By the time Powell realizes the recent increases in inflation are not “transitory,” we could all be back in a world of hurt because inflation will keep rising for a while even after the Fed realizes it needs to tighten again.
Moriarty notes surprising discrepancies between market sentiment and price movements and predicts a sustained rally in gold and significant gains in gold shares over the next 6-7 months.
Many believed that the Fed would have reduced interest rates to where US Treasuries would not be devalued. Nothing has changed, nor is anything about to change anytime soon.
The Fed managed to plug one hole in the dam with this bailout program. But with the Bank Term Funding Program (BTFP) a thing of the past, we could start to see more leaks and cracks.
The fact that shrinkflation only occurs when Federal Reserve policies cause major price inflation should show anyone willing to think logically about these issues that the Fed, not greedy businesses, causes shrinkflation.
Bubble mania in bonds is breaking due to returning inflation. Bubble baloney in stocks stinks past its sell-by date. Two articles today ask if the outrageous stock bubble is getting ready to implode.
People buy gold primarily for the opposite reason the media says: they are skeptical that any political figure can be fully trusted to do “what is true and right.”
With geopolitical uncertainties, nations like China and Russia are stockpiling gold, not merely as an investment, but as a hedge against political risks.
Gold’s performance may not perfectly match inflation in any given year. But over the very long run, the precious metal can be counted on to retain its purchasing power.
