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Dear Fellow Investor,
I just had an amazing conversation with one of today’s top experts on gold.
Actually, it was only the latest in a string of incredibly insightful talks I’ve had over the last couple of weeks, with not only renowned authorities but every-day investors trying to figure out these topsy-turvy markets.
You see, I just spent a bit over a week on the annual Real Estate Guys Summit At Sea, speaking to an avid audience of wonderful investors.
Along with other speakers like Robert Kiyosaki, Peter Schiff, Chris Martenson, Adam Taggart, G. Edward Griffin and Dana Samuelson — along with The Real Estate Guys themselves, Robert Helms and Russ Gray — I gave my views and received tremendous feedback from the attendees and other faculty.
Then, almost immediately upon my return, I joined leading gold expert Ronald-Peter Stöferle of Incrementum AG on our Gold Newsletter Podcast for an in-depth discussion of the powerful secular trends affecting not only gold but the global economy.
Add it all up, and it was a wonderful chance to completely re-evaluate my views on the markets — a “check your premises” opportunity, as Ayn Rand would put it.
The result: I continue to believe that we have entered a period of monetary policy that is at once both familiar and unprecedented.
It’s familiar because it’s been repeated time and again throughout history. Human nature never changes. And that’s why governments and civilizations have always overspent their means, building debts that crush their finances.
In every instance, over thousands of years, the prescription has always been the same: Depreciate the currency to devalue the debts.
Today’s situation is unprecedented because, for the first time, the world economy is thoroughly interconnected and completely interdependent. Thus, every developed economy has run up massive debts...and every economy is in the same dire situation.
This means that currencies can’t effectively devalue against each other — they’re all racing down the same hill. And thus, they can only devalue against real assets, primarily gold and silver.
But that’s not all...
Governments didn’t need any encouragement to spend as their economies slowed. But interest rates at 5,000-year lows certainly threw gasoline on the fire of debt creation.
The current levels of debt have dire implications, including:
• Previously “normal” interest rates are no longer possible without a major monetary reset — the debt service burdens at rates just a bit higher than today’s would swamp government budgets.
• This means that real rates (adjusted for inflation) will remain low, and even negative, on an ongoing basis. This is tremendously bullish for gold.
• Rates are currently so low that there’s no room to cut in the event of the inevitable next recession. Thus, the Federal Reserve will have to proceed quickly to quantitative easing.
• In the next crisis, the Fed will have to employ an even greater degree of QE to have any ameliorative effect on the markets and sentiment. The patient has developed a tolerance for the drug of monetary easing.
• At some point, the very credibility of the current U.S. and global currency framework will be brought into doubt. Whether it’s this boom-bust-easing cycle or the next one or the one after that, people will demand some solid backing for their currency.
Of course, that backing will be gold.
Now, I won’t pretend to predict the precise path that all this will take. It’s impossible to know.
But the one thing we do know with a fair degree of certainty is that gold will protect wealth during these crises, as it always has.
Get Ready Now
One thing I’ve learned from living through a few major hurricanes along with several secular market cycles is that complacency kills.
There are ways to make a lot of money from the next big crisis, but I’m not talking about that now.
I’m talking about your very financial security.
Again, we don’t know exactly how the next “big one” will develop, or the timing. But we do know that gold will be there, as always, to safeguard our wealth.
If you don’t own physical gold and silver, you need to acquire this vital insurance now.
A Quick Catch-Up On These Major Trends
You can get a quick and very insightful summary of many of these issues by listening to our latest Gold Newsletter Podcast with Ronald-Peter Stöferle.
It’s just been posted, and it features a preview of Incrementum’s next edition of their very popular “In Gold We Trust” annual report on the gold market.
This is extremely valuable economic analysis that you won’t find in the mainstream financial media. I urge you to listen to it now, by clicking on the link below.
All the best,
Brien Lundin
Editor, Gold Newsletter
CEO, the New Orleans Investment Conference
CLICK HERE
For The Latest
Gold Newsletter Podcast
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