It was the steepest two-day decline in gold prices in 33 years, a 13 percent fall in two days of trading. After years of surging value, of investors hedging against inflation, there was a sudden sell-off that might have been a reaction to... well, to inflation not actually increasing. Over at Business Insider, Walter Hickey looked at Ron Paul's portfolio and estimated that America's best-known gold bug was "personally losing a fortune."
On Wednesday I joined the Paul movement for the launch of the Ron Paul Institute for Peace and Prosperity, at the Republicans' Capitol Hill Club, right near the House offices formerly used by the congressman's staff. I asked Paul: What was behind the gold tumble? Was he worried?
"That's a market phenomenon," said Paul. "That's not unusual. It reminded me of shortly after gold was legalized, in 1975, summer of 1976, gold went from $35 up to $200! Now, $200 was really radical. From there it lost 50 percent. Markets are like that. They're erratic. But I don't see the price of gold as the issue as much as the value of the dollar. The value of the dollar is a subjective thing, it comes and goes, and there're a thousand different reasons why the values go up and down. There's nothing unusual about that market."