAP program. I figure those people need the program to help buy food, and that means their job market is still weak. No jobs, no excess cash. No excess cash, no gold purchases by food stamp recipients. No gold purchases, and the price drops. Simple! This is one more reason why the price of gold will drop much lower – back down to the $450 – $550 range.

I read that the recent agreement with Iran was a breakthrough in middle-east politics – sort of a win-win for all parties involved, except for maybe the native tribes of northern Canada. I checked my perception with a bartender friend who works in D.C. where congressional staffers get drunk and hustle lobbyist funding. Based on what he overheard from staffers, he agreed. But I needed confirmation, so I called the White House and read several editorials in liberal newspapers and they all confirmed the triumphant break-through. Stay with me here! If the mid-east problems are solved and the political premium on the price of crude disappears, then gasoline will be a lot less expensive, people will have more confidence in the economy, and, like totally obviously, they will sell gold and buy lots more stuff. I figured I had another big winner – sell gold, sell oil company stocks, and buy consumer stocks. This new mid-east agreement is another big reason why I think gold will drop below $550 per ounce in the upcoming year.

Congressional approval ratings are so bad that I bet I can find more people who have had lunch with Elvis than who think congress is doing a bang-up good job. I figure it is high time for Elvis to make a comeback national tour and for congress to better manage the economy and the dollar. Hence, gold should drop to new lows. Look for $450 – $500 and a new Elvis love song.

Everybody knows the Chinese have been buying all the gold they can grab for the past several years. Even with all their buying, the price of gold has dropped a bunch. Now this is simple – if the price dropped when the Chinese were aggressively buying, how much further will it drop when they slow their buying or totally stop buying gold? Why do I think the Chinese will stop buying gold? Simple – they have bought so much in the past five years, they gotta stop soon – the world might even run out of gold. I figure 2014 is the year they give up on gold purchases and that will cause the price of gold to plummet, maybe even below $400.

I also saw an article in a newspaper called the “D.C. Rag” about a new gold rush. The story ranted on about this scandal of insider democrats buying land in California. They didn’t want the land but they wanted the massive deposit of gold that had been recently discovered there in a shallow mine. The “Rag” mentioned that the only problem was the area was overrun by the native Sasquatches, but I’m confident those congressmen will figure something out and get the gold. More gold mined, more supply, lower prices! This stuff is not difficult. Gold is going down!

So there you have it! Gold is gonna drop hard in 2014. Why? Simple! The national debt will go down because Charles Ponzi believes ObamaCare is a good plan and that congress will cut the budget and actually produce a surplus, a weak job market is limiting gold purchases by the people on food stamps, an economist predicted that gold will drop to $496 in 2014, we expect peace in the mid-east, the Chinese will reduce their purchases of gold in 2014, and a new supply of gold has been discovered in the Sasquatch zone of California. I figure it is “an open and shut case.” Gold prices are going through the floor, and I just proved it, with help from Elvis, Charles Ponzi, my economist and bartender friends, and simple logic.

Now, about that bridge I have for sale, I can give you a 30% discount if you act today. Serious offers only! Send your information requests to:

GE Christenson
aka Deviant Investor

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41 thoughts on “Gold Will Plummet to $500! Charles Ponzi and I Believe It.

  1. It has been almost a year since the last comment, silver is down to where I got in a few yrs back and currently looking at gold as a lighter way to transport wealth. There is a lot of cross talk as to the direction of the price. Are there any new developments to add to the conversation to help me determine if I should sell AIG and buy gold?

    small fish hoping to grow big one day.

  2. China has signed currency swap contracts on the yuan with all countries except Japan and the U.S.. In 2016 the U.S. will no longer buy oil abroad, and 2022 yuan will replace the U.S. dollar as the world’s reserve currency. Gold will rise in price, it starts fiduciary money.
    Fiatnye currency short-lived, with an average of 50 years. Time the U.S. dollar as currency fiatnoy coming to an end. If the U.S. would not be such a broad censorship on specific information, the Americans would have been informed.

  3. Maybe you are right, when goldbuyers in the US are important for the price of gold. But US citizens are not.

    China, India and Russia take the gold. These guys took every gram of gold beneath $1000.

