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Posts Tagged ‘Dollar Price of Gold’

Will Gold Trump Politics In 2017? Prospects for Gold Investors in a Trump Economy

What is Trumponomics? And do you think it’ll be bullish or bearish for gold? If Trump thinks China is keeping its currency too cheap & he’s going to do something about it, that means the dollar is going to get cheaper which is usually a tailwind for gold. The dollar price of gold is simply the inverse of the strength of the dollar, So, weak dollar usually means a higher dollar price for gold.

Is Conventional Wisdom Right about Gold and Deflation?

Conventional wisdom says gold thrives under inflation and wilts under deflation. The case for gold under inflation is easy enough. Gold rises as the dollar falls. It’s the opposite under deflation. But is conventional wisdom right about gold and deflation? Is it time to consider a different metric — not the nominal gold price — but gold’s purchasing power relative to consumer prices?

Buy Gold - Dump Treasuries: A Strategic Geopolitical Move, not a Day Trade

US Treasuries are being dumped and gold is being acquired by the largest investors in the world. This is being done not as a “day trade” but as a strategic geopolitical move. Those aims include the overthrow of the U.S. dollar as the benchmark global reserve currency. When that happens, collapsing confidence in the dollar will send the dollar price of gold skyrocketing.

The SDR Is Designed As A Rescue Operation For The US Dollar

The IMF created the SDR Substitution Account in 1969. T he core idea is that the SDR Substitution Account Central Banks allows to diversify their existing US dollar reserves in a one-time conversion away from the dollar into IMF’s SDR, comprised of the US dollar, European euro, Japanese yen and British pound, in an off-market transaction, so as not to depress the dollar’s exchange rate.

This Time Central Banks Will Need A Bailout: Make Sure You Buy Gold

In the late ‘90s, Wall Street bailed out a hedge fund. In 2008, the Federal Reserve bailed out Wall Street. But in 2018, it’s the central banks that will need a bailout. And what will happen to the dollar when the Fed loses international credibility? I worked hard for my money & I want to preserve it. I don’t want to see it wiped out. Gold will preserve my wealth & that’s why I have it.

Alarming Evidence of Gold Supply Tightness, Chinese Hoarding

China and Russia are acquiring thousands of tons of gold. The Chinese have a huge pile of U.S. Treasury Securities of about $3.2 trillion. They can’t dump the treasuries, but they are worried about inflation destroying the value of the treasuries. So what the Chinese are doing instead is, they’re acquiring gold as a hedge. Where they lose on paper, they make it up on gold.

Get in on the Ground Floor of a New Bull Market in Gold

After a long, downward slide, gold prices have finally begun to climb higher. Right now is the perfect time to get back into gold and silver investments. And we have four recommendations to get you in on the ground floor. But does the price upswing of the past few months mean that we’re in for a new, longer-term era of strength in gold? Yes. Here’s why.

Physical Gold in Your Portfolio is the Ultimate Insurance

Physical gold might be the best form of insurance you can buy. Since 2011, the strong dollar has been a drag on the U.S. economy, harmed exports & imported deflation from around the world. It’s defeating the Fed’s efforts to create inflation. The US cannot have a strong dollar for much longer, and that ultimately means a higher dollar price of gold – much higher.

In Search for Money that's Good as Gold - What Better than Gold Itself?

Excess debt exerts strong deflationary pressures, and major central banks are now fighting those pressures with such measures as negative interest rates. If inflation wins, as the Fed wishes it to, the dollar may cheapen dramatically & the gold price will shoot up. Wayward monetary policies bring about a search for money that is good as gold. What better than gold itself?

Why Gold Is Winning The Money Competition

We’re now getting into negative interest rates on bank accounts / deposits. These are breaking out around the world & Yellen has talked about the possibility of having them in the US. If gold has zero yield & bank deposits have a negative yield, gold is the high yield asset, zero is greater than negative 40 basis points. So gold is the high yield asset; zero is more than negative.

Gold and the Postponed Stock Market Correction

Is it just me or is the next market correction taking way longer than it should? In other words, have the powers that be figured out how to keep the music playing better than ever? The Fed must have inflation & will do everything possible to create it. Central banks as well as markets have become aware that monetary policy has limitations. And the gold price is sniffing this out.

Gold - It Is The Only Sound Money There Is

Measured in gold, it is the price of the dollar falling that makes sense of what is happening. Gold’s purchasing power is considerably more stable than that of paper currencies over the long term. We do not have to make guesses over gold’s future purchasing power. The future price of gold depends on what happens to the purchasing power of the paper currencies in which it is measured.

Gold In 2016: "The Economic Power Is Shifting"

In the near-term, paper gold is extremely oversold, reflecting the expression of western establishment sentiment in the paper markets. Compared with the situation at the time of the Lehman crisis, gold is significantly cheaper today, which is wholly at odds with the continuing systemic risk to fiat currencies from under-capitalised banks, unprepared for the prospect of markets normalising.

How Inflation Could Be Caused in 15 Minutes

So-called “money printing” is seen as a certain path to inflation. The Fed has printed almost $4 trillion since 2008. Yet inflation (at least as measured by official statistics) is barely noticeable. With so much money around, where’s the inflation? Increased money supply alone does not cause inflation. The money must be borrowed and spent.

An Insight into the Future Price of Gold

Real interest rates are one of the best predictors of the nominal dollar price of gold. When real interest rates are low (or negative), that gives gold a boost. When real interest rates are high, that puts downward pressure on gold. This easily understandable correlation is much stronger than other correlations such as the stock market or economic growth.

Gold’s Price Movement is not a Gold Story. It’s a Dollar Story

If gold went from $1,900 an ounce to $1,100, to me, that’s a 50% increase in the value of a dollar. If gold goes from $1,100 to $1,500, I would think of that as a devaluation of the dollar. What that tells me is the story is really about the dollar. So what’s happening to gold is not unique to just gold. It’s something that is affecting all of the other commodities & currencies.

Will China Decide to "Beggar its Neighbours" and Play The Gold Card?

Will China decide to “beggar its neighbors”, the US and Europe? The only way that the US might counter the Chinese move, would be to revalue gold in Dollars; which is to say, the US would have to effect a corresponding devaluation of the Dollar against gold, to nullify the effect of the Chinese devaluation of the Yuan against gold.

Central Banks and Our Dysfunctional Gold Markets

The love-hate relationship between governments and gold is complicated. It is because gold is a competitive national currency that, if allowed to function in a free market, will determine the value of other currencies, the level of interest rates and the value of government bonds. Hence, central banks fight gold to defend their currencies and their bonds.

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