When the Fed realizes the economy is crumbling, they will pivot, and the only question is…
Tom welcomes Lawrence Lepard back once again to discuss the markets, mining industry, and the fragile state of the economy.
Lawrence discusses the supposed massive discovery of gold in Uganda and why it’s hype and absurd. It would have to be about a hundred times the richest mines in production today.
A high dollar encourages countries to find alternatives. We’re living in a world of monetary chaos and enormous debt structures. ZIRP and NIRP have created enormous financial distortions which are only getting worse. We never imagined that money could get this cheap and markets could get so overvalued. The bubble has found a pin and everything is down twenty plus percent. If they don’t pivot, we’re looking at a major recession or depression because a Ponzi can’t be tapered.
Markets are going to go to zero if Powell maintains his approach. We’ve seen 31 trillion in valuation loss worldwide in equities. We’ve wiped out one and half times total annual U.S. GDP in paper wealth in six months. Gold in comparison is only down six or seven percent over the past year. Gold is hanging in and is likely finding a base for the next leg up.
Gold and Bitcoin are non-state money alternatives. The Fed is trying to make the dollar more sound, and the next act this fall will see another big leg down in equities. Housing will continue to decline as mortgage rates climb. This fall, they will realize the economy is crumbling, and they will pivot. Then we will see gold and Bitcoin will go to the moon. They have to pivot, the only question is when.