The Search for a Foul-Weather Friend

McAlvany Recap • Feb 13 2023
The Search for a Foul-Weather Friend
MPM Posted on February 13, 2023

Life in these United States—as in much of the world—is getting more expensive. Options are getting fewer. Laws are proliferating. Obedience to the law is deteriorating. Perhaps the true legacy of multiculturalism and postmodern philosophy is that now we all have different ways of doing things. No one agrees on what’s doable, what’s desirable, or how to proceed.

Most Americans would agree that our problems are getting critical. Many solutions are offered, and some have merit. Those that do typically require either large or small groups for implementation. But getting a group to act effectively in concert during a crisis can be difficult (which is not at all to say it shouldn’t be attempted). One thing you can do as an individual is to insure that your assets, your family’s safety, your buying power, and your options are protected by one simple thing: gold.

Gold has successfully played this role for thousands of years. It still does. Central banks worldwide are currently demonstrating very clearly that they never forgot this fact. Many people are, too. So if you don’t like gold, maybe it’s time to fully appreciate and appropriately deal with the fact that it likes you.

Key Takeaways:

  • Central banks all over the world are buying gold
  • Former BoJ official: “It’s hard to overstate the challenge”
  • Oil: demand=way up; supply=way down; future price=oh, my
  • If you like gold—and you should—you have a window

The McAlvany Weekly Commentary: There’s an old saying that, “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.” If that’s true, and the last half clearly is, we’re in trouble. Investors know for sure that the Fed is orchestrating a soft landing. The Fed knows for sure that monetary conditions are much tighter now than when it started raising the fed funds rate. The populace knows that more government control is the solution. The government knows that free people and free markets are the problem. The list goes on (and on), but this is clearly the day of delusion. David and Kevin look at people’s beliefs in buying high and selling low, market “peaks and valleys” that are really just ridges and gullies, central banks believing that gold is a barbarous relic, and much more.

Credit Bubble Bulletin: Around the world in 20 minutes. As usual, Doug covers key developments in important places. This week he covers US markets (of course), Russian escalation of the war in Ukraine, the passing of the baton in the Bank of Japan, Chinese credit and money growth, and much more. Weekly market updates cover all major bourses, bonds, currencies, and commodities. It’s hard to overemphasize how much ground is covered fast and well in these weekly entries. If you read only one news source per week, you would be well advised to make this your go-to.

Hard Asset Insights: Morgan makes quick work of a relatively light week in economic news. Still, there were important indications of health—or its absence—in the US economy that he identifies and puts in perspective. Significantly, the market seems to be recognizing persistent inflation and inverted yield curves, consumer sentiment remains in the basement, and banks are significantly tightening their lending standards and constricting credit availability. Especially important: With credit cards maxed out, savings depleted, and credit no longer available, consumers—who make up 70% of the economy—are decreasing their spending significantly. Is recession coming? Is it here? Be sure to read HAI for the latest economic insights.

Golden Rule Radio: Tory and Robert take the mic this week to look at gold’s recent price action and likely behavior going forward. They consider its recent pullback the prelude to a possible buying opportunity, especially given that spring has in recent years been a strong market for gold. One chart in particular shows this trend in stark and unmistakable terms. The hosts discuss the interests of various actors on the national stage, many of whom would like to see a return to loose monetary policy. And in contrast, they examine the rationale for buying gold at any given time, and the mindset they strive to maintain as they purchase gold for their own portfolios.

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