Christopher Ruddy runs to the defense of Glenn Beck and Goldline in his May 26 Newsmax column:
Congressman Anthony Weiner’s inane attacks on Glenn Beck and the gold coin dealer Goldline make me think there is some other agenda at work.
Though Weiner has named Beck and the company he endorses, Goldline, he has also made clear that Goldline is just one of several gold coin companies overcharging customers. He argues that, if investors were able to smelt their gold coins, the actual value of the pure gold metal itself would be far less than the cost of the coins — sometimes as much as half the cost companies like Goldline charge.
Weiner’s view is naïve and ignores the fact that many of these coins have intrinsic value as a collectible, just as an antique would.
Those who own such gold coins — I am one — recognize the value of the coin is not just in the gold. Imagine saying an antique car that sells for $250,000 is really worth about $500 — because that’s the actual value of the metals that make up the car if it were ever junked.
First, that's a misleading attack on Weiner's report. The melt value is only one aspect Weiner examined; his report also pointed out that Goldline's retail prices on coins are as much as 102 percent above those of competitors for the exact same coins.
Second, Ruddy fails to disclose that Goldline is a Newsmax advertiser, most prominent as the sponsor of the commodities ticker on its MoneyNews front page.
Ruddy goes on to mount a larger defense of gold as an investment, despite its status as an "unproductive asset":
Why the worry over gold coins?
Just turn on the TV and listen to the flood of ads selling such coins. Tune in to the radio and hear the same. Upscale malls now have kiosks for individuals to cash in gold. Gold is all the rage — and its price of around $1,200 an ounce is hitting new highs.
Gold has become an enemy of the state.
It is an enemy because it is an ancient store of value. It even can act like a currency. In fact, as currencies lose confidence, as we have seen with the dollar and the euro, investors often buy gold.
But unlike many other investments, gold is an unproductive asset. It sits in your home, in a bank vault, maybe buried in your backyard. Meanwhile, even cash in the bank is not idle, as banks lend against your deposit.
Economic activity is spurred, unlike a stagnant gold investment.
The surge in the price of gold is a bad omen for the U.S. economy. It is also a vote of no confidence in President Obama by the investor class.
Gold purchases undermine the strategy of Obama and the Fed, both of whom are trying to inflate the currency. But, as Milton Friedman so artfully explained, simply printing money does not cause inflation. Inflation is caused when too much money actually goes into circulation and is used in the economy over a period of time. This is called the “velocity” of money.
And, like any good fearmongering gold hawker, Ruddy makes sure to mention that Franklin Roosevelt "confiscated almost all privately owned gold, including gold coins."
Ruddy and Newsmax have a long history of hyping gold to fearmonger people into buying their financial products.