Provides today's liberal revenge fantasy has the treasury selling off it's gold stock, for the simple expedient of financially ruining the wingnuts. Let's go after the goldbugs by having the Treasury sell it's estimated 261 million ounces of gold!
That will fix those wingnuts! Drive the price down from today's about $ 1,100 per ounce to.. ?
Given the tremendous ad and news push running up gold, there's always the risk of a popped bubble as more folks sell. Prices move both ways (as I learned at great personal expense during the Nelson Bunker Hunt silver run in, I recall, the 80's. So, can gold go down? Can the government, at least in the short run, supress the price by selling off it's supply?
Technically, the U.S. Government's gold stock does not underpin the value of the dollar. Practically, I'm not sure that the Chinese – or others holding large amounts of U.S. Dollar denominated debt – would see it the same way.
So, what happens when we decide to spite the goldbugs? The international markets drop their dollar denominated holdings for the gold that the Treasury is selling.
Temporary gold price drop. Long term hit to Treasury securities, and U. S. Government borrowing costs.
And the goldbugs? Most are diversified, and will will perversely benefit in the long run from the collapse that Tom's suggesting.
Nice work Tom. Glad you're only the WSJ's court jester.