Gold keeps climbing to new all time highs when expressed in every fiat currency. Or better yet, fiat currencies are depreciating or devaluing versus gold rapidly. Gold has surpassed the Euro as the second largest reserve at central banks. If you look at the chart below, since the great financial crisis of 2008, and the subsequent monetary stimuli known as QE, central banks have been buying gold consistently. As governments have increased the amount of debt in absolute terms, and in most instances, relative to gdp, the value of fiat currencies has been weakening. If the Fed starts now the easing cycle, the economy falls into recession, and rate cuts are not enough to help the economy recover, we will likely see more monetary and fiscal programs that will further pressure the value of fiat currencies, in particular, the U.S. dollar, which is the anchor for the others since Bretton Woods. To put all this in perspective, the S&P500 expressed in gold terms, has returned basically zero over the last 50 years.
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