Ron Paul: Price of gold reflects something wrong with the dollar

Ron Paul was interviewed today on Bloomberg about what he thinks about the recent decline in gold.  When questioned about the fall in gold price he explained that this is how markets work.  There will be short term volatility but as long as the Fed is increasing inflation the long term trend will be up for gold prices.  There has been a bull market for twelve years even though there have been many corrections in the price.

The reporter pointed out that the CPI has shown little inflation but Paul countered by saying that the CPI doesn’t reflect the true rate of inflation, which could be close to 8% by some estimates.  People on fixed incomes are not happy with their purchasing power as they see it declining from the devaluation of the dollar, suggested Dr. Paul.

Dr. Paul was also questioned about Bitcoin and said that although he doesn’t fully understand the cryto-currency, it doesn’t meet the definition of money and he’s not a big supporter of it because it is not something he can put in his pocket.  For something to be money it has to start out as a demanded commodity and be widely accepted as currency.

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