Crazy Moves Ahead! Upcoming Gold & Silver Rally are Going to Shake the World - Alasdair Macleod
TLDRAlistair Macleod discusses the increasing instability of the credit system and a global shift towards tangible assets like gold. He notes a rise in commodity prices and gold's strength as investors seek havens from volatile credit currencies. Macleod anticipates higher inflation rates fueled by the devaluation of credit, with potential risks to financial stability from malinvestments in sectors like commercial real estate and private equity.
Takeaways
- ๐ The value of commodities priced in gold has been remarkably stable over a long period, but is now becoming more volatile and tending to rise.
- ๐ฐ People are moving away from credit and into solid assets like commodities and physical gold due to the instability of the credit system.
- ๐ Gold prices have surged by 12.6% year-to-date without significant support from Federal Reserve policy, a weaker dollar, or increased institutional investment.
- ๐ The shift from credit-based assets to tangible ones is driving inflation rates higher, potentially masking the true extent of inflation through official government statistics.
- ๐ The devaluation of credit is expected to fuel inflationary pressures as market speculation and data indicate.
- ๐ The rise in gold prices is not due to gold increasing in value, but rather credit declining, which may lead to a shift in the global financial landscape.
- ๐ฅ The US economy is considered to be bolstered by government spending rather than resilient, as personal savings are not increasing.
- ๐ฆ There is potential exposure to malinvestments, especially in sectors like commercial real estate and private equity, due to higher interest rates.
- ๐ Rising interest rates are likely to reveal unsustainable leveraged positions, posing risks to financial stability and investment portfolios.
- ๐ The preference for gold over dollars by foreigners is driving the demand for physical gold, indicating a substantial reevaluation of the credit system.
- ๐ The global economy is experiencing a shift with heightened concerns over inflation and the stability of the credit system, leading to an increased interest in gold as a safe haven asset.
Q & A
How does the value of a basket of commodities change over a long period when priced in gold?
-The value of a basket of commodities remains remarkably stable over a long period when priced in gold.
What is the current trend in commodity prices and how is gold related to it?
-Commodity prices are rising, and gold is going with that flow, indicating a shift from credit to more solid assets.
What is the significance of the 100 trillion dollars of credit currency in the market according to Alistair Macleod?
-The significant amount of credit currency in the market is leading people to move from credit-based assets to tangible ones like physical gold, which is seen as a more stable asset.
How has the gold price performed year-to-date in the context of the current economic situation?
-The gold price has surged by 12.6% year-to-date, showing strength despite the absence of significant support from Federal Reserve monetary policy changes or a weaker dollar.
What does Alistair Macleod suggest will be the impact of the shift away from credit-based assets on inflation rates?
-Alistair Macleod suggests that the shift away from credit-based assets will drive inflation rates higher, potentially masking the true extent of inflation through official government statistics.
What is the role of the Federal Reserve in the current economic scenario according to the transcript?
-The Federal Reserve is cautious about rate cuts and is focusing on core CPI, excluding volatile energy and food prices, to assess inflation. It is also noted that the Fed's policy adjustments have led to financial strain for many households.
What is the potential risk that Alistair Macleod highlights in sectors like commercial real estate and private equity?
-Alistair Macleod highlights the risk of malinvestments and unsustainable leveraged positions in sectors like commercial real estate and private equity, which could be exposed by higher interest rates.
What is the significance of the US government's spending according to the transcript?
-The transcript suggests that the US government's spending, which is not backed by an increase in personal savings, is artificially bolstering the GDP and masking the actual poor state of the economy.
How does the transcript describe the role of interest rates in the context of the global economy?
-The transcript describes interest rates as a crucial factor that compensates foreigners for holding a foreign currency. It also suggests that higher interest rates are likely to stay due to the need for this compensation and the large amount of financial securities and bank deposits held offshore.
What is the implication of the shift towards gold and away from credit-based assets according to Alistair Macleod?
-Alistair Macleod implies that this shift will have profound implications for the broader financial landscape, indicating a substantial reevaluation of the credit system and evolving dynamics within the global economy.
