3 Min. Gold News – This Week in Gold – July 12, 2019

July 12, 2019

Here’s How Gold Moved This Week:

Gold Spot July 12, 2019
Gold Spot July 12, 2019 from http://www.gold.org Gold Hub

 

TOPICS:

Jerome Powell
Gold Standard
Hungary & Poland
Stable Prices
Judy Shelton
Bitcoin

 

Screen Shot 2019-07-12 at 12.13.03 PM

Gold now sits at $1,415.30 US/oz.   from kitco.com

Jerome Powell

Jerome Powell, the Federal Reserve Chair spoke this week to the US government.

Here it is in a nutshell:

The US is doing fantastic but it’s a global and interconnected world and the rest of the world is not doing so well. Whatever the Fed does, raising or lowering interest rates and buying government bonds, has a time lag in its effect.

He’s hinting at dropping interest rates because:

  1. Uncertainty with trade between nations and with
  2. Slowing global growth

He gave a “whatever it takes” reassurance (just like the European Central Bank did) that you can borrow more and more. Whoo hoo. All good. They’ve got your back.

He answered the concern that the US could stop being the world reserve currency. He said there wasn’t anything to take its place yet. There’s nothing big enough out there. Then he said having two or three reserve currencies that all act together would be fine.

This would help the situation where the US right now has to think about the whole globe’s best interest instead of just it’s own. If there were a few reserves/trade currencies then the US could print to the brink of loss of confidence, backed by nothing, and rely on the other reserves to “save” the world. I’m sure that’s not what he was thinking. Right.

Powell said that the US could lose its reserve status if it wasn’t fiscally responsible, but that was a long way off…….riiiiight.

Jim Rickards, in his book Death of Money said the IMF’s SDR (special drawing rights) is world money not openly declared. The IMF declares the SDR is:

  1. a store of value
  2. unit of account
  3. medium of exchange

That’s money used only by the elites.

Rickards says they want to solve their sovereign debt problems using inflation, by using the SDR which is opaque and has no accountability. The next crisis will see the IMF print endless SDRs, nations pay their debt with the inflated currency (mentioned above), and then the lag in time (Powell mentioned above) when inflation hits the masses, can be blamed on the IMF. Who aren’t elected.

Too bad for the masses who suffer. It saves their system for them. That’s the central banker plan.

GOLD STANDARD

Powell was asked what he thought of bringing back the gold standard.

He’s not a fan, naturally.

He’s got to try to deflect gold as money from the narrative because money backed by gold would mean they could not print rivers of currency, “whatever it takes” to keep this system of debt-based money going.

HUNGARY AND POLAND

But at the same time central banks around the world are buying physical gold and bringing their gold back from storage in other countries.

Bullionstar.com’s Ronan Manly talks about it here: www.bullionstar.com

Nations don’t look like they’re confident in what the debt system is serving. Hungary, after 32 years, increased its gold holdings 1,000% last fall and brought its gold home from storage in England.

Poland joined this week. They just bought 100 tonnes, and they’re bringing it all home from the Bank of England. That means Poland has a lower fear of being taken over by Russia than of having their gold confiscated or withheld from them by the fractionally-backed LBMA controlled gold trading centre in London.

Gold as a backing behind the numbers on the currency means you cannot print more dollars that the physical gold allows. Want more currency? Get more gold by growing your GDP and buying/mining the metal.

GOLD FOR STABLE PRICES

The US Fed has two mandates:

1. Stable prices
2. Maximum employment.

Weird thing is that since the Fed arrived the US dollar has lost 97% of its value. Not so stable. The exact opposite of stable.

Lynette Zang at ITM Trading did a good YouTube video on this:

Zang said the most stable prices happened when the US was on a Gold Standard from 1834 – 1861 (36% between highest and lowest prices) and between 1879 – 1914 when there was an International Gold Standard (20% between highest and lowest).

Between 1971 when the US dropped the gold standard and the 2009 crisis there was 432% between the highest and lowest prices.

Powell said that the price of gold fluctuates and that’s not so good for consumer price stability and employment.

He said their mandate would have to change to looking to make the price of gold stable instead of their current mandate.

No kidding.

If there was a gold standard it would be the gold that keeps the prices stable, keeps consumers confident in the value of their assets and currency, and that is what increases business expansion and hiring.

JUDY SHELTON

President Trump’s nominee to join the Federal Reserve is Judy Sheldon. She’s in favour of backing the currency, at least partially, with gold.

