Gold – Uncanceled News https://uncanceled.news News that isn't afraid of being truthful. Tue, 07 Jan 2025 10:18:23 +0000 en-US hourly 1 https://wordpress.org/?v=6.7.1 https://uncanceled.news/wp-content/uploads/2024/09/cropped-U-32x32.png Gold – Uncanceled News https://uncanceled.news 32 32 189684256 Gold Breaks Out With Central Bank Surge and Interest Rate Drops Expected https://uncanceled.news/gold-breaks-out-with-central-bank-surge-and-interest-rate-drops-expected/ https://uncanceled.news/gold-breaks-out-with-central-bank-surge-and-interest-rate-drops-expected/#respond Tue, 07 Jan 2025 10:10:04 +0000 https://uncanceled.news/gold-breaks-out-with-central-bank-surge-and-interest-rate-drops-expected/ Precious metals are seeing gains once again following the post-election dip, just as many economists had expected. Even China, which had been holding back for five months, returned to purchasing massive quantities of gold.

“Falling U.S. interest rates and ongoing solid demand from central banks are supporting the gold price,” USB Analyst Giovanni Staunovo said. “(It) Was definitely good to see again purchases by the Chinese central bank last month, but other central banks have been also buying large quantities.”

USB is not alone in their bullish shift on precious metals. Their Chinese counterparts echoed the sentiment to justify recent purchases.

“The decision to increase gold holdings, particularly following Trump’s recent election victory, reflects the PBOC’s proactive approach to safeguarding economic stability amid evolving global conditions,” OCBC analysts said in a note.

All of this was expected by Jonathan Rose, CEO of Genesis Gold Group, who had prepared his company before the election for the results that he was hoping would happen.

“While other gold companies were cheering for Democrats to win so they could continue to sell on fear, we positioned our clients to be ready for a Trump victory,” he said. “It’s paying off now and will pay off even more once he’s in office; expect major gains in gold and silver very soon.”

Genesis Gold Group is a faith-driven precious metals firm that specializes in rolling over or transferring retirement accounts into Genesis Gold IRAs backed by physical precious metals.

“With interest rate cuts coming and a return to sound fiscal principles, we expect the economy to perform much like it did during President Trump’s first term when gold prices rose 51%,” he continued.

The ongoing “bubble” caused by geopolitical turmoil and a stock market that has been propped up by inflation have prompted many Americans to consider safeguarding their retirement with physical gold and silver. To learn more about how Genesis Gold Group can help, request their free, definitive Wealth Protection Kit.

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JPMorgan: “Debasement Trade” Into Bitcoin and Gold Is Here to Stay https://uncanceled.news/jpmorgan-debasement-trade-into-bitcoin-and-gold-is-here-to-stay/ https://uncanceled.news/jpmorgan-debasement-trade-into-bitcoin-and-gold-is-here-to-stay/#respond Tue, 07 Jan 2025 09:48:29 +0000 https://uncanceled.news/jpmorgan-debasement-trade-into-bitcoin-and-gold-is-here-to-stay/ (Zero Hedge)—The so-called “debasement trade” into gold and Bitcoin is “here to stay” as investors brace for persistent geopolitical uncertainty, according to a Jan. 3 research note by JPMorgan shared with CoinTelegraph.

Gold and BTC “appear to have become more important components of investors’ portfolios structurally” as they increasingly seek to hedge against geopolitical risk and inflation, the bank said, citing the “record capital inflow into crypto markets in 2024.”

The debasement trade refers to increasing demand for gold and BTC due to factors ranging from “structurally higher geopolitical uncertainty since 2022, to persistent high uncertainty about the longer-term inflation backdrop, to concerns about ‘debt debasement’ due to persistently high government deficits across major economies,” among others, JPMorgan said.

Institutional inflows

Investment managers including Paul Tudor Jones are longing Bitcoin and other commodities on fears that “all roads lead to inflation” in the United States.

US state governments are also adding Bitcoin as “a hedge against fiscal uncertainty,” asset manager VanEck said in December.

In October, JPMorgan cited spiking open interest on BTC futures as another indicator that “funds might see gold and Bitcoin as similar assets.”

In 2024, net open interest on BTC futures rose from approximately $18 billion in January to upward of $55 billion in December, according to data from CoinGlass.

“In addition, the fact that Bitcoin [exchange-traded funds] started seeing inflows again in September after an outflow in August suggests that retail investors might also see gold and Bitcoin in a similar fashion,” JPMorgan said in October.

In November, US Bitcoin ETFs broke $100 billion in net assets for the first time, according to data from Bloomberg Intelligence.

Crypto ETF inflows are among the most important metrics to watch because they are “more likely than other trading activity to be new funds/market participants entering the crypto space,” according to a December report by Citi shared with Cointelegraph.

Surging institutional inflows could cause positive “demand shocks” for Bitcoin, potentially sending BTC’s price soaring in 2025, asset manager Sygnum Bank said in December.

