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Portugal Runs Out of Gold as Citizens Forced to Sell in Order to Eat

This story from Bloomberg is one of the most gold bullish items I have read in the last 12 months.  While many pundits like to get on their soapboxes and spout about how gold is in a “bubble” merely due to the fact that it has soared so much and they are bitter they didn’t see it coming, this article demonstrates quite clearly that gold is in the opposite of a bubble.  Let’s take a few quotes from the article:

Paulo Oliveira and his wife sold their wedding rings to pay the rent after he lost his job as a builder last month. They were the couple’s last pieces of jewelry.

“We have no more gold to save us from being kicked out this month,” the 46-year-old said as he stood in the area of downtown Lisbon popular with cash-for-gold stores. “Everyone I know is struggling, even the gold stores are empty because nobody has any more gold left to sell.”

“Business has gone from great to terrible in a matter of months,” Luis Almeida, whose family has owned a gold store near Lisbon’s Rossio Square for more than 40 years, said in an interview. “The sad truth is that most of my clients have already sold all of their gold rings.”

Portugal’s gold exports increased by more than five times to 519.4 million euros last year from 102.1 million euros in 2009, according to data published on the Lisbon-based National Statistics Institute’s website.

Oliveira said he now makes as little as 15 euros a day polishing shoes on a wooden stool in Lisbon’s central Barros Queiroz street, where gold traders complain competition is eating profit.

This all very much reminds me of an article I posted several months ago about how pawn shops in the U.S. were running out of gold.  Seems the U.S. serfs got fleeced a couple months earlier.  Good thing we have EBT cards and disability checks though!

The big macro point here is obvious.  Despite a depression and euro weakness, the Portuguese are not only unable to buy gold as protection, they are being forced to sell what little real wealth they have just to survive.  It is all going straight out the back door to China and others.  This is just a massive transfer of wealth away from Europe and once the metal dries up (which appears to be happening now), the gold price will resume its march toward much higher levels.  I believe this march is beginning now and will be very powerful over the next 3-6 months.

Full article here.

Mike

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Contributed by Michael Krieger of A Lightning War for Liberty.

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