Her points:

  • Money is supposed to be that unit of account that gives clarity.
  • It’s supposed to be a dependable store of value and not a government policy instrument to try to engineer outcomes. Central banks have engineered the system into negative interest rates. That stops faith in the future, the thing that capitalism is based on.
  • Capitalism is based on sacrificing today instead of consuming. To invest it as a seed in order to get a greater harvest.
  • If you stop believing that the rules of sowing and reaping will work then you stop sacrificing today and instead consume everything you can.

Capitalism, when it’s allowed to work without fraud, inspires hope and faith in the ability to sacrifice now and see a better tomorrow.

But empires rise and fall in patterns. They are closed systems.

When they reach maximum expansion there’s usually a looting that takes place – those with inside knowledge stop sacrificing for the greater good and loot quickly before the masses find out. Then the empire falls within and/or without.

Why do public servants in the US government have multiple millions in the bank? How did they get that?

The rule of law needs to be applied and there has to be trust in it.

Gold as part of a money supply means it can be trusted when people completely suck and the system is being looted to your loss.

Gold is physical. It’s heavy. It’s hard to get. It’s indestructible once it’s here.

Gold as part of a standard?

There would be no need for central banks or the debt system.

Anywhere in the world.

It’s a system based on debt. The paper we carry around is a debt to us. We put it in a bank and it becomes a debt from the bank to us.

Things are so whacked out now that bonds, which are debt, are being treated as an asset. Martin Armstrong talks about that on his site Armstrong Economics.

The seven largest systemically critical banks in the US said the same thing to the government in April of this year – no gold standard please.

Not good for the banks.

In this current system the elite in the banking and political world have personally benefited and the citizens of the globe, en masse, have lost.

Global debt is up 50% over the last ten years.

They must keep inflation high so that the number of dollars they have to pay back stays the same, but each one is worth less and less: less new dollars are needed to pay back the old debt.

It’s a way of cheating what is repaid.

We were all taught that numbers have value. But they don’t in themselves. They just represent a value and in a debt-central bank model society that number has to always grow, or else the system collapses.

The Federal Reserve is a bank, so it’s all about debt and leverage.

Gold is about a store of value.

BITCOIN

Powell was correct when he said that bitcoin isn’t seen as a medium of exchange. It’s being used as a speculative store of value. He sees people buying gold as a speculative store of value also.

But he knows what other central banks are doing, and they’re buying gold.

President Trump said he isn’t a fan of Bitcoin and cryptocurrencies. The reason is stated above by Powell – it’s being seen as a speculative store of value. Trump doesn’t see that as beneficial to himself or the nation. Some individuals see it differently. They believe it’s the future and it will go up to $100,000 per Bitoin or more as the central bank model falls apart.

We can expect that the Fed and the ECB will lower their rates which means they want more people to borrow money, get further into debt, and keep the debt model growing.

There’s a lot of debt that’s coming due soon, so if the central banks raise the interest rates then more of that debt would default. Then banks would crash.

All of the low and zero rate interest loans they’ve given were to inflate the prices of houses, the stock market and bonds, and therefore save the huge derivative market.

The derivatives are all just big bets on whether prices go up or down. If interest rates are at zeroish then you need to try to make something – so you make a bet.

If people bet the prices will go up and they go down instead then they lose money. The global money that could be lost is in the quadrillions now.

It dwarfs the size of the global GDP.

That’s a scary game.

But, everything’s fine.

Everything’s fine.

Elaine~

 

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Cover - EDT - World Without an Anchor

World Without an Anchor
words and music | Elaine Diane Taylor
©2019 Elaine Art & Media
ASCAP/SOCAN

Single available on iTunes.

In a world without an anchor
you’re subject to the sea
Right before a tempest
Left screaming at the breeze
Walls of rage and water will test what you have learned,
That in a world without an anchor coins are tossed and boats will burn.
There’ll be ships that lie deep (in) state beyond (the) reach
Who will wear a yellow vest?
Who will wash up on the beach?

from “World Without an Anchor”

……………………………………….

Not Much of a Holiday

words and music Elaine Diane Taylor

© 2015 Intelligentsia Media, Inc. All rights reserved.

SOCAN/ASCAP

Single available on iTunes

Bank holidays and long lines at ATMs to get enough for the day. Debt deals behind closed doors. The media telling us what to believe. China building islands in the South China Sea and claiming all the international waves. Markets close and rockets crash. Silken road, treasure, files hacked. Oil, fusion cold. News and nations all sold. More dealing to come. More standing in line for those who owe. Who owes? There’s a long line of nations in debt and this is far from done.

……………………………………….

AlbumCover.PreparingfortheFall

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

……………………………………….

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.

The costs go up and the jobs go down. Hunger goes up and hope goes down. Then anger goes up and it all goes down.

 

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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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