3 Min. Gold News – 2020 in Gold – Jim Rickards with Kitco News – Jan. 14, 2020

January 14, 2020

Synopsis of an interview with James Rickards, author of the bestselling books Currency Wars, The Death of Money, Road to Ruin and A New Case for Gold, with Daniela Cambone, the Editor-in-Chief at Kitco News.

Jim’s new book is Aftermath: Seven Secrets of Wealth Preservation in the Coming Chaos.

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TOPICS:

Inflation
Recession
Inverted Yield Curve
Gold & 2020 Investing

 

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Video Link

 

INFLATION

Money itself doesn’t cause inflation. What causes inflation is velocity – the high turn over of money.

We don’t have that.

It’s nothing to do with the Fed and nothing to do with the printing press. Velocity is psychological in that it depends on how people feel.

If people are feeling prosperous or if they’re worried about inflation (thinking something will cost more tomorrow) then they’ll spend their money. If they’re worried about their balance sheet and not worried about inflation then they’ll save it or invest it.

Psychology can’t be changed by a central bank.

Gold is an excellent way to change psychology, but that’s not something the central banks are thinking about.

RECESSION

The three-to-six month forecasts, depending on the models, can be extremely accurate.

There are independent analysts and economics who are giving a zero chance of a recession in the next six months.

Jim agrees with them.

He also puts the chance of a recession in the next year at less than 30%.

Monetary policy by the Fed operates with a time lag.

So, the slow down we’re seeing right now, with GDP growth dropping in 2019 from 3% down to 2%, is the effect of the Fed tightening in 2017 and 2018.

They raised rates four times in 2018 and also did QT at the same time, reducing the money supply.

But they got rid of the QT in 2019 and increased the money supply while they cut interest rates three times.

All of that easing will show up in mid-to-late 2020.

YIELD CURVE

The yield curve inverted last August, so when you looked at 3 month bills vs. 10 year notes the short term interest rate was higher than the long term rate.

Yield curves inverting can signal a recession, but not for another almost 2 years down the road – so maybe 2021.

To fix it and not lead into a recession the Fed could either lower the short term interest rates or increase the long term rates.

They decided to lower the short term rates.

The Fed is buying $100s of billions in Treasury bills right now. They started off saying it was a short term thing, but the amount keeps getting bigger and bigger.

And it works.

GOLD & 2020 INVESTING

Jim still allocates 10% of his investable income into physical gold as a hedge. But only 10%, saying that if he’s right about his price predictions for the metal then 10% is insurance against losses in the other 90% he has invested.

His prediction for 2020 is that stocks will have a good year.

 

Jim can be found at www.jamesrickardsproject.com and on Twitter.

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Here’s How Gold Moved This Week:

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And Last Year:

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from The Gold Hub at www.gold.org

My thoughts…

As the episode with Iran became tense last week we saw gold shoot up in demand and price, as it does with global unrest. The price then calmed back down right along with the situation. Right on cue.

The thing about holding physical gold is that demand goes straight up in global strife, but it’s then less available.

Kitco News developed a mobile app that tracks gold, silver and mining stocks. I love it! They just won the award for Best Mobile App Design at the Canadian Online Publishing awards. Congrats!

I’m doing behind-the-scenes work right now. Still living in Victoria, Canada, for a little while but I haven’t run into Meghan or Prince Harry yet. ;)   Snowing at the moment, but guitar practice and the workout this morning weren’t held up by the flakes. My schedule starts at 5:30 am. Everything is on track. The study right now is on the history of memory. “The Art of Memory” by Francis Yates covers how we thought of consciousness, imagination, power to control and the use of memory, from the Middle Ages into the Renaissance. What we as a culture believe we can think about and imagine has a great impact on how we view ourselves and our ability to control the circumstances and our own destinies. I’m tying this into gold and our view of money and debt. For songwriting.

Have a lovely 2020. I hope you spend the year thinking of what you want to see come about instead of what you fear will come to pass. Create some wonderful moment, and invest your time, effort and money in what builds the kind of world you want to live in.

I appreciate all the golden people I have the pleasure of knowing, and look forward to a memorable year of expansion.

Talk to you soon,

Elaine~

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Gold now sits at $1,546.50 US/oz.   from kitco.com

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Coins and Crowns

words and music | Elaine Diane Taylor
©2019 Elaine Art & Media
ASCAP/SOCAN

 

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. Anger goes up and it all goes down, down, down.

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

In a world of flags and spices
We were playing pipes and drums
Sailing on the winds
Selling souls and sums
Gold floating one way
Silver in return
But in a world without an anchor
We all drown in debt in turn
There’s ships that lie
Deep in state beyond the reach
Who will wear a yellow vest?
Who will wash up on the beach?

In a world of borrowed soldiers
The captains’ damage owned
Treasure chests are missing
And the golden anchor sold
We are fed with cake and follies
We are tethered to the shell
Bailing out the breaches
They’re now bailing in the hell
There’s ships that lie
Deep in state beyond the reach
Who will wear a yellow vest?
Who will wash up on the beach?

 

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Not Much of a Holiday

words and music | Elaine Diane Taylor
©2015 Elaine Art & Media
ASCAP/SOCAN

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.

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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.

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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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