GoldSeek Radio Nugget - David Haggith: Gold's Outlook in Economic Uncertainty

David Haggith, head of The Daily Doom joins us on this MLK Holiday in the US, noting that the Fed will balk on rate cuts amid continued inflation fears.

- Technical overview of the Gold market, break-out above $2,000.

I think that where gold could struggle just a little bit is with the dollar because I think the Fed is going to tighten longer than people think – and obviously if the Fed starts loosening then the dollar starts dropping in value and that's going to tend to be good for gold...but overall the situation with the economy is so rough that I think there's plenty of room for gold to keep being strong.

I look at it and I just don't see anything that so many people are seeing. I even see Zero Hedge plugging the Fed pivot constantly and there's absolutely no way the Fed is going to pivot in March and there never has been. I mean this idea has been going around for 18 months now that people keep talking about the Fed pivot like it's going to happen in two or three months, or even a half year – and it's not, there's no way that the Fed's going to. Why would the Fed raise or cut rates in March, what would be the basis for doing that?

He elaborates further:

This is the sticky inflation that we've all been talking about...and I've been telling my readers that you can count on it to come and I said last year, inflation was going to start turning back up last year and it did just marginally but it's up and now we see in the December report for Producer Price Inflation, that's going up and those costs are going to feed into consumer prices eventually.

So, there's no basis for the Fed to turn and say, 'Oh man, we got to start cutting rates in two months'... why? They're claiming that there's no recession in sight, so if they believe what they're saying, why would they cut rates when inflation is stopped? ...and then you look at the situation and the Red Sea and how that's stopped shipment through the Suez Canal, and you look at the situation in the Panama Canal, where drought conditions have seriously curbed how much traffic they can allow through the Panama Canal because there's not enough water to keep the locks filling up fast enough. 

You've got the kinds of slowdowns and shortages forming as things take much longer to route around South America or to route around Africa than what they did take and that's going to tend to have a strong inflationary pressure, too, and it's certainly driving up the cost of shipping of a lot. Shipping is basically doubled on Suez routes depending on where the ultimate destination was and where it was coming from, but in general, it's doubled for oil and for containers...So where is this reason for a rate cut going to come along in March?

- Risks associated with inflation and higher overall energy prices.
- We view the domestic unemployment rate - will the uptick force the Fed's hand to lower rates this year?
- Our guest predicted the precise FFF rate hike level.
- A review of the Fed Funds Futures chart and projected probabilities for 2024.
- Will the Fed follow through with expectations - dropping rates to 3.5%-4%?
- With the S&P near all-time record levels, can the bulls retain control, case in point NVDA?

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