Month: July 2021

Project Syndicate/Noriel Roubini/6-30-2021

“In April, I warned that today’s extremely loose monetary and fiscal policies, when combined with a number of negative supply shocks, could result in 1970s-style stagflation (high inflation alongside a recession). In fact, the risk today is even bigger than it was then…At some point, this boom will culminate in a Minsky moment (a sudden loss of confidence), and tighter monetary policies will trigger a bust and crash.”

USAGOLD note: Dr. Doom, as he is known on Wall Street, sees symptoms of a breakdown already in motion wherever he looks. He goes so far in this analysis to say that in the end we will get a melding of the 2008 debt crisis and the 1970s stagflation – pretty much a banana republic-style breakdown.

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Yahoo!Finance/Karen Yeung/7-5-2021

“China is also seeing rising capital inflows from other channels, such as foreign direct investment into China’s growing economy, as well as portfolio investment into mainland stocks and bonds. This demand for Chinese assets, in turn, continues to place upwards pressure on the yuan exchange rate, which Beijing is trying to avoid.”

USAGOLD note: A rising yuan creates a buying opportunity in gold which is priced for international trading in dollars. Asians like to buy gold and silver when it’s on the bargain table.

Gold in Chinese yuan
(One year)

Chart courtesy of TradingView.com • • • Click to enlarge

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