2009-02-27seekingalpha.com

I talked to a number of fund managers and financial advisers and found out that some very deep pocket players (family office managers with assets in the multi billion $ range) are holding 0% (zero!) in gold. I’m asking myself if they have any idea about basic economics and any idea about how inflation does work. Just have a look at the quantity equation and you will find out that inflation is inevitable (in practice) once the velocity of money accelerates. All the money that is been shoveled into the system is not yet working (spent) but just sitting in some `accounts’. But once the spending cycle starts, and that’s what all the stimulus packages are intending, than inflation will come back furiously.



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