Plummeting Gold Prices Won't Stop Sean Hannity and Glenn Beck's Sponsors from Trying To Sell You More

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For years, right-wing radio hosts Glenn Beck and Sean Hannity have been telling people to buy gold. Never mind that the dealer they pushed their flocks to was ripping off coin buyers so badly that a court ordered it to pay millions in restitution. Gold prices fell 13 percent two weeks ago. They’ve fallen 20 percent since August 2011.

Are people who bought gold dupes? Were they fooled by conservative blabbermouths, unscrupulous dealers and market speculators led by hedge fund manager John Paulson? Did they think gold would never fall, like people who bought into the recent real estate bubble? What are we to make of this market zigzag, fueled by people who love to hate the Federal Reserve, expect global inflation and fear for their economic security?

There was only one way to find out. Instead of jumping to the easy conclusion that this is just another market bubble imploding before our eyes at the speed of panicked trading, I picked up the phone and called Goldline, the company touted by the right-wingers and slapped by the courts, to see what they were telling anxious investors.

I was patched through to a very articlulate salesman, two days after the price collapse on April 12 and 15. I asked, "What are you telling people?" And, as salesmen are trained to do, he said, "No worries, just buy more!"

“I do look at at this as a buying opportunity because of the simple fact that nothing has really changed economically,” he said. “What’s been pushing gold and silver higher for the last 11, 12 years has only picked up pace. There’s only more money printing going on: $85 billion a month since December. And they’re not ratcheting that down. The Fed continues to come out and said they’re going to come out with the same money-printing programs, keeping interest rates from 0 to .025 percent, saying now through 2015… So every indication is we are expecting numbers to go higher.”

In every market bubble, people who are ahead of the curve make lots of money—whether tulip mania in Holland in the 1670s or Internet stocks in the 1990s or real estate in the 2000s. Most people make money on investments when they buy low, which includes a certain amount of luck. I wasn’t persuaded by Goldline’s answer, which seemed to ignore the gold bubble bursting with a dash of right-wingisms: bash the Fed, fear of inflation, etc. So I asked the salesman: Is it really a buying opportunity?

“We’ve seen a very interesting recent article from John Hathaway. He has a very good reputation in this industry with what he expects gold and silver to do,” the salesman said without missing a beat. “He came out and said that in his opinion, gold prices have been subjected to a cleverly orchestrated, what he called a bear raid, on Friday and then again on Monday. We did see a selling of Comex contracts, gold contracts for paper gold, not actual physical selling. It exceeded global annual production by 12 percent. One whole year of gold mining and 12 percent right after that. He did go on to say that the volume was without precedent and had all the characteristics of a panic liquidation by naked short-selling.”

Wow. Isn’t it wonderful when one of gold’s biggest boosters— Mr. Hathaway—is the one to point the conspiracy and panic-attack finger at big-time speculators, instead of liberal economic commentators like NakedCapitalism.com? But that’s an aside. Of course, the industry’s chosen expert is a cheerleader, beating the "buy now" drum.