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[ZH: The structural rise of gold in investors’ portfolios is best shown in the chart below, which proxies gold allocation globally via the stock of gold that is held for investment purposes by central banks or private investors holding gold via coins, bars or physical gold ETFs (or similar products) as % of the stock of equities, bonds and cash held by non-bank investors globally.

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Wall Street, Big Banks Betting High on Gold for 2025 https://uncanceled.news/wall-street-big-banks-betting-high-on-gold-for-2025/ https://uncanceled.news/wall-street-big-banks-betting-high-on-gold-for-2025/#respond Thu, 02 Jan 2025 19:28:16 +0000 https://uncanceled.news/wall-street-big-banks-betting-high-on-gold-for-2025/ In 2025, Wall Street analysts are increasingly bullish on gold, predicting that it will once again be a shining star in investment portfolios in 2025. The precious metal, traditionally viewed as a safe haven, is expected to see significant price increases due to several converging factors.

The anticipation of a gold price surge is largely driven by global economic uncertainties, including potential rate cuts by the Federal Reserve, geopolitical tensions, and concerns over inflation resurgence. Analysts from major banks like Bank of America and JPMorgan have recalibrated their forecasts, expecting gold prices to reach new highs, possibly even touching $3,000 per ounce in the coming year. This optimism is based on the belief that lower interest rates will make non-yielding assets like gold more attractive.

Recent trends on Wall Street have shown a shift towards more conservative investments as investors brace for potential economic downturns or policy changes that could affect market stability. Gold’s historical performance during times of economic stress has reinforced its reputation as a go-to asset in turbulent times.

Additionally, posts on X suggest a bullish sentiment among retail investors, with many discussing gold’s potential for significant gains. This online chatter reflects a broader market expectation of gold as a protective measure against inflation and currency devaluation.

“I’m glad they’re coming around,” said Jonathan Rose, CEO of Genesis Gold Group. “We prepared for gold to first slump following President Trump’s historic win, then for gold and silver to rebound nicely in 2025 and beyond.”

Investment strategists are advising a diversified approach, with gold playing a pivotal role. The metal’s allure isn’t just in its tangible value but also in its capacity to hedge against the volatility of other investments. With central banks potentially easing monetary policies, gold’s appeal is expected to grow, offering stability amidst fluctuating stock markets and bond yields.

Genesis Gold Group is uniquely positioned to help their clients protect their wealth or retirement with physical precious metals. They do not use gimmicks like “free” or “bonus” silver offers, opting instead to practice sound investment strategies.

The consensus among Wall Street analysts is clear: gold is poised for a strong performance in 2025. Investors are considering gold not only for its potential price appreciation but also for its role in stabilizing a broader investment portfolio amid an unpredictable economic landscape.

Request a free Wealth Protection Kit today.

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Did the UniParty Swamp Make a 2025 U.S. Default Unavoidable? https://uncanceled.news/did-the-uniparty-swamp-make-a-2025-u-s-default-unavoidable/ https://uncanceled.news/did-the-uniparty-swamp-make-a-2025-u-s-default-unavoidable/#respond Mon, 30 Dec 2024 17:44:39 +0000 https://uncanceled.news/did-the-uniparty-swamp-make-a-2025-u-s-default-unavoidable/ To say there would be “shockwaves” if the U.S. defaults on its debts next year is like saying there would be great damage if a meteor the size of Madagascar hit the Earth. This nation and world itself is not in any condition to handle the repercussions of such an event and it seems like the UniParty Swamp is in favor of such a catastrophe.

There is hope. Between Republican control of both chambers of Congress and President Donald J. Trump reentering the Oval Office in three weeks, it’s not time to panic. But there needs to be real actions taken to not only raise the debt ceiling but to dramatically cut spending. Unfortunately, the latter may not be in the cards.

The United States is on a collision course with a potential default on its national debt, an event poised to significantly undermine its credit rating and unleash economic turmoil across global markets. This looming crisis is centered around the contentious issue of the debt ceiling, sparking widespread concern among investors, policymakers, and international allies.

The federal debt limit, due to be reinstated on January 1, 2025, sets the stage for a critical financial challenge. With the Treasury Department’s extraordinary measures expected to deplete by mid-2025, there’s an urgent call for Congressional action to either raise or suspend the ceiling to avoid default. Treasury Secretary Janet Yellen has highlighted the gravity of the situation, urging lawmakers to protect the full faith and credit of the United States.

A default would not only question the reliability of U.S. Treasuries, traditionally seen as the bedrock of international finance with zero credit risk, but also lead to a potential sell-off of U.S. securities. Such an event could increase borrowing costs globally and might even push the U.S. into a recession, affecting millions of jobs and household wealth.

