Some of you might remember a famous story back in November 2007, when Victoria Secret supermodel Giselle Bundchen wanted to be paid in euros over dollars, as the dollar was in a horrible rut. Of course we know what happened over the next year and a half as the world’s financial system was crushed and everyone ran to ‘perceived’ safety (the dollar). The euro was hit very hard, and we essentially had the Giselle top in that currency. Now of course post crisis, with the Fed dropping money from helicopters, the dollar has returned to its post of ‘world’s biggest loser’ – but it’s all about time frames.
An interesting story along those same lines, when Donald Trump decided to accept gold, rather than U.S. dollars, as a lease deposit from one of his tenants. Now to be fair, the tenant is a precious metal dealer but it is a very similar setup to the Giselle story. I did remark last week that gold may have put in a double top on the chart, and thus far it has remained weak – despite further actions from central banks (hinted or promised) coming down the pike.
Much like the debasement of the dollar, that doesn’t mean the long term trend is changing for gold – but it might be a strong market of an intermediate change of direction. As Marc Faber said – as long as Ben Bernanke is Fed chief, gold will be a good investment long term. We’ll check back in 6 months. ;)
- ….for the first time ever, Trump will accept today gold bullion instead of dollars for a lease deposit from his newest tenant in one of his marquee properties, 40 Wall Street, a 70-story skyscraper in Manhattan’s Financial District. Trump will accept the gold at an event in the lobby of the Trump Tower at 725 Fifth Avenue.
- Usually, Trump gets a certified check for a security deposit when leasing space in one of his office towers. But …Trump will accept gold bullion worth about $200,000 from Michael Haynes, chief executive of precious metals dealer APMEX. The gold payment was APMEX’s idea — Trump’s press office says Trump has been bullish on gold due to his concerns about the value of the U.S. dollar.
- The gold is the security deposit for a 10-year commercial lease of the entire 50th floor at 40 Wall Street. The gold bars are 0.9999 pure and weigh 32.15 troy ounces each.
- Trump said in a statement: “It’s a sad day when a large property owner starts accepting gold instead of the dollar. The economy is bad, and Obama’s not protecting the dollar at all….If I do this, other people are going to start doing it, and maybe we’ll see some changes.”
Somewhere Ron Paul is smiling…