Gold is upsetting me greatly.... QE off the scale and gold at 12 month lows. The hoped- for precious metals rally as a safe haven from increasingly worthless fiat currency has not happened... in fact the opposite has. Rumours of interest rate rises in the US will only hit gold even harder when that happens.
I’m losing all faith.....
Wattie...?
You’re being very short sighted.
Firstly you are correct as Fiat is becoming increasingly “worthless” with every single one printed but you have to understand that this is a fake game- govts will never admit they won’t repay all the debt they are creating.
Tomorrow’s problem.
Every govt is using the “stimulus” argument to continue money printing- it’s solved nothing. All the previous economic issue that existed a year ago are still there- massively worse and covids still here- millions more are unemployed and lots of zombie businesses exist......massive debt.
The key is the US.
Inflationary signs are everywhere (far higher than the stated fed targets- look at oils rise) but of course the Fed says there’s no inflation. Yields are rising in response, repo market turmoil, falling stock markets.......huge unemployment, another $2 trillion plus in stimulus due in months....the market doesn’t believe the Fed and is now testing it to see how far it will allow rates to rise.
Central banks are trapped.
They have created a QE monster that they cannot stop.......it all falls apart if they do and they know it.
It’s a Ponzi scheme and they rely on new money.
It’s ridiculous that markets are at all time highs when the world economy has been closed for a year- total nonsense, but it’s because there is no true price discovery anywhere. There hasn’t been any since the GFC!
Secondly, everything (stocks/bonds/ markets) is so deeply manipulated and in a bubble that failing to continue to do so will see a collapse. Bankers are having to use more and more “tools” to retain control, in addition to printing more and more to maintain the illusion.
The US Repo market has problems once again......Sept 2019 anyone?
No Govt anywhere can allow interest rates to rise.
They cannot afford it and all the suckers who have huge individual debt cannot afford it too, people can barely make debt payments now- look at all the mortgage forgiveness.
Expect the Fed to implement yield curve control via EVEN more QE. Operation twist possibly and intervene once again......otherwise markets will collapse massively and that cannot be allowed to happen. It would ruin the “wealth feel good effect”.
Hold your gold, it’s insurance against this madness, it’ll come back and if anything it’s ridiculously cheap at these prices - add to your position.
Golds done well as an inflation hedge historically......we may end up with currency collapse as the US $ is printed into Zimbabwe and we have hyperinflation globally.