The Paradox of Thrift
Unfortunately, gold having no intrinsic value, will be one of the first assets that gets liquidated (bread and ammunition being the last). Central Banks globally have monetized $9 trillion in debt in the past four years, with the resulting effect on gold, shown below. Time is running out for the gold advertisers to unload their remaining inventory on a gullible public, because we know for certain that borrowers' incomes are heading in the wrong direction.
Bernankenstein v.s. Reality - Place Your Bets
Bernanke is smart enough to know what happens to global markets if he stops buying assets. However, he is fool enough to think he can indefinitely forestall economic reality. Historically, monetary policy was never used for four years straight to support an economy or markets. It was used for short bursts during recessions to ease the cost of borrowing and then ultimately reversed during expansion. This idea that Central Banks can indefinitely bid up assets while we all stand around like fucking idiots waiting for the economy to return from China, is a delusion of the first order. And what will Bernanke say when time runs out on his historical experiment in attempting to defy reality? What did Greenspan say after the housing bubble burst ? - he denied that 1% interest rates had anything to do with it...Apparently lowering the price of something to incentivize demand - aka. Econ 101 - works for every other asset class, except money.
When Confidence Goes Away, So Will The Money...
The real root of the gold fantasy, is that we live in an infantile society that just implicitly assumes there will always be enough money around to buy the trinkets, iPhones and gold bullion offered for demand. This society has never known any different. The last of the Great Depression survivors are all gone now. The Lost Boys of the Idiocracy even reinvented the history around the Weimar Republic and the great hyperinflation. Contrary to the Lost Boys' interpretation of hyperinflation as the problem - it was the solution, to extreme deflation and crushing debt burdens. The difference between an economy in hyperinflation versus one in extreme deflation is that the former is an economy whose heart is beating too quickly. The latter is an economy whose heart is not beating at all. Both situations are bad, but one is a lot worse. All it takes to fully understand extreme deflation is to visualize the 99% of junk in a shopping mall that no one really needs, and then imagine the type of economy where no one can afford any of it anymore.