If Bernanke Doesn’t Think Gold Is Money, He Should Look At The Swiss Franc

Recently, Ben Bernanke went before congress to explain why his two round money printing bonanza known as “quantitative easing” hasn’t done a damn thing to turn around the US economy. During the question and answer session, Bernanke basically came out and said he does not think gold is money. In his mind, the only real money is the green toilet paper he has been rolling off the presses for the past several years.

However, the world markets seem to disagree. Today, the Swiss Franc rose to an all time high against the dollar, and is moving higher against all other currencies as well. What makes the Swiss Franc so special? Compared to every other currency in the world, Switzerland has the highest percentage of its money backed by gold.

As investors look around the world for a safe haven for their money, it appears that they believe a gold standard is a pretty safe and reliable system. In addition, the spot price of gold bullion itself is also at an all time high today.

Look at how wrong the markets are telling Bernanke his opinions are. If gold were merely just another commodity metal, like Bernanke thinks, the price would be dropping right now. He believes the price of gold should be based on the demand for manufacturing purposes, mainly jewelry and electronics. In a slowing global economy, gold is not dropping in price like the other commodity metals.

In fact, gold and silver are both ignoring any news of a global growth slowdown and skyrocketing in price. The only conclusion for this phenomenon is that investors know these metals are the true currency of the world. As the paper systems start to implode, people go back to what they know has real value.