Hold Gold as Governments Have ‘Scandalously Mistreated’ Their Currencies—Byron King
The comments below are an edited and abridged synopsis of an article by Neils Christensen
The gold market remains trapped in consolidation; still, one analyst said that the precious metal’s long-term bullish setup remains firmly in place.
Byron King, precious metals expert at Agora Financial, said that it’s only a matter of time before gold once again becomes an essential monetary metal.
King said that inflation is rising out of control, consumers are losing faith in fiat currencies, and that the situation can still get worse as governments continue to create money out of thin air.
Also, the issues consumers currently face can be traced back to the 2008 financial crisis. Nearly 15 years ago, the government and the Fed flooded financial markets with money and liquidity that helped support the economy during the worst financial crisis since the Great Depression.
With rising inflation and slower growth, the world is once again on the brink of recession. King said that the only solution politicians have to spend more money.
And it’s not just consumers who are starting to mistrust the US dollar. The shifting geopolitical landscape, due to Russia’s invasion of Ukraine, has some nations questioning the dollar’s role as the world’s reserve currency.
The US government and its allies have weaponized the dollar against Russia and have imposed strict sanctions; however, King noted that these could backfire and continue to affect global supply chains and drive inflation higher.
King expects nations, particularly those that are friendly to Russia, to start reducing their exposure to the dollar and Treasuries and increase their gold holdings.
Despite the growing challenges, the dollar has held up well. However, King said this is less about the strength of the US economy and more about the weakness of other nations, like Europe.
