Gold is headed to new all-time highs.
March 31 (King World News) – Fred Hickey: The great gold bull market of the 1970s featured rising inflation & rapidly rising interest rates – but negative real rates – just like today. The 10-yr. Treasury/gold “correlation” that hedge funds & algos are playing (before that they were correlating with yen & yuan) will end too.
Keep (govt.) spending at unprecedented rates (no limits), keep running up massive debts, keep printing trillions upon trillions of dollars and the dollar will be destroyed, the country will be destroyed and (unfortunately) that will be great for gold – wherever the 10-yr. may be…
To learn which company billionaire Eric Sprott bought a
$10 million stake in click here or on the image below
Currently looking at a chart from this A.M.’s GCRU newsletter. A 54 year chart (1967-2021) comparing gold to real T-bill yields. Shows that during great gold bull mkt decades of 1970s & 2000s it didn’t matter if negative rates became less negative due to rising rates. Gold rose.
Didn’t even matter if “real” rates went slightly positive. As long as they were low, gold still rose. For example, from the summer of 1977 to early 1980 gold skyrocketed as the fed funds rate was lifted from 4.75% to 15%. It was only when Volcker raised to 20% did gold break.
Fed raised fed funds rate from 1% in June 2004 to 5 1/4% in June 2006. Gold soared from under $400 an ounce to over $700 during that period (real rates stayed below 3-4%). History does not confirm the current algo/hedge fund- “real rate rise” gold selloff story.
For those wondering about a 10-yr Treasury rise. 10-yr. soared from around 7.75% in summer of 1976 to 10.4% at the end of 1979. Gold went from $100 to $500 (up 5X) during that period. 10-yr Treasury yields also rose during June 2004-June 2006 period. Gold nearly doubled in price.
To listen to one of Egon von Greyerz’s best interviews CLICK HERE OR ON THE IMAGE BELOW.
To listen to Alasdair Macleod in the KWN Weekly Metals Wrap CLICK HERE OR ON THE IMAGE BELOW.
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