The annual “In Gold We Trust” report for 2020 is out.
I look forward to this free annual report.
Not only is jam packed with all kinds of charts and graphs, but it discusses economics, markets, and gold from a free market perspective. You can access it for free via this link: In Gold We Trust 2020.
One of the main themes from this years issue, and one I have been reporting on, is that central banks may have finally crossed the Rubicon into not just supporting their respective economies during recessions but full on debt monetization and monetizing of current government spending. My video “Meet Your New Fed Chairman; Donald J Trump” was my most popular and controversial video and discussed this subject.
This may sound good to many people that advocate for MMT, socialism, or are ignorant of history. However, those of us that are not ignorant of history realize that unrestrained government spending and debt always leads to monetary malfeasance by governments.
A few snippets from the report to get your juices flowing:
The normalization of monetary policy is off the table long before it could be completed. Quantitative easing is now (again) the norm because of the prevailing zero interest rate level. The dimensions of the new QE programs beggar the imagination. At the height of the financial market panic, the Federal Reserve dished out USD 1mn every single second, day and night, for two weeks. It should be noted that monetary policy had already turned around in the second half of 2019 in order to combat the looming recession early on.
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There is unanimity among governments and central banks on how to combat the economic consequences of the Covid-19 crisis: As many people as possible should be saved, whatever the cost. Après nous le déluge – the level of debt no longer matters. The combination of an unprecedented economic collapse and soaring debt levels is explosive. The debt is now threatening to get out of hand for good. After the Covid-19 crisis, a worsening debt crisis looms. It will probably no longer be possible to finance the debt, as global savings volumes are no longer sufficient to cover the financing requirements necessary to keep the electronic printing press up and running.
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The dramatic debt developments are increasingly undermining the independence of central banks. The intertwining of fiscal and monetary policy is progressing steadily. For example, in April the very traditional Bank of England broke a fundamental taboo and is now financing the government deficit through direct government bond purchases. In the US, too, central bank circles are now openly considering the official interlinking of fiscal and monetary policy. All of these are steps that point further in the direction of implementing the controversial Modern Monetary Theory (MMT).
I really suggest you take the time to read and understand this report.
If gold can’t go up to new highs in this environment it will never go up. We have seen all time highs for gold in most other world currencies. It is my view we see all time highs in the dollar gold price this year.
Got gold?