This is the path through which de-dollarization can ascend. BRICS nations have diligently been working to usurp the U.S. Dollar with their own currencies. Meanwhile, non-BRICS nations who have relied on the U.S. Dollar are seeking cover. This is why alternative forms of value such as cryptocurrency and precious metals are becoming increasingly popular.

Historically, the U.S. has faced similar scenarios, like in 2011 when political brinkmanship led to a downgrade of the U.S. credit rating by Standard & Poor’s. Although the situation was resolved before reaching default, the mere threat caused economic ripples. The implications of a 2025 default could be far more severe, with Moody’s already signaling a negative outlook on U.S. debt amidst rising deficits and interest rates.

The global economy’s reliance on U.S. economic stability means that any default would have far-reaching effects. Countries with economies tied to the U.S. dollar could see their own financial systems destabilized, and the trust in U.S. financial instruments could wane, leading to a reevaluation of global investment and trade strategies.

In response, some experts advocate for structural reforms to manage U.S. debt more sustainably, while others emphasize the need for immediate, bipartisan action in Congress to avert the crisis. The situation underscores the delicate balance between fiscal policy, political will, and economic stability, highlighting the stakes involved not just for America but for the world’s financial landscape.

To those seeking to protect their life’s savings with physical precious metals, request a 2025 Wealth Protection Kit from Genesis Gold Group.

Article generated from corporate media reports.

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Goldman Sachs: Price of Gold Could Reach $3,000 per Ounce in 2025 https://uncanceled.news/goldman-sachs-price-of-gold-could-reach-3000-per-ounce-in-2025/ https://uncanceled.news/goldman-sachs-price-of-gold-could-reach-3000-per-ounce-in-2025/#respond Wed, 25 Dec 2024 10:11:43 +0000 https://uncanceled.news/goldman-sachs-price-of-gold-could-reach-3000-per-ounce-in-2025/
  • Goldman Sachs predicts China’s massive gold purchases could push the price of an ounce of gold up to $3,000 by the end of 2025.
  • Central banks around the world purchased 64 tons of gold in October, with China officially purchasing the most at around 55 tons – a number believed to be 10 times less than the actual amount.
  • The vast majority of the world’s central banks – 81 percent – are expected to increase their gold holdings in the next year, and no banks anticipate selling their gold reserves.
  • Officially reported Chinese gold reserve holdings increased to 72.96 million troy ounces by the end of November.
  • Gold demand around the world is fueled by a need to diversify assets amid geopolitical tensions and concerns over foreign currency reserves that could be frozen by adversarial nations.
  • (Natural News)—The price of an ounce of gold could reach $3,000 by the end of 2025, driven by the People’s Bank of China’s massive gold purchases and global monetary easing.

    This is according to a prediction made by Goldman Sachs precious metals analyst Lina Thomas, who supported her prediction with recent data showing a surge in gold buying not just by the PBOC but by other central banks. (Related: Gold and silver hit record highs amid geopolitical tensions and Fed rate cuts.)

    Central banks purchased 64 tons of gold in October, significantly higher than the average of 17 tons before 2022. China emerged as the largest buyer, purchasing 55 tons, despite reporting only five tons to the public. This suggests that China’s actual gold purchases are ten times higher than officially acknowledged.

    Goldman Sachs notes that 81 percent of central banks surveyed by the World Gold Council expect global central bank gold holdings to rise in the next 12 months, with none expecting a decline.

    China resumes gold purchases after short pause

    The PBOC resumed its massive streak of gold purchases in November following a short hiatus. Official data from the PBOC showed that gold holdings increased to 72.96 million fine troy ounces at the end of November, up from 72.80 million troy ounces a month earlier.

    The PBOC is the world’s largest official sector buyer of gold – a title the communist bank has held since 2023. The gold purchases are expected to support demand for precious metals by Chinese investors.

    However, the value of China’s gold reserves fell to $193.43 billion at the end of November from $199.06 billion at the end of October, reflecting a decline in gold prices during the month.

    Gold prices dropped in November for the first time since June, driven by a short wave of sell-offs following President-elect Donald Trump’s victory in the November election.

    Spot prices for gold are down five percent since hitting a record high of $2,790.15 an ounce on Oct. 31 but remain up 28 percent for the year.

    Gold purchases driven by demand for asset diversification amid growing geopolitical tensions

    The surge in central bank gold purchases, particularly by China, is driven by a combination of financial and geopolitical factors. Goldman Sachs highlights that since the global financial crisis, many emerging market central banks have sought to diversify their reserves, viewing gold as a financial hedge. Geopolitical sanctions, particularly the freezing of central bank assets, have also played a crucial role.

    The freezing of Russian central bank assets in 2022 marked a turning point, prompting many emerging market central banks to rethink what is considered risk-free. Following the freeze, purchases by central banks and other institutions in the London over-the-counter market surged fivefold. In China, prominent economists have emphasized the necessity of diversifying foreign exchange reserves to mitigate potential U.S. sanctions.

