Why Gold Prices Might Fall: This is Not Stagflation, This is a Government created economic Depression propped up by Central Banks – September 30, 2021,
If you’re under the impression the world is returning to a
Gold Standard anytime soon, don’t assume that’s a good thing for the gold price. We’re in a politically-Progress era in politics, meaning that REGULATIONS are the new Marxism. Marxism wants the government or central authority to controls the means of production, Progressive ideologies which are really champagne-socialist ideologies in disguise want the government to steer the private sector into a direction of its making.
In case you haven’t been paying attention, most Democratically elected Western leaders aren’t that smart, in fact, it appears that voters prefer voting leaders who will allow them to claim victimhood under the law in some respect. Social justice is or politics in the boardroom, are bad for the economy.
Gold and Silver are the best forms of money, but the fiat money system is a confidence game and so far there is a lot of confidence in the U.S dollar.
As many people know, most of the U.S dollars in circulation are digital, and most of the U.S dollars in circulation are based on what’s owed back as opposed to what’s being physically hoarded. That aside, as the global economy shrinks, historically most countries will debate their currencies to the U.S dollar to pay for their government spending.
Now, in theory, the price of Gold and Silver should skyrocket, but in practice, the opposite might happen, the price of Gold and Silver may actually retreat, not because of sound economics, the price will retreat because there’s a misallocation of resources and the U.S dollar confidence game is still a system people trust in.
Now, this Gold and Silver price retreat I expect is going to hit most investors by surprise, but it’s going to change once a new price discovery is found and everything else rises in price. Why you shouldn’t confuse the current economy with stagflation is because there is MISALLOCATION of jobs in most Western countries. As an example, there’s an artificially created demand for a greener economy, there’s a government-infused artificial demand for social justice, which will not only make it harder for businesses to hire but also to fire people.
The minimum wage law is actually more destructive than people understand because it doesn’t allow the cost of labor to deflate and because the minimum wage is compounded with other labor union social justice initiatives the cost of labour is forced upward, which means that as I’m writing this right now the market is working to rediscover prices. Social justice types don’t sit still either, their social justice dichotomy often finds any injustice it can find to justify its existence and this could fuel inflation.
As we’re observing people who do not speak or behave in the manner the Progressives want them to are not only losing their economic livelihoods, they’re exiting their respective workforces altogether. Now, in some instances the best and brightest Western societies have to offer are being replaced at the corporate level by “social justice” types.
From an economics perspective, this has depression written all over it, but if you’re a believer that fiat money is sound money, chances are you’re going to trade in your Gold and Silver when the fiat price takes a dip or even when it rises.
The world as we know is awash with oil and by now the oil cartels know that they yield a lot more power over the economy than they could have ever imagined, because as we know there isn’t a real demand for a greener economy, if you watch people’s spending patterns, they’re still buying fossil fuel-derived products in record numbers. Amazon is filled with fossil fuel products. We can pretend plastic and polyester all the comfortable stretchy fabrics like aren’t derived from fossil fuels all we want, the bottom line is demand for fossil fuels are INCREASING and therefore economic deflation is taking over.
Higher fiat prices equate to more government stimulus especially as private businesses rediscover prices, now once price discovery is found, I expect the price of both Gold and Silver to shoot up, but this could take some time, especially if inflation runs red-hot.
The Federal Reserve if it normalizes rates will be bad for Gold and Silver and it might even bad for Gold and Silver if it keeps rates the same or lowers rates because we’re in a confidence game cycle and people still put a lot of trust in the U.S dollar because as I like to point out, the problem is not so much the Federal Reserve the problem is democracy and Progressive minded politicians.
Most people do not understand that price controls are the death knell for the economy, if the private sector can’t turn a profit it’s forced to raise prices, if people aren’t qualified or have the option NOT to find a job that accelerates the U.S dollar debasement, but because of the confidence factor in the worlds reserve currency, the U.S economy will enter a permanent state of depression until it cuts regulations. If you don’t see that happening anytime soon, you’re not alone!
Interesting times ahead!