On the Road With Ron Paulby
Robert Wenzel Recently by Robert Wenzel: Fascinating Data on Gold Reserves per Person
Last week Friday, I had the opportunity to spend time with Ron Paul. It was a chance to get a sense of Dr. Paul that went beyond the short sound bites and brief television appearances that is the way we generally get to gauge presidential candidates. I met him in Reno, NV where he was on the campaign trail. I came up from California for the meeting. Because of Dr Paul's tight schedule, Jesse Benton, Paul's communication director, gave me 30 minutes at 7:00 in the morning. Since Paul had given a speech the night before at the University of Nevada-Reno, I wasn't sure how much energy he would have that early in the morning. But at 7:00 when I sat down with Dr. Paul at the Silver Legacy Hotel, he was wide awake and clearly ready for a full day. On television the gentleman that Ron Paul is comes across, but in person there is more. There's a personal warmth and almost a Ronald Reagan-like charm about him. (There's pluses and minuses to Ronald Reagan, the president, but he did have that charm, and so does Dr. Paul) When we sat down to talk, it was almost like we were life long buddies. Without waiting for any questions from me, he told me that the week was the busiest in his life. On Monday, he was in New York promoting his new book. He also appeared on "The View," on the "Sean Hannity Show" and the "Colbert Report." On Tuesday he announced the formation of his exploratory committee and also began handling reporters' questions about Fed Chairman Bernanke's upcoming press conference. On Wednesday, there were more news interviews from reporters wanting to know his view after Bernanke's briefing. Dr. Paul told me that his new house is an hour away from Houston and that he had made the decision not to go into Houston for short news media interviews. He told me somewhat excitedly, as an indication of his growing following, that on Wednesday the television stations sent trucks from Houston out to his house to get his reaction. On Thursday, he landed in Reno, Nevada for the speech at the University of Nevada-Reno. He told me that he was excited to see a crowd of between 600 and 700 in attendance for his speech.
He told me the event was organized by the Young Americans for Liberty, and he seemed very excited about the work they are doing across the country. He also pointed out how well organized the Reno event was, which was coordinated by YAL Southwest Regional Director Adam Weinberg. We then went on to discuss the economy. He told me that he again planned to propose a bill that would specifically call for the auditing of the Treasury holdings of gold at Fort Knox. He also told me that he may propose a bill that calls for the prevention of the Federal Reserve from buying Treasury securities and other assets. This could be his best idea ever. It would, of course, halt the Federal Reserve's ability to print money and, thus, halt the price inflation that is caused by Fed increases in the money supply. It would also prevent the Fed from shoveling money to Goldman Sachs, JPMorgan and the like. We went on to discuss the current state of the dollar, price inflation and so on. I found his understanding of markets remarkably sophisticated. At one point, he said to me, "You know, these markets can all very rapidly just take off and the dollar can collapse and prices climb very rapidly." For emphasis, he moved his hand horizontal and then quickly vertical. In my many years of trading and talking to investors, one of the most difficult concepts to get across is how quickly markets can change and move dramatically. Most people tend to think of investments as trading within ranges or a slow move in one direction or another, not quite realizing that the moves at times can become very spectacular. Ron Paul seemed to understand this possibility very clearly. I've written before that in watching the way Fed Chairman Bernanke deals with the money supply that he does not appear to have a lot of experience trading stocks. He seems to react to market moves at odd times. Ron Paul, on the other hand, seems to have a trader's understanding of the markets, and an in depth understanding of how quickly markets can change. At one point, Dr. Paul speculated with me as to how much Bernanke understood the tight box he is in, with the potential for serious price inflation, on the one hand, and the alternative being very high interest rates to stop the inflation. Dr. Paul said to me, "You know he may believe that it's not as if he can say what he is exactly thinking, since if he really understood the problems, and said so, the markets would react dramatically." As we talked, he told me that interest rates may climb a lot quicker than Bernanke and other Fed members expect, because of the price inflation that is likely. May 3, 2011 ©2011 Economic Policy Journal
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