Glenn Beck to Fox News: These aren't the droids you're looking for...
December 14, 2009 4:38 pm ET by Brian Frederick
For those who haven't followed the controversy surrounding Glenn Beck's promoting of Goldline while suggesting on his show that people should buy gold because society might collapse, Jon Stewart summed it up nicely last week:
That's kind of a nice little feedback loop. Glenn Beck is paid by Goldline to drum up interest in gold, which increases in value in times of fear, an emotion reinforced nightly on Fox by Glenn Beck.
The relationship between Goldline, Beck and Fox News would actually make for a great, dare I say it, chalkboard diagram.
As the media began to pick up the story and question the relationship between Goldline and Beck, Fox News clarified the relationship this weekend. A senior executive at Fox News told the New York Times that Fox's legal department contacted "Beck's representatives," who "sent back word that he is not a paid spokesman." But according to the exec, it would be "problematic without question" if he was a paid spokesman.
And to make things even clearer, according to the Times, Fox released a statement outlining its official policy: "Fox News prohibits any on-air talent from endorsing products or serving as product spokesperson."
If you're wondering how what Beck does for Goldline is any different than that, you're not alone.
Goldline sponsors Beck's television program and his radio program, but the relationship doesn't end there. Beck's face appears on Goldline's website, where, until the relationship began to be questioned, he was listed as a "paid spokesman." Not so, said Beck's representatives to Fox News. These aren't the droids you're looking for.
On Friday's radio show, Beck used a preview for his Friday night television show to plug Goldline.
Here's our sponsor this half hour. Our sponsor this half hour is Goldline. Gold is something that I have invested in. I bought when it was about $300/oz and I've never done it for an investment. Don't listen to me for an investment advice. Please. I can tell you directions that I think, but I could be wrong. And have been in the past. Gold is something that I buy as an insurance policy. You don't put all your money into gold or anything like that. Because if the dollar falls apart and please watch tonight's show and I'll show you what's coming. If the dollar does fall apart, what do you have? Now you may not be able ot afford gold and for god's sake don't go and get into debt. I know they offer payment plans. Please don't. Please. Don't rack up any debt. But you have to have something of value as an insurance in case things go haywire. For me and my family that's gold. You decide on your own. Call Goldline and find out all the options. Ask them how I buy gold, why I buy the gold that I buy. I buy the coins. I will tell you that that's a little off the deep end. But I'm off the deep end if I'm going to have an insurance program, I want an insurance program. Find out all about it. Go to goldline.com. Go to 866-Goldline. Full disclosure: Goldline is a sponsor. That's why I'm telling you this is a paid commercial. 1-866-Goldline.
Sure enough, on Friday night's program Beck essentially suggested that people better start buying gold because the country's about to fall apart. Beck first used a stoplight metaphor to explain how our economic system works. Green light means everyone buys stocks, yellow light means T-bills and red light means "Gold, Guns and God." Beck claimed we are at yellow for one of the few times in our history. But there are signs it all might fall apart:
Anybody who has a ton of money and they put their money where their mouth is, they don't feel comfortable where we're going. It is yellow.
And, by the way, you're seeing flashes of red. Gold is massively down in the last week, but it may zoom up again, it may not. But it's a warning sign of flashing red light, which we also rarely, if ever, see.
If that wasn't clear enough, Beck said: "The smart money is saying 'hunker down.'"
The same show, Beck employed another metaphor:
[A]s a country, it's like we've moved to California where it's the land of earthquakes. But we've never had earthquakes before, OK? If you're in Washington or if you're in New York and say to somebody, where is the safest place in your house besides under the table in an earthquake, a lot of people wouldn't know.
It's in the door frame, OK? You stand in the door frame. If you're from the west coast, you know that. Stand in the door frame. Why? It is the threshold. It is the place that is most secure for you.
The country has never had earthquakes, financial earthquakes like this. So, the door frame on this side is the stocks and T-bills.
I talked to this guy, and he said, "Glenn, I'm here. The door frame of insanity, really, is gold, God and guns, because you don't know what's on this side of the door, right? So you're standing here with the treasuries, and you're just hoping you're going to jump back out, but you really don't know. He said, for the first time, he doesn't know which way he's going and he has no idea. Nobody has ever thought about what's on this side of the door frame.
Does that make sense?
Uh, not exactly, but it's pretty clear you want us to consider buying gold.
Over the weekend, Beck posted an online video on his site responding to the controversy, asserting:
I wasn't aware that apparently was the most powerful man on the planet. I didn't know that by me suggesting to you to buy gold through a fine establishment like Goldline.com, 866-Goldline, that the global price of this trillion dollar industry, global industry, would actually start to wildly fluctuate.
Beck's obviously not going to seriously answer these questions. And by refusing to hold him accountable - again - Fox is allowing everyone to see who really runs the show.

















Don't know much about numismatics, myself. I have a pocketful of arcade tokens I've collected since Pac-Man rejected my first quarter back in '82.
It only works on the weak-minded... so everybody at FOX is a prime candidate.
I might have gotten that quote wrong.
</nerd>
Please NO MORE CHALKBOARD DIAGRAMS !!!!!!!!!!!!
He's answering a question nobody is asking.
Its all about conflict of interest and full disclosure.
Either he is a paid spokesman for Goldline like they claim or he isn't.
But I'm off the deep end
Does that qualify him as a kook, also?
Also, one of the few times I have heard him speak any kind of truth.
If you buy gold to hedge the risk of an "economic collapse" you are an idiot. You can buy gold to hedge moderate inflation, but we aren't going to see inflation of any substantial level anyway. The inflation rate is anticipated to be well below the target of 2.5% into 2012/2013 and once a real recovery happens the Fed will simply lower reserve requirements, increase reserves rates and convince banks to hold more reserves and contract the monetary base to maintain the target 2.5% inflation. There's no risk of inflation here.
If you are anticipating a financial collapse the only thing we are looking at is a deflationary spiral. That's the reason the Federal Reserve try's to create inflation expectations in a crisis, to prevent deflation. In a deflationary spiral, Gold as a commodity will lose huge value just as much as any other commodity.
Most people point to the Great Depression to counter this view because gold prices actually rose. The problem is that gold was directly tied to the money supply through a complicated commodity pricing / Treasury mechanism, but suffice to say their values were heavily intertwined. Since prices were deflating, paper money and, thus gold, was appreciating. Hence why banks run happened, money was appreciating and it was a safe asset. Now that gold is not fixed to money by the Treasury, one would expect it would deflate in value just like every other commodity.
So, not only is his argument the financial system going to collapse incoherent; but his argument for investing in gold is equally ridiculous.
Because the door will swing shut in the earthquake. The pain in your fingers will take your mind off the fact your home is falling down around your ears...
For example Goldline pays FOX news to have Glenn “read” their commercial instead of having one air during commercial breaks. Thus Goldline is paying FOX and not Glenn. Make sense?