Thursday, November 03, 2016

Jeff Clark:
Why I'm Not Worried About 
Where Gold Is Headed
Jeff Clark highlights the following as reasons for being bullish on gold
1. Quantitative easing (money printing)
2. Government debt (inability to spend within your means)
3. Government deficits (inability to balance a budget)
4. Negative interest rates (bonds that are guaranteed to lose money)
5. Excessive credit (another form of money creation)
"Gold can’t be debased or created out of thin air. Its value is timeless, while currency continually erodes. When the next crisis hits, some of this massive amount of currency will naturally flock to gold." .. the conclusion: "It isn’t just that we’re at high risk of another crisis. It’s how government will respond to that crisis. Unfortunately, when the next crisis hits—whether it’s a mild recession or a full-blown deflation as Mike predicts—politicians and central bankers will react in the only way they know how: spend, borrow, print, and debase. This is what they’ve done for centuries. This is why I don’t worry about where the gold price is headed. The next set of crises will send it higher—and then higher still when central bankers impose their inflationary strategies. We don’t know when it’ll happen nor how high it’ll go, but we know the direction it’s headed. It’s predictable."
LINK HERE to the essay

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