Sotheby’s auctioned a 59.60-carat pink diamond for a record staggering $83 million. As for art, an Andy Warhol painting recently sold for a breathtaking $105 million. If you were impressed by that, then you should know the all-time record for the sale of any work of art took place this November at an astonishing $142.4 million. 

While the mainstream media says this is just the super-wealthy pushing their weight around in these markets in order to buy trophies, this is actually a much larger push by the wealthy to get out of fiat paper currencies and into hard assets.  This is very similar to what the Chinese are doing. 

From the highly respected Godfather Richard Russell, 89 years old and still writing every day:

“The Dow crept up higher, moving ever closer to the melt-up that I’ve been predicting.  Yesterday’s Wall Street Journal carried a front-page story about retail buyers coming optimistically into the market again.  I expect the retail entrance to the market to reach flood tide buy-in sometime within the next year.  

Thus I believe we are approaching an historic period where funds travel from institutional hands to the retail public. 

The gold base continues to enlarge, and pessimism toward gold is comparable to that which you see at a bear market bottom.  In the meantime, bullion creeps imperceptibly higher.  China is clearly on a new path which will result in a bulging population and a pull-back on its imports. 

The big picture for the US is “under-inflation” and underemployment.  Neither suggests a taper in QE.  In the meantime, smart money is buying tangibles. This can be seen in towering prices for art at recent auctions.”