    More related stories:

    Sources include:

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    Peter Schiff: World’s Central Banks Are Starting Inflation Again https://uncanceled.news/peter-schiff-worlds-central-banks-are-starting-inflation-again/ https://uncanceled.news/peter-schiff-worlds-central-banks-are-starting-inflation-again/#respond Thu, 19 Dec 2024 19:57:14 +0000 https://uncanceled.news/peter-schiff-worlds-central-banks-are-starting-inflation-again/ Editor’s Note: Peter Schiff is an excellent resource for all things gold and silver. His knowledge is elite level and his insights are provocative. We would only add that the Trump administration is well prepared to bring better money policies to the United States and that should be taken into consideration. With that said, here’s Peter…


    (Schiff Gold)—On the latest episode of the Peter Schiff Show, Peter dives into a week of new inflation data. He calls out the shaky foundations of the so-called “strong” economy, criticizes foreign central bank policy, and explains how inflation masks the benefits of economic growth.

    To start, Peter reports alarming deficit numbers for the 2025 fiscal year:

    During the first two fiscal months of 2025, because we’re already in that fiscal year, the budget deficit in those two months alone was six hundred and twenty four billion dollars. That’s a 65% increase over the same two months a year ago. In fact, the first time that the United States government ran a six hundred and twenty four billion dollar deficit for an entire year, not just for two months, but for an entire year, was 2009, right after the 2008 financial crisis.

    These figures clash with the official narrative that the economy is doing well. If that’s really the case, why do the American people disagree?

    If consumers were in the greatest shape ever, according to this Wall Street analyst, they would have voted for Kamala. They wouldn’t have tried to get rid of her because things are supposedly so awful, and they’re hoping that Trump would change things. … It’s like you’re lying in a hospital bed, plugged into all kinds of artificial life support, tubes in your mouth, tubes in your nose, blood going intravenously into your body, and you ask the doctor, ‘What’s going on?’ ‘You’re in great shape, absolutely perfectly healthy, except if we unplug anything you’re going to drop dead.’

    hotter-than-expected inflation report released on Thursday practically demands rate hikes from the Fed, but the market still predicts the Fed will cut rates at its December meeting:

    All these numbers confirm is that inflation is bottoming out and is headed much higher, and it never got anywhere near 2%. Especially if you look at the PPI (Producer Price Index), which is a leading indicator for the CPI, because generally businesses have their prices go up first and then they pass it on to the consumer second. … The expectation for the increase in November producer prices was 0.3%, and we got 0.4%. That was double the increase from the prior month of 0.2%, so we’re heading in the wrong direction fast.

    Current predictions place the likelihood of the Fed cutting rates again at over 95%. This is sadly aligned with the inflationary monetary policy being implemented in Europe and the rest of the world:

    Yet the Fed is going to cut rates by another 25 basis points. By the way, the ECB (European Central Bank) cut rates 25 basis points this week, and the Swiss National Bank went for a super-sized 50 basis point cut… Inflation is going to rear its head in a big way all over the world: the Eurozone, Japan, all these countries that are cutting rates should not be cutting rates. Inflation is going to roar back stronger than ever, worse than what we had in 2001, 2002.

    Central banks hoodwink their citizens with inflation, obscuring economic progress for the sake of their own policy goals:

    Let’s assume that all else being equal the government doesn’t create any inflation and productivity is so good that prices would have fallen by 5. Well, that’s great. That’s a huge economic benefit for the economy. …  Now the government creates inflation and instead of prices going down by 5 percent they go up by 2 percent. Now you’re going to say oh well, there’s no inflation now because now we’re at the fed’s 2 target. No! Prices are 7% higher than they otherwise would have been. We didn’t get all that inflation for free. The government robbed us of that increase in our standard of living. They took away the benefit of those price cuts.

    For more analysis of last week’s economic numbers, check out Joel’s analysis on the SchiffGold Gold Wrap Podcast.

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    Invest in “The Dip”: Gold and Silver Prices Appear Stable as Stock Market Crashes https://uncanceled.news/invest-in-the-dip-gold-and-silver-prices-appear-stable-as-stock-market-crashes/ https://uncanceled.news/invest-in-the-dip-gold-and-silver-prices-appear-stable-as-stock-market-crashes/#respond Thu, 19 Dec 2024 08:20:48 +0000 https://uncanceled.news/invest-in-the-dip-gold-and-silver-prices-appear-stable-as-stock-market-crashes/ Investors who were heading for the hills and predicting precious metals prices would plummet to pre-pandemic levels are starting to walk back their dire predictions. Gold and silver prices have stabilized following the post-election dip and now appear poised to resume their climb.

    Meanwhile, the stock market experienced a 10-day losing streak in December, capped by Wednesday’s 1,100+ point crash.

