CCN/W.E. Messamore/4-7-2020
“In the truest sense of the word, this is a radical experiment in monetary expansion. But history is clear on what this experiment will mean for gold. What the Federal Reserve is doing now dwarfs the last radical monetary experiment in 2008. Back then the Fed’s interventions tripled the money supply in three years from Aug 2008 to Aug 2011. That sent gold prices on a parabolic trajectory, doubling the market value of gold in three years. History is repeating itself, but with greater speed and magnitude.”
USAGOLD note: Actually, gold more than tripled from the first signs of a financial crisis in late 2007 to the peak in September 2011, as shown in the chart below. It is interesting to note that the three factors with the most influence on the price of gold in that period were (a) worries over disinflationary risks to the financial system, (b) the fear of a recession, and (c) the prospect of future inflation.
“Ray Dalio thinks there are better assets to hold than cash as central banks print money and keep interest rates low in response to the coronavirus pandemic.”
USAGOLD note:
