Gold’s Turn to Shine
The comments below are an edited and abridged synopsis of an article by Adam Hamilton
Gold’s turn to shine again is near, with major bullish drivers aligning heading into this new year. The Fed’s deluge of new money remains intact, despite QE tapering, continuing to fuel raging inflation. A new rate-hike cycle to fight that is looming, but gold has thrived during past cycles. This Fed tightening will weigh heavily on QE-levitated bubble-valued stock markets. As they fall, gold investment demand will surge.
Hamilton discusses gold’s journey throughout 2021; the Fed’s epic money printing; inflation; gold as the ultimate inflation hedge; QE reversal through quantitative tightening; the approaching rate hikes; the risks of dangerously high bubble valuations in record-high stock markets; and the biggest beneficiaries of a much higher gold price ahead.
“The bottom line is gold’s turn to shine is coming. This leading alternative asset’s secular bull is set to resume with a vengeance in 2022 and beyond. The Fed is leaving all the many trillions of new dollars it conjured up during QE4 in the economy, where they will continue to bid up prices driving raging inflation. Gold will ultimately rise proportionally to reflect a more-than-doubled money supply, climbing to way-higher prices.”
“Fed-rate-hike cycles are no threat to gold either, as it has averaged strong gains through all dozen during modern times. Rising rates really damage stock markets, where persistent weakness fuels strong gold investment demand. And stock-market downside risks are serious with these bubble valuations driven by all that QE4 money printing. This is a fantastic environment for gold to return to favour as the best portfolio diversifier.”