    The central bank reduced its overnight borrowing rate by a quarter point to a target range of 4.25% to 4.5%, as expected. However, the Fed indicated Wednesday afternoon it would only cut rates twice in 2025, fewer than the four cuts given in its last forecast. Fed Chair Jerome Powell said the central bank’s move to cut rates in recent months allows it to “be more cautious as we consider more adjustments to our policy rate.”

    Gold has spent all of December above $2,500 per ounce despite some bears saying it could drop below $2,000 before Christmas. Silver has been even stronger, staying at or near the $30 mark since September.

    “This is exactly what we hoped to see for our clients,” said Jonathan Rose, CEO of Genesis Gold Group. “We anticipated three things: a Trump victory, a quick dip, then a return to a state of stability after the rate cut that makes precious metals the ideal hedge, especially for retirement accounts.”

    Analysts see the coming trade wars, particularly with China, as driving forces behind de-dollarization. BMO expects China to continue to be a player in the gold market in response to President Trump’s tariffs.

    “We do not see global financial systems as being fully prepared for this, and hence gold is once more being pulled back into the monetary system,” the analysts said.

    It could prove prudent to consider physical precious metals to back retirement accounts such as IRAs or 401(K)s. Genesis Gold Group specializes in these. Their free Wealth Protection Kit details how a tax-free rollover or transfer into a Genesis Gold IRA is becoming more popular since the election.

    UBS also expects the demand for gold in investor portfolios to rise next year.

    “While US President-elect Donald Trump’s policy agenda has been well broadcasted, uncertainty remains on what will be implemented from fiscal, trade, and geopolitical standpoints, especially given his transactional approach,” they said. “With the Russia-Ukraine war still ongoing, and the situation in the Middle East no less complicated, we think investor demand for hedges should rise further, boosting inflows to gold exchange-traded funds.”

    And lower interest rates from central banks also support the case for holding gold in 2025, especially after the mid-December cut of 25 basis points.

    “This should reduce the opportunity cost of holding the metal, which is non-interest-bearing,” they wrote. “A weaker US dollar in the medium term, due to lower rates and concerns over the US government debt trajectory, should also support gold prices. Since gold is denominated in US dollars, a weakening of the US currency makes the metal cheaper for non-dollar investors, bolstering demand.”

    These factors have led UBS to maintain their bullish outlook for gold prices over the next 12 months, with the Swiss banking giant now forecasting the yellow metal to reach $2,900 per ounce by the end of 2025.

    Take advantage of the current “dip” in prices by rolling over or transferring your retirement accounts today. Learn more from Genesis Gold Group.

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    Gold-Backed or Bust: Judy Shelton’s Plan to Tame the Fed and Restore the Dollar https://uncanceled.news/gold-backed-or-bust-judy-sheltons-plan-to-tame-the-fed-and-restore-the-dollar/ https://uncanceled.news/gold-backed-or-bust-judy-sheltons-plan-to-tame-the-fed-and-restore-the-dollar/#respond Tue, 03 Dec 2024 11:37:58 +0000 https://uncanceled.news/gold-backed-or-bust-judy-sheltons-plan-to-tame-the-fed-and-restore-the-dollar/ (AIER)—Judy Shelton has spent her career advocating for sound money. Her latest book, “Good as Gold: How to Unleash the Power of Sound Money,” makes an up-to-date case for reinstituting a gold standard. Her intriguing conclusion is that the dollar can be reconnected to gold by simply issuing federal treasury bonds with gold-redeemability clauses. The book also addresses recent events and important current debates about monetary systems like whether central bankers should have wide policy discretion, whether fixed or floating exchange rates are better for economic growth, and what happens when countries manipulate their currency to boost exports.

    Dr. Shelton engages these questions in the context of academic debates, but she also uses the lens of rational economic planning to evaluate how the monetary system contributes to or detracts from economic growth. At the end of the day, the case for sound money rests on the claim that it will generate more stable and greater long-run economic prosperity. Dr. Shelton believes sound money will do just that. But what would such a sound money regime look like?

    Although Dr. Shelton would prefer a system along the lines of a classical gold standard, she would probably be content with other monetary systems that dramatically reduced the discretion of policymakers. The real problem with our current monetary regime is not primarily technical. It is behavioral. Because public officials have strong incentives to inflate the currency, bail out various corporations, and underwrite extensive government borrowing, they do a poor job conserving the value of fiat currency or providing a predictable stable system of interest rates, credit, liquidity, etc.

    In the first couple chapters of “Good as Gold,” Dr. Shelton takes the Federal Reserve to task. The wide discretion Fed officials can exercise makes monetary policy unpredictable. Although Fed officials argue that their decisions are countercyclical, that may not always be the case. As Milton Friedman famously noted, the effects of monetary policy decisions have “long and variable” lags. Despite claims to being “data-driven,” Federal Open Market Committee (FOMC) decisions remain unpredictable. Data can change rapidly and unpredictably, which can make policy change rapid and unpredictable too.