What does the transcript suggest about the future of gold investments?
-The transcript suggests that the rise in interest among gold investors may persist due to the ongoing concerns over inflation and the stability of the credit system, reflecting a growing appetite for safe-haven assets amidst economic uncertainties.
Outlines
๐ Commodity Stability and Gold's Rising Value
This paragraph discusses the stability of commodity values over time when priced in gold, contrasting it with the volatility seen when priced in fiat currency. It highlights the current trend of rising commodity prices and gold's alignment with this trend, suggesting that the shift from credit to tangible assets like gold is driven by a desire for solidity in investment. The paragraph emphasizes the strong performance of gold, not due to its own increase in value, but rather the decline in credit value, and points to a significant amount of credit currency in circulation. It also notes the surge in interest among gold investors as a response to potential economic hard landings and the instability of the credit system, as explained by Alistair McLoud, head of research for gold money.
๐ก Inflation, Credit Devaluation, and the Impact on Financial Stability
The second paragraph delves into the implications of credit devaluation on inflation rates, questioning the accuracy of official government statistics like the Consumer Price Index. It suggests that the devaluation of credit will fuel inflationary pressures, despite what official figures may indicate. The discussion includes the anticipation of higher inflation rates driven by a shift in investor behavior from credit-based assets to tangible ones. The impact of rising interest rates on various sectors, particularly commercial real estate and private equity, is also explored, with a warning about the potential exposure of malinvestments. The paragraph concludes with a critical view of the US economy, highlighting the government's spending as a factor in the GDP, rather than an indicator of economic resilience.
๐ Global Economic Shifts and the Future of Gold Investment
The final paragraph summarizes the global economic shifts towards gold as a safe haven asset amidst concerns over inflation and credit system stability. It reflects on the potential persistence of the rising interest in gold investment and its impact on traditional investment strategies. The paragraph invites viewers to share their thoughts on these developments and to join the community for more updates and discussions on the topic.
Mindmap
Keywords
๐กCommodities
๐กCredit Currency
๐กInflation
๐กFederal Reserve
๐กSafe Haven Asset
๐กMalinvestment
๐กInterest Rates
๐กPurchasing Power
๐กDevaluation
๐กMarket Speculation
๐กGlobal Economy
Highlights
The value of a basket of commodities is remarkably stable when priced in gold over a long period of time.
Commodity prices are rising, with gold following this trend, indicating a shift from credit to more solid assets.
Alistair Macleod suggests that the inherent instability of the credit system is driving investors towards tangible assets like physical gold.
Recent data indicates a potential hard landing in the US economy, sparking a surge in interest among gold investors.
The gold price has surged by 12.6% year-to-date without significant support from Federal Reserve policy or a weaker dollar.
Macleod anticipates that the shift away from credit-based assets will drive inflation rates higher, despite official statistics potentially masking the true extent of inflation.
The devaluation of credit is expected to fuel inflationary pressures as people understand the declining value of credit.
A substantial reevaluation of the credit system is underway, with profound implications for the broader financial landscape.
Physical gold is considered real money with no counterparty risk, unlike paper gold or other credit-based financial instruments.
The rise in gold prices is not due to gold value increasing, but rather the declining value of credit, leading to a shift towards gold as a safe haven.
China has been stockpiling copper and silver, reflecting a global trend of moving towards commodities as a store of value.
The US economy is heavily reliant on government spending, which is not sustainable and is masking the true state of the economy.
Higher interest rates are likely to reveal unsustainable leveraged positions, particularly in commercial real estate and private equity sectors.
The Federal Reserve's focus on core CPI, excluding volatile energy and food prices, has revealed unexpected rises in the past two months.
The rise in interest rates is expected to have a lasting impact as it compensates foreigners for the risk of holding dollars.
There is an estimated 128-130 trillion dollars of credit currency and credit that may become undesirable, affecting the value of the dollar.
The shift in investor preference towards gold and commodities could signal a major realignment in the global economy.
Macleod suggests that the US GDP is being artificially bolstered by government spending, rather than genuine economic resilience.