3 Min. Gold News – Jim Rickards – The New Case for Gold – April 5, 2016

3 Minute Gold News

A Quick Read for Busy People

A synopsis of an interview with Jim Rickards, New York Times bestselling author of The New Case for Gold, The Death of Money and Currency Wars, by Maria Bartiromo at Mornings with Maria on Fox Business.

Jim is the editor of Strategic Intelligence, Chief Global Strategist for West Shore Funds, former general counsel for Long Term Capital Management, and a consultant to the U.S. Intelligence community and U.S. Department of Defense.

Topics:

 

Trump Recession Prediction
What Kind of Gold?
Stock Market and Gold
No Yield
China

 

 

Rickards - Brisbane

Jim Rickards

Interview Link

TRUMP RECESSION PREDICTION

Jim agrees with Donald Trump’s prediction that the U.S. is heading into a recession.

There’s social science research that says monkeys are better at predicting the economy than economists. Monkeys are right 50% of the time because they don’t know what they’re doing and economists “herd” and are wrong most of the time.

The Fed has never predicted a recession and there have been many. So don’t listen to economists – listen to executives.

Trump may or may not be right, but Jim would rather listen to an executive than an economist.

Jim recommends owning 10% of your investable assets in physical gold to sheild you from a recession.

Some people say to sell everything and buy gold but Jim doesn’t recommend that.

If he’s wrong and gold does nothing then you don’t get hurt with 10%, but if he’s right and everything else crashes or Trump’s right and there’s a recession then gold will go up by multiples. So that’s your insurance against the other losses in your portfolio.

But there are new 21st century reasons for owning gold, which Jim talks about in the new book, released today, The New Case for Gold.

Screen Shot 2016-04-03 at 10.47.48 AMVladamir Putin has a 6,000 person cyber brigade working night and day to erase digital wealth.

When Jim asks people what they own and they answer that they have stocks and bonds he says, “No you don’t. You have electrons.” Putin can wipe those out.

The thing about gold is that you can’t hack it. You can’t erase it. You can’t delete it.

It’s tangible.

WHAT KIND OF GOLD?

You don’t want paper gold — ETFs, Comex futures, London Bullion Market unallocated gold.

The reason is that when you most want your gold they’ll terminate the contract early or close the exchange so you can trade for currency only — you won’t be able to get the gold.

They trade a hundred times more than the gold they have, and that’s okay because they also trade for large open interest. But if one hundred people want their gold then one is getting the gold and the rest are shut out.

So have physical gold — bullion, coins, American gold eagles (Canadian maples). Just 10% and put it in a safe place. Not in the banks but in private storage.

STOCK MARKET AND GOLD

Gold sometimes corrolates with the stock market and sometimes not.

Ben Bernanke famously said that no one knows how to value gold, but that’s not true.

Gold is inverse to the dollar.

So if you think the dollar is going to be really strong you don’t want gold, if you think the dollar is going to weaken then you definiately want gold.

A weaker dollar is a higher dollar price for gold.

The U.S. dollar is at a ten year high so it’s got to come down. Cross rates are just a see saw — they can’t all go down at once or up at once.

The stock market has gone nowhere since 2015. It’s volatile. It went up a lot in the last six weeks and went down a lot before that. Gold is the best performing asset in 2016 and the best performing asset class of the 21st century.

From August 2011 to November 2015 gold went down 45% — that’s a typical retracement in the commodities market. You don’t see commodities go to the moon without a 50% retracement first.

Jim doesn’t day trade gold. It’s a slice of his portfolio to preserve wealth.

There’s a difference between preserving money and making wealth.

NO YIELD

Some people don’t want to invest in gold because there’s no yield. But there isn’t supposed to be yield because it’s money.

If you take a dollar out of your purse what’s the yield?

Zero.

If you want yield you have to take risk. If you put it in the bank you take risk.

CHINA

China also thinks of gold as a hedge.  They have $2 trillion in U.S. currency and they’ve been buying thousands of tonnes of gold. They have more than they report, which you can tell by looking at Hong Kong imports and mining reports of geological surveys.

With $2 trillion in U.S. paper money the Chinese want a strong dollar, but they suspect the U.S. government will inflate it.

And they will. Janet Yellen has said she wants inflation.

As the U.S. dollar goes down in value through inflation gold goes up — they’re hedged.

Jim Rickards can be found on Twitter and at James Rickards Project.

 

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Gold is $1,228.40 U.S. per ounce.

Screen Shot 2016-04-05 at 10.06.14 AM

 

 

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Not Much of a Holiday
words and music Elaine Diane Taylor
© 2015 Intelligentsia Media, Inc. All rights reserved.
SOCAN/ASCAP
Single available on iTunes

The Greek bank holiday and long lines for a few euros a day. Debt deals behind closed doors. Media telling us what opinions to have. China building islands in the South China Sea and claiming all the international waves. More dealing to come. More standing in line for those who owe. Who owes? There’s a long line of nations in debt.

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AlbumCover.PreparingfortheFall

 

Preparing for the Fall live boutique album is available on iTunes — featuring Wag the Dog, Black Swan Dive,  American Pie and Gods of the Copybook Headings.

 

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Coins and Crowns
words and music Elaine Diane Taylor
© Intelligentsia Media Inc. All rights reserved.
SOCAN/ASCAP
from the album Coins and Crowns available on iTunes

Single featured in Episode 1 of Mike Maloney’s documentary series Hidden Secrets of Money.

When a nation leaves the gold standard and sound money, and borrows to go to war, then hunger goes up, hope goes down, anger goes up, then it all goes down.

 


The Gods of the Copybook Headings
words by Rudyard Kipling and music by Elaine Diane Taylor
©2014 Intelligentsia Media Inc.
SOCAN/ASCAP
from the album Preparing for the Fall available on iTunes

The copybooks of the early 1900s gave us all the wisdom we need. The sayings that were copied are the truths, the gods, of our world. All the empires who followed the gods of the marketplace instead have fallen, and there’s terror and slaughter when the gods of the copybook headings return. The lyrics are by Rudyard Kipling. One of my gurus.

 

Another Week on Wall Street
words and music Elaine Diane Taylor
© 2013 Intelligentsia Media Inc. All rights reserved.
SOCAN/ASCAP
from the album Coins and Crowns available on iTunes

See the bankers wave their Wall Street wands and conjure piles of paper green. Naked short selling is like betting that your neighbour’s house will burn down. But in this scenario it happens to burn down. If the bankers win then we lose the whole world as we know it. I wrote this in 2009, with a lyric “A little grease (Greece) is floating out to sea, and little pigs (Portugal, Italy, Greece and Spain) are bobbing up and down, they’ll send a storm and we’ll see, when the tide goes out who’s naked on the beach“, and it’s coming on now. The world is changing as we know it.

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Nothing on this site is intended as individual investment advice. We’re all watching which way the wind is blowing.

 

 

 

 

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