    Another problem is that the “data-driven” mantra invokes the assumption that the data always clearly indicate what ought to be done. In fact, this is rarely the case. Not only do a wide variety of inflation measures exist, but there are also a wide range of time intervals over which to compare inflation trends. But that’s not the worst of it!

    Employment, unemployment, GDP, and a host of other economic numbers suggest different things are going on in the economy. Retailers expect strong record spending this holiday season while the N.Y. Fed just released a study where the number of people reporting concern about their ability to make debt payments hit its highest level since 2020. How to weigh these various factors is far from clear.

    Another problem with Fed policy is the rapid change in its interest rate targets. Three years ago, the short-run interest rate was ~.5 percent. Within two years it was over 5 percent. That rapid change created many issues in the economy, only some of which we have recognized. The rate-hike cycle created significant turmoil in the banking industry with Silicon Valley Bank and Signature Bank failing entirely while many large regional banks shrank or were enfolded into larger national banks.

    The commercial real estate market has also been upended. While the owners of office buildings were already facing strong headwinds from the pandemic’s normalization of remote work, the Fed delivered a one-two punch when it raised interest rates. Most large commercial real estate investors use variable rate debt to finance their portfolios—which means the interest rate they pay moves with the market. Adding a couple percentage points to one’s debt rapidly changes the viability of a venture. In addition to higher debt-servicing costs, commercial real estate investors saw the market value of their holdings decline precipitously as buyers disappeared, financing costs rose, and future potential cash flows were more heavily discounted.

    The previous rate-hike cycle in 2006 and 2007 preceded a major recession and financial crisis. Even as the Fed creates disruptions in markets, it has also overseen the relentless decline in the value of the dollar—ironically in the name of pursuing their mandate to maintain price stability. A dollar in 2024 is worth what a quarter was in 1980 and what a dime was in 1965. And a 2024 dollar is worth about what a penny was worth in 1900.

    This downward march in the value of the dollar creates problems.

    It drives up asset prices, favoring those who have investment savvy while eating away at the value of people’s savings and undermining the prosperity of those on fixed incomes. The steady fall of the dollar also distorts price calculations and expectations.

    I’ve argued elsewhere that the Fed has been a prime culprit in boosting housing prices and, as a result, creating a “transitional gains trap” where homeowners with significant equity, juiced in large part by easy money, have organized to protect their equity by putting up local legal barriers to building new housing.

    But “Good as Gold” includes much more than criticism of the Fed. Dr. Shelton points out that unstable money and exchange rates create costs to doing business. International firms must devote time, energy, and money to protect themselves from erratic fluctuations in currency exchange rates. Creating these “hedges” to protect their profitability from exchange-rate risk necessitates additional classes of assets and asset traders—contributing to greater “financialization” of the economy. While the services being offered create real value for corporations, they come at a price and would not be needed under more stable monetary arrangements.

    Besides the frictions and costs that unstable money introduces into day-to-day business operations, it also creates long-term consequences when it comes to investing. If certain exchange rates can move 15 percent, 30 percent, or more in a single year, Dr. Shelton asks, then how can investors rationally allocate capital based on real factors and comparative advantage? The structure and mix of capital investment we currently have across countries and within the same country looks very different than it would in a world of stable money.

    Dr. Shelton makes this point indirectly in a fascinating chapter about the monetary debate between Milton Friedman and Robert Mundell. Both were staunch advocates of free markets, but they differed in what monetary regime they thought best. Friedman argued in favor of freely floating exchange rates set by market participants. In this world, governments would feel pressure from markets, in the form of capital outflows, if they engaged in domestic monetary policy shenanigans. Mundell, on the other hand, favored more stability in exchange rates that would require domestic prices to adapt to changes in trade and capital flows. Friedman and Mundell both agreed, however, that government officials and central bankers should have very little discretion in how they managed a country’s monetary system.

    In a later chapter, Shelton offers the problem of “currency manipulation” as a reason for implementing a sound money regime. Her argument basically asserts that countries that actively depreciate or weaken their domestic currency experience short-run benefits (in the form of more competitive exports) and long-term costs (in the form of inflation and capital outflows). Other countries, however, feel short-run pain as their exports decline and their factories shut down—even though they also receive cheaper goods and reallocate much of the displaced labor and capital. I find this line of reasoning a bit curious.

    Shelton rightly champions free trade and argues that it works best when countries do not artificially manipulate the value of their currencies. No objection here. But I am not convinced that a sound money regime, even a gold standard, would change other countries’ incentives to devalue their currency. Gold convertibility of one currency does not prevent the issuer of a different fiat currency from issuing large amounts of that fiat currency to reduce the relative price of its exports.

    I suppose one could argue (and Dr. Shelton does) that currency manipulation becomes easier to discern because currencies will be valued in terms of a fixed standard (gold), rather than in terms of another fluctuating fiat currency. For example, the price of gold in terms of dollars increased by 77 percent from May 2014 to May 2024.

