In a way, I'm glad I was born Levin and not Goldstein. Don't take me wrong. I have nothing against the Goldsteins. On the contrary. In fact, I even know one who is a true mensch, bless his heart!
It's the Gold part that I am not too enthusiastic about. As I jokingly say to my customers, if I didn't like the Stein part, why would I have become a diamond dealer? Right?
You may find my remarks very puzzling, but the truth of the matter is that I have always associated gold with fear. Sure it's shiny. Sure women like it. However, it is the kind of metal you hold, just in case loose monetary policy foments an inflation environment of astronomical proportions and then, as if by magic, you see your hard-earned gelt slowly evaporate into thin air. Why otherwise would you want to hold a currency which, in real terms, yields nothing? So, as far as I am concerned, it's a bit creepy. Like the Swiss frank or the Japanese yen.
If you found my remarks puzzling, I am the one who is truly puzzled. And what has been occupying my mind lately is one central question: why are so many Americans buying gold? For, if gold is a hedge against inflation, why is 10-year US Treasury Note under 3%, thus pointing, in the best case scenario, to desinflation or, in the worst, to deflation?
After many sleepless nights, I think I have come up with the answer. What we Americans are really worried about is the risk that, some time in the future, the US may default on its sovereign debt. That's why we always expressing our concerns about Greece. The same way that, for years, we kept telling the Europeans that we believed in a strong dollar, while secretly maintaining the dollar at artificially low levels. But, no, the currency manipulators were the Chinese. Who else otherwise?
