Editor’s Note: In today’s special Daily, we’re pleased to welcome back Strategic Intelligence editor (and currency collapse expert) Jim Rickards.

Last week, Jim showed us how Warren Buffett’s recent actions may be pointing to disaster ahead. Today, he reveals the real reason world economies have been “keeping the lid on the price of gold”… and how that reason will lead us to self-destruction…


From Jim Rickards, editor, Strategic Intelligence: China’s gold reserves are officially about 0.7% of GDP. Unofficially, if you give the Chinese credit for having, let’s say, 4,000 tons, it raises them up to the U.S. and Russian level… but they want to actually get higher than that because their economy is growing.

Here’s the problem: If you took the lid off of gold, ended the price manipulation, and let gold find its level, China would be left in the dust. It wouldn’t have enough gold relative to the other countries, and because the price of gold would be skyrocketing, China could never acquire it fast enough. It could never catch up. All the other countries would be on the bus while the Chinese would be off.

China’s the second-largest economy in the world, even with its recent slowdown. It has to be on the bus. That’s why the global effort has been to keep the lid on the price of gold through manipulation. I tell people if I were running the manipulation, I’d be embarrassed because it’s so obvious at this point.

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Rickards: The Case for “Penny Gold”—[“Not Safe for TV”]

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If you’ve seen me on CNBC, the History Channel, or read my new book…

You likely know that I firmly believe gold will soon reach $10,000/oz.

But here’s what I didn’t tell them…

I’ve discovered how you could have turned every $1 move in gold into $192 of pure profit.

Here’s the case for “Penny Gold.”

The price is being suppressed until China gets the gold they need. Once China gets the right amount of gold, the cap on gold’s price can come off. At that point, it doesn’t matter where gold goes because all the major countries will be in the same boat. As of right now, however, they’re not… so China has to catch up.

There is statistical, anecdotal, and forensic evidence piling up for this. All of it is very clear. I’ve also spoken to members of Congress, the intelligence community, the defense community, and very senior people at the IMF about it.

The U.S. would like to maintain a dollar standard. Meanwhile, China feels extremely vulnerable to the dollar. If we devalue the dollar, that’s an enormous loss to the Chinese.

That’s why, behind the scenes, the U.S. needs to keep China happy. One way to do that is to let China get the gold. That way, China feels comfortable.

If China has all paper and no gold, and we inflate the paper, they lose. But if they have a mix of paper and gold, and we inflate the paper, they’ll make it up on the gold. So they have to get to that hedged position. At that point, maybe we’ll still have a stable dollar.

The system’s going to collapse before we get from here to there. At that point, it’s going to be a mad scramble to get gold.

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Reeves’ Note: Jim’s geopolitical prediction is a catastrophe waiting to happen. It’s one of the reasons we’ve been “pounding the table” on owning gold as a “chaos hedge.” But don’t buy a single ounce of gold—even as wealth insurance—before you read this

Jim’s discovered a way to turn small gold investments into massive moneymaking opportunities. It’s a window in the gold market that’s opened at least four times over the past four decades. And today’s window is open right now… Click here to learn more.