Much Higher Gold Prices are NOT Crazy
Egon von Greyerz discussed “3 Dozen Reasons to Hold Gold” and mentioned price targets of $30,000 for gold and $3,000 for silver. Gold sells for $1,310 and silver sells in the mid-$15s. His numbers suggest that gold could increase by a factor of 20 and silver by nearly 200. For perspective, refer to the table below.
He shows the many reasons to own gold in the following “Time Bomb – Global Risk” graphic.
Are his price targets for gold and silver impossible, crazy, ridiculous, unlikely, excessive, possible, increasingly likely, or inevitable?
Or, how crazy is thinking gold will rise by a factor of 20 to $30,000?
Big Picture Interpretation from Hugo Salinas Price:
“The Federal Reserve is in a box; it’s boxed itself into an insoluble problem. It cannot stop creating more credit, expanding its Balance Sheet, no matter what Mr. Jerome Powell, President of the Fed, may say he is doing or going to do. To stop creating more FR dollars means only one thing—total collapse of the whole humongous FR dollar scheme.”
In short… QE to infinity, which will devalue mini-dollars into micro-dollars. The Fed will try to save the stock and bond markets at the expense of the dollar’s purchasing power. Described another way… our consumer prices will skyrocket higher while the stocks most of us don’t own remain levitated. Hmmmmmm, not good except for the elite.
Another opinion: Nick Santiago: “$5,000 – $7,500 Gold Less Than a Decade Away”
Inevitable? Only a matter of time!
Others have observed the price of gold is the inverse of trust in central banks, fiat currencies, and politicians. That explains why the financial and political elite suppress COMEX paper gold prices.
The currently popular nonsense is MMT—Modern Monetary Theory or Magic Money Tree economics. Print and spend trillions of digital currency units on political projects, boondoggles, and giveaways to buy votes. What could go wrong after creating trillions in “free” dollars? Well… history shows other countries have tried and failed. The MMT socialists in the U.S. are courting disaster.
From Charles Hugh Smith:
“You see the irony: depending on expanding debt for ‘growth’ eventually chokes future borrowing, spending and investing, causing ‘growth’ to collapse in a broken heap.”
Described another way… excessive debt causes its own destruction. Over-printing has destroyed many currencies throughout history, but our central bankers indulge in the fantasy it will be different this time. I doubt it.
The Socialism Scams during the next decade:
Central Banks: Print trillions to save the stock and bond markets. (Socialism for the elite…)
Politicians: Print trillions and give to the poor and politically connected. (Socialism for the masses…)
From Thomas Sowell on Socialism:
“Socialism in general has a record of failure so blatant that only an intellectual could ignore or evade it.”
- The Fed must create ever-larger quantities of credit or risk the collapse of stock and bond markets. However, they may collapse despite Fed levitation efforts.
- Fed actions will devalue mini-dollars into micro-dollars. Higher prices lie ahead.
- Debt is self-destructive. Socialism, massive deficits, wars and MMT will hurry the process.
- QE to infinity. Inflate or die!
Historical Examples of Huge Increases… or how likely is gold rising by a factor of 10 – 20 in the next decade?
From the above table:
- The US national debt increased by a factor of 55 since 1971.
- Silver prices increased by a factor of 33 during the 1970s bubble.
- Amazon stock increased by a factor of 1,565 in 20 years.
- BitCoin increased by a factor of 2 million in less than a decade.
- Gold prices increased by a factor of 511 billion during the Weimar hyperinflation.
Given the above ratios, a gold spike higher to $30,000 is not crazy, unwarranted, or historically unlikely.
Will we see $3,000 silver? Will central bankers hyper-inflate the dollar? Will MMT “high priests of printing” create trillions of fiat dollars?
We don’t know the future, but central bankers will “print,” politicians will spend, debt will expand, and prices will rise. Gold and Silver will “catch a bid” and rise into a “Jim Sinclair Rhino Horn” pattern.
The coming gold and silver price spike will be exciting, depressing, and worrisome. The media will scream in disbelief, “Who could have seen this coming?”
From James Sinclair: “The party ends in mid-2019.”
Central Banks are Buying Gold by David Schectman
And They Call us Crazies by Bill Holter
Show Me The Money by Gary Christenson
Miles Franklin sells gold and silver. Current prices will be “bargain basement specials” when viewed from the year 2025.
Call 1-800-822-8080 and reserve your bargain basement treasures. Remember, gold and silver possess NO counter-party risk.
The Deviant Investor