The recent pullback in silver and gold have many wondering what this means, and what may lie ahead for the precious metals market. There are of course many theories out there, but today we discuss a couple. First, could silver and gold be sniffing out the likely oncoming tsunami of bankruptcies and insolvencies? Some argue that if this scenario unfolds, that this will be “deflationary” and thus bad news for silver and gold prices. The Kapital News notes, however, that silver and gold can also do well in a deflationary environment. It must also be stressed that when the mainstream uses the words inflationary and deflationary, they are usually used incorrectly. These are monetary phenomena whereby inflation is an increase in the money supply and conversely deflation is a contraction in the money supply. Well, hello – central banks the world over are printing their respective currencies like they are going out of style – because they are! However, what most people mean by deflation is that prices will drop and inflation – prices will rise. The Kapital News is focused on the goods and services that people actually need and use – not so much the things they do not need and are not spending money on. And with this – prices are going up. In addition, we are seeing financial asset prices make new highs, especially with respect to equities and housing. People around the world are not protesting and rioting because the cost of living is so affordable – on the contrary – the cost of living is unaffordable!
We then look at these recent price declines as perhaps simply a period of consolidation, followed by a sell off, but only to prove to be the start of the next leg higher – bull markets climb a wall of worry. The Kapital News looks at silver and gold as a long-term investment. There are simply too many boxes that are checked or will soon be checked that add fuel to this precious metals bull market. Such as low interest rates, negative rates, negative real rates, massive deficit spending, massive expansion of central bank balance sheets, political and geopolitical risks, a stagnant economy, and a whole host of uncertainties that remain with how countries and societies will handle the wealth and income inequalities, the pandemic, higher prices, elections, and so much more. The remaining decade is going to be one for the history books – what we have done to ourselves and each other, and what we do to ourselves and each other as all of this immoral and unethical behavior, along with trillions in malinvestment(s), comes home to roost. Stay diversified, stay vigilant, and stay with The Kapital News. #Economy #Silver #Gold #Inflation #EndTheFed #BananaRepublic #USA #Liberty #Revolution