    The currencies of the largest trade partners with the United States lost far more value relative to gold in that periodEuros (129 percent), Mexican Peso (131 percent), Canadian dollar (122 percent), Chinese yuan (105 percent), and Japanese yen (165 percent). But that probably matters relatively little to the devaluing regime. Using gold as a benchmark might reveal relative changes in the value of currencies better. It could also defuse the language of “currency manipulation.”

    Instead of attributing motives to foreign central bankers, policy makers could set relatively straight-forward criteria for when another country’s currency declines in a distortive way. Shelton suggests that some level of tariffs should be imposed in response to another country’s currency devaluation to offset the monetary distortion to international trade. This idea may not be crazy from a purely technical standpoint, yet I would hesitate to recommend it because of the likely distortions and co-opting of such policies by special interests. I also question whether the costs of not imposing tariffs on depreciating currencies is as high as Dr. Shelton believes.

    Sound money advocates like Shelton must explain how we could get to a sound money regime. On the one hand, advocating a gold standard seems archaic and implausible. On the other hand, it would not be technically difficult to implement. And, in fact, given the dominance of the U.S. dollar, if another major currency, such as the Euro, also chose to move back to gold redeemability, it is not hard to imagine other major currencies (Yen, Yuan, Pound, etc.) following suit. The political difficulty, of course, is getting the United States to take the first step and then getting the EU to follow suit.

    The odds of successful reform are highest when pursuing the easiest path to transition the current system to a sound monetary regime. Abolishing the Federal Reserve is not on that path. So tying dollars back to gold using the Fed makes more sense than moving back to a pre-Fed world. Similarly, constraining the FOMC seems far more plausible than abolishing it.

    It may be worth raising a few other important secondary questions. At what price will the currency be convertible into gold? Dr. Shelton has suggested that incorporating a gold clause in Treasury bonds could be a good method for discovering the right price of convertibility. In fact, putting gold convertibility into government bond contracts may be sufficient, in and of itself, to tie dollars back to gold.

    Afterall, depreciation of dollars would create consequences for the federal government and the Federal Reserve, the very institutions primarily responsible for managing the dollar and maintaining the monetary system. Shelton also makes the important point that currency should be seen as being like a weight or measure—something standardized for the public to use. It should not be viewed as a policy instrument or lever for managing the economy. This simple point rarely arises in modern commentary on the Fed and on monetary policy—yet it has deep legal and historical roots in the American founding and beyond.

    Another benefit of moving to gold redeemability for U.S. bonds is that it utilizes U.S. gold reserves more effectively. Currently, the United States is the largest holder of gold in the world. But ironically, that gold is severely undervalued on the government’s ledger. Its book value is less than two percent of its market value (i.e., on the ledger the gold is valued at less than $50/oz when its market value is over $2700/oz). Offering gold redeemability might also open up the option for extremely long-dated debt (50 years or more) and lower interest rates because the most significant risk to lending to the federal government, the devaluation of future dollars, has been taken off the table.

    The likely benefits of such bonds are so significant that it may seem surprising that they have not been implemented. The problem, of course, is that this form of bond would reveal the man behind the curtain. It would show that government officials can and do play fast and loose with the dollar and with the U.S. financial system to enable themselves and their friends a free hand to borrow and spend, and to actively “manage” the economy.

    Dr. Shelton’s proposed changes will be vigorously resisted by those who benefit from the existing status quo—large commercial banks and financial institutions, Federal Reserve officials and bureaucrats, politicians and regulators—everyone who benefits from the Fed’s tendency to loose monetary policy. Still advocates of freedom and prosperity should continue to make the arguments and offer proposals for moving to a sound monetary regime.

    And that is exactly what Dr. Shelton does in “Good as Gold.”

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    Goldman Sachs the Latest to Predict Gold Prices Breaking $3,000 in 2025 https://uncanceled.news/goldman-sachs-the-latest-to-predict-gold-prices-breaking-3000-in-2025/ https://uncanceled.news/goldman-sachs-the-latest-to-predict-gold-prices-breaking-3000-in-2025/#respond Mon, 02 Dec 2024 13:23:26 +0000 https://uncanceled.news/goldman-sachs-the-latest-to-predict-gold-prices-breaking-3000-in-2025/ The election of Donald Trump combined with geopolitical turmoil and anticipated interest rate cuts have gold and silver bulls salivating over the current lower prices. They’re saying now is the time to buy before the next big surge, which some believe could start before Christmas.

    Analysts at Goldman Sachs joined the chorus of experts expressing their belief that Gold could hit $3,000 per ounce sooner rather than later.

    Goldman Sachs analysts predict that gold prices will reach new heights in 2025 due to increasing central bank demand and anticipated US interest rate reductions. Daan Struyven and other analysts have set a target of $3,000 per ounce by December 2025. The surge in gold prices is expected to be propelled by central-bank purchases and US interest rate cuts, supported by a potential boost from exchange-traded funds (ETFs) as the Federal Reserve implements policy easing.

