[The year of the Great Unraveling - 2008 - provides a treasure trove of material at the old blog and selecting the month of April to reminisce (as has been done throughout my absence) provides some interesting insight to what people were thinking five or six months prior to the wheels falling off in the fall. For anyone thinking that 2011 is now "rhyming" a lot with 2008, pay close attention to the items that will appear here in the days ahead. As for today, what better way to start off this look back with this item about former Fed Chairman Alan Greenspan, originally published on April 2nd, 2008, who people were just starting to realize had made a real mess of things. It was not a good month for the former Maestro.]

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A number of you have sent links to the Barron’s story about former Fed Chairman Alan Greenspan’s mysterious doctoral thesis – thanks.

We’ll get to that in a minute.

As part of an email exchange with CR on this topic, the well-known piece of writing from 1967 came up – Gold and Economic Freedom – and, one thing led to another, ultimately resulting in the title of this post.

Not having read this piece in quite some time, save for the well-worn second to last paragraph that seems to pop up everywhere and begins, “In the absence of the gold standard, there is no way to protect savings from confiscation through inflation”, another quick read reveals a rather remarkable 40-year old:
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[During this stroll down memory lane while my wife and I travel to the East Coast and back, it seemed like a good idea to try and find one story that deals with precious metals for each of the years covered - 2005 through 2010. I didn't see anything for 2005, but since that was a whopping one month after the blog was launched, that's understandable. Here's one that was originally published on April 18th, 2007 - back when gold had been meandering around the $600 mark for a year and silver seemed stuck at about $13 an ounce. What you're about to read below about central bank gold sales in 2007 is particularly interesting in light of what's happened since that time - the IMF gold sales were snapped up by central banks in Asia and European central bank gold sales have come to a virtual halt.]

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After months of steady decline for the U.S. Dollar when measured against other floating currencies, the battle against the world’s oldest currency is now escalating.

It is a battle for the hearts and minds of much of the world’s population as an alternative to the dollar is sought – choose another country’s paper money or go with the world’s oldest money.

In years past, central bank selling of gold could always be relied upon to stop the flight away from paper money – when investors swapped their fiat money for gold bars, then saw the price of the metal drop as central bank bullion was dumped onto commodity exchanges, the metal’s price would plummet and a lesson was learned.

This has gone on for decades, but with more central banks in developing economies now buying bullion and with organizations such Germany’s Bundesbank balking at any future sales (apparently not having forgotten the lessons of their Weimar days 84 years ago), this may be coming to an end.

For years, commodity bull Jim Rogers has stated that the reason he views the yellow metal as just another commodity is because the world’s central bankshave too much of the stuff – they can continue to sell into the market to depress the price for many years.

Well, that may no longer be the case.

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