QUESTION: Been reading your writings for over twenty years, enjoying everything. Quick question, in regards to 2015.75 and the time frame for unrest, economic implosion and capital flow directional changes. Is this the time frame that gold will once again embark on a new up leg which will conclude in the famous and typical blow off phase ?
Also, do you foresee a reset with a new currency basket here in the USA or something else, that will involve gold.
Thank you Martin. have a nice evening
ANSWER: I am preparing a gold report now. Many people keep harping on the QE and how this will be inflationary. This is really rubbish. That amounts to 0.06%. A 2% rise in rates will result in an additional $340 billion increase. If rates went back to where they were in 2007, we will be looking at $1.3 trillion in interest annually. It will be the rise in interest that is inflationary, not the monetization of $85 billion. We are now looking at annual interest expenditures greater than the $1 trillion national debt in 1980. The rates will rise when they cannot sell. We are shifting from PUBLIC to PRIVATE assets. Just look at the Dow.
The new currency comes into play when we are forced by the FREE MARKETS to confront the fact that socialism is collapsing the same as communism did in 1989. This is where gold will rise, not because of hyperinflation nonsense, but because the value of money will become volatile and uncertain. That is what will impact gold. There will be NO hyperinflation for that assumes that government will honor its debts and print. Historically, they always default – i.e. 1931.
The leg up in gold will come with the realization of a crisis hits the majority. That is what we require and that comes after 2015.75.
