Gold and silver are down BIG, and the dollar is up in 2018. Right now, it feels as if the floor has fallen out from under the precious metals markets and the “almighty dollar” will continue to reign supreme.
I had an opportunity to address these concerns in a new interview with crypto and precious metals trader and commentator jsnip4. During this interview I went into great detail about the current state of the gold and silver markets, the Fed and the delicate balance of the currency ecosystem – and most importantly, the impending threat to the U.S. dollar and the global economy, which I will summarize for you momentarily.
To begin with, I spoke to jsnip4 about how I view the silver and gold markets. We have to bear in mind that compared to gold, the silver market is relatively tiny. Gold is still a monetary metal to big institutions. Pension funds, hedge funds, etc., still use gold as a hedge against political events, unexpectedly higher inflation, deficits that are getting out of control, or anything that they would want to hedge their portfolios against. This creates a much more liquid market for gold than silver.
Outside of all the industrial uses, the silver market is mostly mom-and-pop investors. For monetary uses, investors tend to buy either a silver ETF or physical silver, but it’s such a small market compared to the much bigger gold market.
The value of the dollar compared to other currencies has increased, and that’s because the Fed has hiked interest rates – something that other developed nations (Japan, Germany, France, etc.) have not done. Hence, for trillions of dollars that need to get parked in short-term Treasuries, they all flock to the U.S. dollar now, thereby increasing the demand for dollars.
At the same time, the Fed is tightening; this is why the dollar is at 52-week highs. Little by little they’re reducing the supply of dollars, driving the dollar price up and the gold price down. Traders are deciding that they don’t need to be in gold right now, and so they sell off their gold trading positions (this doesn’t apply to gold holders with a long-term position). This accounts for why we see paper gold fluctuating so much recently.
At the end of the day, as I explained in my interview with jsnip4, you have to remember why you’re an owner of gold. In fact, you can look at the current situation as a good thing: it’s your opportunity to buy more ounces of gold per dollar. For me personally, I choose to keep two years’ worth of expenses (or what I call my cash “burn rate”) kept in physical gold (80%) and silver (20%); this is stored in a number of vaults worldwide.
[Published on WealthResearchGroup.com 2018-08-22](With two years’ worth of expenses (according to my own “burn rate”) converted into precious metals, I can rest assured that if something happens – a huge event, such as a currency shock – I know that I’ll have enough for my entire family to live on. I believe that the U.S. dollar could suffer a 20%, 30%, or even 40% loss of purchasing power. But not for the commonly suspected reasons: trade wars with China, cryptocurrencies, the national debt, etc., which I don’t view as immediate threats to the dollar.
My research point to an immediate threat to the dollar. I’ve been watching this very closely for over eight years, and there’s a major threat to the U.S. dollar that people aren’t talking about – not the mainstream media, and not even the alternative media are talking about this yet. But if this plays out, I guarantee you that we
will hear a lot about it. It could be an overnight event that changes the paradigm of the dollar.
What you have to keep in mind is that the dollar is a political currency that derives its value from the faith that other countries have in the political system, the U.S. economic system, the ability of the federal government to raise taxes on its citizenry and on corporations if they need to. They can postpone the retirement age, they can eliminate some entitlement programs… There are a number of things that the U.S. government can do to make sure that they pay the interest payments on the national debt, even if the national debt were double what it is today.
That’s why foreign nations invest in Treasuries: they have faith in the U.S. political system and society as a whole, in the stability of the United States to sustain itself as an ongoing system. But this is coming into question right now from a threat that no one is expecting or talking about:
12 U.S. states are in the discussion and planning phases of creating a state-issued currency.
We’re talking about 12 states with their own projects, creating their own coins that will compete with the U.S. dollar. Just California alone, which is the sixth largest economy, issuing their own “Cali-Coin” would be a major event that would shock the monetary system. A Cali-Coin, backed by state projects, would be massive because California has huge reserves of assets they could use to back their currency with – whereas the federal government
does not.
This event, which we call “CaliXit” (similar to Brexit but much bigger), is a huge development that is happening under the surface. When it becomes big news, it will impact the U.S. dollar and it will shift the U.S.’s financial power structure. If it takes place in the next few months, I assure you that it will become one of the
biggest stories of the decade.
All in all, I covered a lot of topics in my interview with jsnip4, which you’ll definitely want to watch all the way through to the end. I feel it is my responsibility to bring this matter to the public as quickly as possible so that citizens and their families can prepare for the coming international economic earthquake that’s likely to take place in the next few months.
Wealth Research Group is on top of this story as it unfolds, and we will be issuing a full report on it very soon, which you can download right here. You’ll learn the entire history of this movement, what’s happening now, and how this can play out going forward. This is a much more immediate threat than the other threats you’re hearing about in the media today, so be sure to download this life-changing exclusive report.
Best Regards,
Lior Gantz
President, WealthResearchGroup.com)