The Gene McVay History of Gold

It appears to me that the talking heads on Business TV shows and big Wall Street Traders don’t just advise against owning gold, they also seem to passionately hate gold. Perhaps it is because they can’t manipulate the price of gold as easily as they run the stock market up and down?

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Other humans, on the other hand, have had Gold Fever since the beginning of time. The great Prophet Ezekiel says in 28:4, “By your wisdom and your understanding you have made wealth for yourself, and have gathered gold and silver into your treasuries.”

Egyptians used gold to create funeral masks for their pharaohs. The Incas called it the “Sweat of the sun.” It is used to make medals for the best athletes in the world. It symbolizes wealth and riches. Over the centuries, gold has become important to humans. The heavy metal has cultural and economic meaning for human civilizations around the world.

The materials assembled for the tabernacle are described in detail in Exodus 35-38 and summarized in Exodus 38:21-30. The total quantity of gold collected was approximately one ton; of silver, 3-3/4 tons; and of bronze, 2-1/2 tons. That’s $40 million worth of gold at today’s prices and $2.5 million worth of silver. The golden lampstand in the tabernacle weighed a talent and would today be worth over two million dollars for its gold content alone. Of course, any item from the Temple would be priceless.

When Solomon built the first temple, David had already amassed the materials. These materials included 100,000 talents of gold and 1,000,000 talents of silver. The gold alone comes to over $220 billion. Notice, Solomon did not use Treasury Bonds, Exchange-Traded Funds or paper money in the Temple. The gold was not paper gold but the heavy 24 karat yellow kind. The kind the people of Pompeii carried along with the keys to their homes as they fled the eruption of Mount Vesuvius in 79 AD.

Large quantities of gold and silver was taken in Asia by Alexander the Great: 2,600 talents of gold and 600 talents of silver from Damascus, 50,000 talents of gold and 40,000 talents of uncoined gold and silver from Susa and from Persepolis 120,000 talents of gold.

When Jesus Christ was born in Bethlehem, Wise Men brought Him gifts of gold, frankincense and myrrh

The total amount of gold mined and stockpiled in the entire world up to the present time totals about 88,000 tons. If this gold were collected together its volume would be that of a cube 54 feet on a side. In other words, all the gold in the world could easily fit in two Olympic-sized swimming pools. One trillion dollars in $100 bills would take five such swimming pools. Our national debt would require 90 swimming pools. Add our unfunded obligations and you’ll need almost a thousand swimming pools. If the Dollar is devalued like the currency of many other countries, you will need the Pacific Ocean to hold all the $100 bills needed to pay for our obligations.

After all of that, all the gold will still fit easily into just two swimming pools.

The lure of gold has had a major impact on the course of history in the United States. When gold was found in California in 1848, it triggered a movement called the gold rush. Thousands of settlers moved west hoping to find gold and become rich. In total, 300,000 people came from all over the world to California during the gold rush. Before the gold rush, San Francisco was a tiny town of only 200 people. By the end of the gold rush in 1870, San Francisco’s population had grown to 150,000 people.

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I was recently in Alaska and saw the trails used by Klondikers on their way to the gold fields in the Youkon. The trip was long, arduous, and cold. Klondikers had to walk most of the way, using either pack animals or sleds to carry hundreds of pounds of supplies. The Northwest Mounted Police in Canada required that all Klondikers bring a year’s worth of supplies with them. Even so, starvation and malnutrition were serious problems along the trail. The story of the Klondiker who boiled his boots to drink the broth was widely reported, and may well have been true. Cold was another serious problem along the trail. Winter temperatures in the mountains of northern British Columbia and the Yukon were normally -20 degrees F., and temperatures of -50 degrees F. were not unheard of. Tents were usually the warmest shelter a Klondiker could hope for.

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An even larger problem was the trails themselves. Klondikers had two choices: the Chilkoot Trail or the White Pass Trail. The White Pass Trail originated in Skagway, Alaska. Crooks in Skagway fleeced Klondikers in every way imaginable. One way was a telegraph scam where crooks put up poles and wires, but they weren’t actually connected to anything. Then they took cash from Klondikers eager to wire home. The Chilkoot Trail, on the other hand, wasn’t a better option, although it had fewer outlaws. It was steeper than the White Pass Trail, and few were fully prepared for how difficult it was. Many suffered malnutrition and/or died along the trails. Some Klondikers became sick or died from eating the meat of the dead horses found on the White Pass Trail, and it soon became known as the “Dead Horse Trail”. Men reportedly went insane on the trail. It is possible that this diet (or lack thereof) contributed to the reports of insanity.

With the influx of the 30,000 who did make it over the trails, Dawson temporarily became the largest city north of San Francisco. It was no longer a tent city, but a bonafide city, with more amenities than one might imagine. Dawson had fire hydrants on the streets, and was the first city in western Canada to have electric lights. People also felt safe in Dawson. The Northwest Mounted Police kept order in Canada, and nefarious characters were not allowed entry. The growth of Dawson was largely responsible for the creation of the Yukon Territory as a new Canadian Province on June 13, 1898.

The Klondike Kings quickly became very rich. It is estimated that over one billion dollars worth of gold was found, adjusted to late 20th century standards. Others found their fame and fortune in different manners. Jack London became well-known by writing of his experiences in the Klondike. Fred Trump, grandfather Donald Trump, earned his fortune running the Arctic Restaurant and Hotel in Bennett, British Columbia, along the Chilkoot Trail. Nor were the successful Klondikers limited to men. Like Fred Trump, Belinda Mulroney became wealthy by running a hotel and selling supplies. Many women found their riches running dance halls. Martha Black bought a sawmill and went on to become Canada’s second female Member of Parliament. Even some of those who didn’t travel to the Klondike managed to get rich from the Gold Rush. Over 1,000 miles away, Seattle businesses made over $1 million (not adjusted) selling the needed food and supplies for the trip to the gold fields. Seattle mayor W.D. Wood should have stayed in Seattle and taken advantage of the wealth the Klondikers brought to the city. Instead, he resigned his post as mayor and set off for the Yukon. He was one of the many who turned back.

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Unfortunately for those who did make it as far as the Klondike, few found the hoped-for riches. By the time the masses arrived, all the creeks had been claimed, and the new arrivals found they had to work for the Klondike Kings, rather than for themselves. The pay was not bad, ranging from $1 to $10 per day, but this was not what the Klondikers had made the trip for. Many Klondikers never recouped the cost of the trip, which averaged $1200 (not adjusted). Nevertheless, when gold was discovered at Nome, Alaska in 1899, few of these Klondikers stopped to think about what they had just experienced. At the first sign of gold, much of Dawson up and left for Nome, where most of the gold-seekers once again lost out on finding fame and fortune.

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In July 2001, the price of Gold was $357 an ounce; what will be the price of Gold in 2021? What will a dollar buy in 2021? Will Americans be crawling through the hole in the fence or swimming the Rio Grande to find work in Mexico?

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I don’t know, do you? How about the talking heads who know how to make you rich but since they’re still working, apparently they don’t know how to make themselves rich? The bottom line is simple, do your own due diligence and decide if you want to own magic beans or what.

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