One Bank Warns Buying Gold Is The Only Hedge Left for The ‘Great Debasement’

The comments below are an edited and abridged synopsis of an article by Tyler Durden

Bank of America says two themes explain the current market: the Great Repression and the Great Debasement, and both  are explored in this article.

One Bank Warns Buying Gold Is The Only Hedge Left for The ‘Great Debasement’ | BullionBuzz
Dollars swirl 3d abstract illustration.

Debasement of the US dollar is well underway as the default narrative for the US economy, with excess debt, insufficient growth, and maxed-out monetary and fiscal stimulus. However, local currency debasement is also underway everywhere else, so the next market crisis will lead to an even bigger spike in the dollar as global monetary authorities are faced with an even bigger global synthetic short squeeze than the one that sent the dollar soaring to all-time highs in March.

This is why shorting the dollar to hedge debasement may be profitable in the short term, but will eventually lead to catastrophic consequences.

That leaves gold as the only natural hedge to the central bank all-in bet of kicking the can until something breaks. That something will likely be gold exploding higher ($2,000, then $2,500, then $3,000), at which point the Fed’s control over fiat currencies, as well as the illusion that there is no inflation, and the financial regime will collapse.

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