Last week Alan Greenspan noted that "Rising prices of precious metals and other commodities are an indication of a very early stage of an endeavor to move away from paper currencies."

In other words, people are buying gold as a hedge against inflation....

...Over the past six months Beijing has made a series of moves to protect itself against a dollar devaluation. In a recent "BRIC Summit" in Russia several months ago, Chinese leaders came out strongly in favor of a new reserve currency to replace the dollar...

As recently as 2002, the private ownership of gold was prohibited in China. You could be jailed if caught with any in your possession. Beginning in 2009, in a stunning about-face, the central government removed all restrictions...

It truly is as simple as can be, because every bank sells gold and silver bullion bars in four different sizes to individuals. (Try to find the same the next time you make the trek down to Wells Fargo.)...

Thus China, which only yesterday was the lowest per-capita consumer of gold in the world, is bidding to become the biggest...

All this suggests a mania in the making, and only in the formative stage. Imagine if hundreds of millions of new consumers climb on that particular bandwagon...