“I’d rather be a year or two early, than a day late.” — Mike Maloney
Max Keiser (The Keiser Report) caught up with Mike Maloney recently. In this video, Maloney explains that gold has been manipulated for so long, it could catapult up in price during a crisis. The current economic expansion is getting very stretched out and is actually the weakest in U.S. history. There’s so much pent up energy gold could gap up.
Interestingly, a copyright issue crops up mid way through the interview. It was an issue I wasn’t aware of and probably most people don’t know about it!
I don’t know. I see the big picture and if we even only go back to pre-Obama gold was at about $800.00 an ounce and Silver was at about $8.00-$10.00 an ounce.
I also have seen inflation everywhere from the grocery stores to the automotive industry. I also know the bimetallic monetary system is savings based and the fiat monetary system is based on having everyone in debt.
But the stock market remains strong due to our industry leaders wanting to keep their profit margins high (rich getting richer and poor getting poorer).
Where am I going with this? I can’t recall.
Oh yes; We have learned that due to inflation, silver cannot be mined below $15.00 an ounce. Most metals are separated from other metals when mining, but do we have an idea of what the lowest gold will go and will go back to the prices that existed say ten years ago?
Ten years is not that long in the grand scheme of things, so I can’t help but wonder if gold truly is a safe haven or if it has not simply been on the rise yet again merely make the poor invest in it so the rich here again profit by manipulating the peasants.
Harry Dent had a bet with Jeff Clarke that gold would drop below $1,000 per oz in or before 2017. He lost that bet.
Gold and silver hit highs in 2011 and then dropped consistently until December 2015. The price trend has been upwards since then (with highs and lows along the way).
There’s an argument that Silver is an undervalued metal since it gets used up in industrial processes, unlike gold where most of what’s been mined still exists above ground. Something like 55% of mined silver is now used in industry. It’s used in every computer, tablet and mobile phone. Phones, in particular, are disposable – people tend to upgrade every 1-2 years. All the silver used in them is lost for good.
What this leads to is an increasing demand for silver while the supply diminishes. The price then starts to rise significantly.
The banks have been repeatedly caught manipulating prices for gold, silver, LIBOR rates, etc. And in the last year or so, every time the price of silver has started to rise substantially, someone dumps a load of silver ETFs on the market to drive the price down again.
That price manipulation strategy will only last for so long. And once the cap on silver’s price is removed, then that expectation is that it will “go to the moon”. The gold/silver ratio is expected to return closer to it’s historical 1:15 ratio, again increasing silver’s price.
Each round of Quantitative Easing adds more currency into the system. But it devalues the existing currency reducing its purchasing power. Owning gold and silver protects against that as well as being a hedge against inflation and hyperinflation.
Yes, the stock market is at all-time highs but one of the reasons for that is that companies are doing a huge amount of share buybacks (buying back their own shares) from investors. This makes trading in these stocks look good, so the stock price goes up. Investors see a company on the rise, so they buy in. And the stock price goes up. The problem is that the company money is going into stock buybacks and not into manufacturing goods. It’s a paper tiger.
Every fiat (paper) currency in history has gone to zero. It’s already happening in Venezuala. Typically, monetary systems last about 40 years. Our current system came into operation in 1971 when Nixon took the dollar off the gold standard. In 5,000+ years of human history, both gold and silver have always had value. It’s what humanity falls back to using when currencies tank.
Owning gold and silver means you have funds held outside of the financial system. If all your money is in banks then access to that money is at the mercy of the banks and government. What if the financial system goes down because of a hack? What if the government decide to introduce Capital Controls for some reason and decide to close banks and ATMs for a period? It happened in Cyprus in 2013.
You could keep a large amount of cash. But what if hyperinflation kicks in (as some are suggesting is coming down the pike)? You could need a wheelbarrow full of money to buy a loaf of bread as happened in Weimar Germany. Here’s a list of 21 countries that saw hyperinflation obliterate the purchasing power of the money people owned. And this is just in the last 25 years.
Many pundits and commentators think that the rich are purposefully keeping the price of gold and silver low in an effort to dissuade people from buying them. They want the populace to regard investing in precious metals with suspicion. It means they get to buy more of those limited resources themselves at knockdown prices.
China, Russia and India are buying huge amounts of gold. China is a major gold mining country. None of what it mines ever leaves the country. But it still buys hundreds of tons each year. The result is that there is now a net migration of gold from the West to the East.
Do those countries know something we don’t?
As “little people” we’re playing in a rigged game. But enough of the people in the gold niche whose opinions I’ve come to trust are saying that the price of gold (and silver) is going to rise significantly over the coming decade, that I tend to trust their reasoning. But I can only speak for myself.
Thanks for taking the time to leave a comment.
Daryl