    In a recent note, Goldman analysts highlight the ongoing support from central banks, particularly those with substantial US Treasury reserves, as they diversify their holdings to include gold.

    “It’s interesting that Central Banks have responded the way they have,” said Jonathan Rose, CEO of Genesis Gold Group. “They’re generally more reserved but the current prices have them buying, which is a good sign for our clients based on the proper mix of metals we have for them.”

    According to Bloomberg:

    Bullion jumped as much as 2% in intraday trading, surpassing $2,600 an ounce, on Monday after taking a battering in the wake of Donald Trump’s US presidential election victory, which spurred a dollar rally that weighed on commodities.

    The bank listed a wager on bullion among its top commodity picks for 2025, citing Federal Reserve rate cuts that reduce the opportunity costs of holding gold; tariffs that underline its role as an inflation hedge; and steady demand from central banks.

    “We put together a Wealth Protection Kit for Americans who want to protect their retirement with physical precious metals,” Rose said. “This week we’re expective a big surge with the prices at their most competitive in months.”

    The prospects of President Trump using tariffs for both revenue and as a bargaining tool has Central Banks betting heavily on gold and silver. Even if tariffs aren’t immediate, the threat of them is already being put on the table by Trump over a month before his inauguration.

    Once they hit, prices on gold and silver could skyrocket.

    Learn more about protecting wealth or retirement with physical precious metals by requesting the free, definitive Wealth Protection Kit.

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    Poland Reads the Signs, Doubles Down on Gold https://uncanceled.news/poland-reads-the-tea-leaves-doubles-down-on-gold/ https://uncanceled.news/poland-reads-the-tea-leaves-doubles-down-on-gold/#respond Sun, 17 Nov 2024 13:28:28 +0000 https://uncanceled.news/poland-reads-the-tea-leaves-doubles-down-on-gold/ Poland has decisively established itself as a formidable player in the global arena of gold reserves, notably surpassing Great Britain by amassing over 400 tons of this precious metal. This significant milestone not only illustrates Poland’s growing commitment to financial security but also emphasizes its resilience in economic matters.

    According to Adam Glapiński, the esteemed governor of the National Bank of Poland (NBP), the central bank currently holds an impressive total of 420 tons of gold, thereby officially securing Poland’s position among nations with some of the largest gold reserves worldwide.

    “Poland has entered the club of the world’s largest gold reserve holders,” Glapiński announced, emphasizing that this achievement surpasses that which is held by the United Kingdom.

    Strategic Goals for Poland’s Gold Reserves

    The governor confirmed that one primary objective for NBP is to elevate gold holdings to comprise 20% of its total foreign exchange reserves.

    “This move will align us with the world’s leading economies,” Glapiński noted. At present, approximately 15% of Poland’s reserve assets are constituted by gold—a reflection that signifies substantial progress toward achieving this ambitious target.

    In recent months, specifically over a period spanning five months, Poland has expeditiously intensified its efforts in acquiring additional quantities of gold—adding an impressive 39 tons—to bolster its already considerable reserves. Such strategic buildup serves as a testament to Poland’s proactive stance against potential global financial disruptions.

    The Case for Gold: A Financial Shield

    Glapiński has been an unwavering advocate for utilizing gold as a safeguard against financial crises and market volatility. He reiterated its unique qualities when he stated,

    “Gold retains its value even in the event of a systemic collapse in the global financial network, where digital assets may fail.”

    He further emphasized that this enduring asset remains impervious to credit risks and devaluation wrought by monetary policies—making it not merely valuable but remarkably durable as well.

    Furthermore, it is crucial to recognize that Poland’s renewed focus on accumulating wealth through golden assets is deeply entrenched within historical contexts and national experiences; memories etched into collective consciousness regarding German occupation during World War II and subsequent Soviet-era dominance remind citizens alike about both tangible security measures and their undeniable importance amidst turbulent times ahead.

    Cultural Significance and Economic Resilience

    This profound sentiment resonates deeply within many Polish hearts; Marta Bassani-Prusik—the head expert overseeing precious metals trade at Mint Polska—highlighted such cultural significance succinctly:

    “For many families, gold has been a lifeline through turbulent times, a tradition passed down for survival and security.”

    By placing paramount importance upon acquiring more extensive stocks related directly back towards physical manifestations like golden bullion bars or coins themselves rather than relying solely upon fluctuating currencies alone ensures ultimately greater preparedness while simultaneously conveying determination towards enhancing national economic resilience moving forward into uncertain future landscapes ahead filled with challenges yet unseen across our globe today!

    Undoubtedly then—we see here indeed how these achievements undeniably underscore wider commitments made toward attaining newfound autonomy concerning fiscal independence alongside ambitions directed solely aimed at long-term stability.

    Article generated from corporate media reports.

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