Damned if they do, damned if they don’t, politicians the world over are looking pretty sheepish right now. Nationalizing failed banks, mortgage lenders and insurance firms hardly makes for a strong election pitch. It won’t do much to coax fresh risk capital into shoring up financial balance-sheets, either. But letting them fail would only look worse…

The second part of Adrian Ash’s series on the rise and fall of the dollar looks at how an “obsessed” US Treasury hoarded almost all of the world’s monetary gold stock in the first half of the 20th century. In the process, the government nationalized the shiny metal and monopolized control over money. With its overactive printing presses, it still exercises this total control over today’s fiat currency…

The battle between the two ‘flations - inflation and deflation - is far from over says Adrian Ash in The Bullion Vault. Private investors fearing collateral damage might want to take cover. Gold bought near $800 an ounce might just provide some kind or armor…

Since the days of Alan Greenspan, the Fed has been so petrified of a slowdown it has practically killed the value and stability of the dollar, says Adrian Ash in Whiskey and Gunpowder.

But by keeping interest rates below the rate of inflation for three straight years starting in 2002, the Fed created a bubble in the housing market. That bubble has now popped, leaving in its wake a severe liquidity crisis.

Now big banks won’t lend without the backing of government bonds, and the Fed continues to inflate money supply. All good news for gold, says Adrian…

It’s hard to over-egg the importance of Indian jewelry demand in the physical gold market. Between 2000 and 2007, gold jewelry sold in India accounted for one ounce-in-nine sold worldwide. One ounce in every five wound up as an Indian import (its domestic mines produce less than six tons per year), ready to be hung off young brides as 24-carat dowries or worked into bracelets and necklaces for the international market.