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A few years ago, the well respected precious metal analyst Jim Sinclair issued a prediction that the price of gold could be valued as high as $50,000 per ounce should the markets be let loose and free to find true price discovery. On May 27, that prediction was suddenly confirmed by Bloomberg who determined that if China were to back their currency with gold, the price would need to be valued 50 times higher than the current paper spot price set each day by the Comex and London.
In fact, if the current spot price of $1192 per ounce were increased by a factor of 50, the price of gold would not just be $50,000, but would be much higher and reside at around $60,000 per ounce in U.S. dollars and thus be able to facilitate China’s use of the metal for a gold backed currency.
Are the Chinese getting close to announcing a new gold-backed currency? Well, if the record amount of Australian gold exports into China is an indicator, it may be close at hand. While the Chinese have been importing a lot of gold from Australia, it reached a new record high in 2017.
H/t reader squodgy:
“We’ve had flattening yield curve, 2% EPS, buy backs, order book crashes and Central Bank stock purchases and a world BDI reflection of future exports showing zilch trade all planned to hide the market reality…..and the Fed says everything is great.
It’s all lies”
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by Nick Giambruno, Senior Editor
A government in need of cash will turn to destructive “solutions.”
Money printing, higher taxes, and more regulations often come first. Unfortunately, these are just the hors d’oeuvres before a 10-course meal.
As they become increasingly desperate, governments implement increasingly destructive policies. This might include capital controls, price controls, people controls, official currency devaluations, wealth confiscations, retirement account nationalizations, and more.
The same pattern has played out again and again around the world and throughout history. The worse a government’s fiscal health gets, the more destructive its policies become.
This is the root of political risk.
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If you don’t own gold, you know neither history nor economics.
– Ray Dalio, Bridgewater Associates
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Paul Craig Roberts and Dave Kranzler
In a series of articles posted on www.paulcraigroberts.org, we have proven to our satisfaction that the prices of gold and silver are manipulated by the bullion banks acting as agents for the Federal Reserve.
The bullion prices are manipulated down in order to protect the value of the US dollar from the extraordinary increase in supply resulting from the Federal Reserve’s quantitative easing (QE) and low interest rate policies.