    The US must watch their gold otherwise it is gone forever. Look at the EU-countries, most of their gold is already gone.

    Watch out for the Indian citizen gold vacuum cleaner…..!!!
    Soon they come online again.

  4. nail biting time. if gold plunges to 350 per oz. I will break even. China? Naw, they don’t really mistrust the good ole USA.
    Naw, they are not really planning to circumvent the petrodollar, naw, they would not dooooo that. right.

  5. Erich, I agree gold was not a good buy when it got to $800. I also stopped buying then. I also am looking at possibly buying into a dip into the $450-550 area. I feel we will be looking at oil at $20-40USD, in line with 1980s prices. There is a glut of oil, it is practically exploding out of the ground.


    just listen to this guy lmao

    are you mkultra? lol

  6. Hello,

    I read with great surprise an article by Mr C. Ponzi indicating a collapse in the price of Gold. I am in the Banking business for over 25 years have been investing in Gold with success and I honestly believe you have it wrong. Cannot tell exaclly when but the price of gold will be sky rocketing and all those who have been negative, for their own reasons, will definately be in for a surprise. Just study what is going on and I am sure you will re evaluate.

    Thank you very much

    • Thank you for your comments. I agree with you. Mr. Ponzi, as quoted in the article, is probably quite incorrect. I think $500 gold is ancient and never to be repeated history.

      GE Christenson
      aka Deviant Investor

  7. Well, I have bad news for Mr. Ponzi. Looks like gold will make a SIGNIFICANT bottom this month and head into a multi-year rally. Sorry Mr. Ponzi, not $500 gold, more like $2,000 gold.

    • I think you are correct and “Mr. Ponzi” is wrong. As a confession, I did not actually speak to him, I just used him as a reference to our Ponzi monetary system. And yes, I think $500 gold is about as likely as me selling that large bridge. I do see $2000 gold as highly likely, probably in 2014 and certainly before the end of 2015. We shall see.

  8. Oh, alright, I’ll give my two cents. In 2006, when the POG was under $400… after I took notice of the ’99 and ’01 double bottom and began moving my investoriate into the yellow dog (I positioned heavily in GFI in 2001, the number one gold stock in the number one sector- real estate was second in 2001), but in 2006 in an article entitled, ‘Yuletide Nuttiness… and $2,500 Gold’, I was the first metals analyst in the world to anticipate, in writing, a gold break out above $2,000. I challenge anyone to find an earlier documentation. I later refined that to $2,100 in a separate written and published analysis, comparing inflation with an average basket of grocery goods post 1971 ‘Nixon Shock’.

    At that time (2001) I outlined three eventual outcomes for gold. One I forget now. One was a ‘hold out’ closure of the gold window as prices went exorbitant (e.g. in a dollar repudiation). One was a complete deflationary collapse (as an aside, I suspect that the Fed will raise rates between meetings and orchestrate a deflationary collapse, reinstating the old status quo and feudal banking system, you heard it here first). In such a collapse, my chart hugging on Platinum, 50 times more rare than gold, could drop to $300 so gold can go from there.

    But this much is certain, on the way to the ‘outcome’. And I have never been wrong in gold, buying all the dips to the dollar, not difficult however in a bull market when you are buying the apex of ‘coiled spring’ formations and the resolutions of Broadening Tops. Gold is going below $700 to the ounce, where my next purchase will be (my group’s average accumulation price is around $550). I quit buying in 2008 and moved my clients into platinum at $800 in light of this fact. Gold is in one huge Broadening Top (higher highs and lower lows), and these are NEVER wrong (I have studied hundreds) except for a company/stock buy-out, and the second ‘lower low’ for gold long term is around $700, so we have to punch through that (WE HAVE TO), although I should like to pen an essay concerning the effects and possible skew of the ‘inflationary Fed plateau’ built into the price from monetary largesse, and the loss of dollar ‘validity’ altogether, meaning the whole game has changed (the skew becomes the secular). In time perhaps.

    Good luck all,
    Erich Simon, MBA

    • Thank you for your comments. You may be correct about gold dropping to around $700 but I think it is highly unlikely. We will see if the powers-that-be can arrange for a further drop of that magnitude, or not.

      GE Christenson
      aka Deviant Investor

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