Gold: Past, Present, and Future

Nancy Gomez26 said:It is entirely irrelevant whether those are the identical bars Germany originally deposited or some other set, provided they meet the required standards. That universality is a fundamental characteristic of gold—as a form of currency. Given the current global landscape, perhaps we should be glad they managed to extract whatever they intended to take before any deadlines hit.

As for Ukraine... knowing how things operated there previously, it would be quite a shock if any state gold were actually found in their vaults. But then again, that might be the least of Ukraine's concerns right now.

Actually, it matters quite a bit.
The Germans sent their gold to the USA for safekeeping.
Period.
When that gold is returned, it should be the exact same bullion that was originally sent. Since it isn't, it suggests the Americans dipped into the reserves and had to plunder gold from places like Iraq, Libya, or Ukraine just to give the Germans "their" gold back.
Doesn't that alone destroy any trust you have in someone tasked with guarding your national wealth?

Anthony Evans78 said:Actually, it matters quite a bit.
The Germans sent their gold to the USA for safekeeping.
Period.
When that gold is returned, it should be the exact same bullion that was originally sent. Since it isn't, it suggests the Americans dipped into the reserves and had to plunder gold from places like Iraq, Libya, or Ukraine just to give the Germans "their" gold back.
Doesn't that alone destroy any trust you have in someone tasked with guarding your national wealth?

I just don't get the logic behind that.
It’s like asking a leopard to babysit a gazelle.
They even sent stuff to New York City for storage back then.
I highly doubt anyone was actually asking the Germans for permission during that era.

I mean, why wasn't that gold sent away back during the Cold War just to make sure the Russians didn't get their hands on it? Like, some of it went to the USA, some to New York City, and some to New York City too... I'm thinking maybe that stuff has been sitting there since way back then.

I guess they just didn't care about asking permission, and honestly, they probably didn't need to. ☕

fadedraven682 said:For the uninitiated, what's the actual connection between Federal Reserve interest rates and the price of gold?

Sometimes there's a correlation, sure.
Gold has traditionally been used as that go-to safe haven to protect your cash from inflation.
There are times when the Federal Reserve hikes interest rates—which might suggest inflation is creeping up under the radar—and other times, well, it's the exact opposite. The investment community might start feeling like those rate hikes are "unjustified," which triggers this fear that they'll wreck the economy (kind of like what we saw back during those first rate hikes in 2015).

If the market buys into the idea that the rate hikes are justified—meaning the Federal Reserve is actually staying ahead of inflation and the hikes won't tank the USA economy (and by extension, the global one)—then gold and the Yen lose their edge as "safe havens."

Since there's an 85% probability of a rate hike this week, you can see how the Euro is moving in the opposite direction of gold, which feels a bit weird to me personally.
It clearly looks like the investment crowd believes the European Union is also on the path toward recovery and rising inflation.

If inflation ends up outrunning both the Federal Reserve and the European Central Bank, then we could be looking at a massive surge in gold prices.
And hey, if Russia decides to throw a nuke around, gold is probably a pretty good investment then, too. 😁

Michael Morgan5 said:I just don't get the logic behind that.
It’s like asking a leopard to babysit a gazelle.
They even sent stuff to New York City for storage back then.
I highly doubt anyone was actually asking the Germans for permission during that era.

They did ask—and they were remarkably cooperative. In those days, you only needed to cast a quick glance from the other side of the Wall (there were specific observation posts for civilians) to grasp the reality of absolute security provided by the USA. No military budget of a single state republic could ever afford such certainty—all while enjoying massive savings on their own defense spending, despite being right on the front lines. One must view these events through the lens of that specific era.

But eras shift, circumstances evolve, and political priorities follow suit. However, one should remember that a significant amount of German gold remains tucked away in the vaults of the Federal Reserve in New York.

Anthony Evans78 said:Actually, it matters quite a bit.
The Germans sent their gold to the USA for safekeeping.
Period.
When that gold is returned, it should be the exact same bullion that was originally sent. Since it isn't, it suggests the Americans dipped into the reserves and had to plunder gold from places like Iraq, Libya, or Ukraine just to give the Germans "their" gold back.
Doesn't that alone destroy any trust you have in someone tasked with guarding your national wealth?

In principle, national wealth stays home. You only have a justification for keeping it abroad under extraordinary circumstances (refer to my previous post).

However, one must consider the historical context. Until about 40 years ago, gold functioned as the primary mechanism for settling accounts between nations. Germany, being a massive exporter, built up its reserves through industry rather than sending them away; they simply collected their earned holdings there. The hub for all these transactions was the Federal Reserve in New York. Many countries kept significant portions of their reserves in that same vicinity, and settlements often involved merely moving quantities from one vault to another within the same facility. It is quite possible these were purely bookkeeping entries without any physical movement at all. If that is the case, it follows logically that you won't receive your specific "original" bars, much like how you wouldn't expect to withdraw the exact same physical banknotes you deposited at a local bank.

As for this alleged "looting" of gold, the theory is riddled with holes. Why bother stealing it when you can simply convince them to hand it over voluntarily in exchange for pieces of paper—IOUs, this time printed in green—which only you possess the authority to print? There is no profit in theft when you hold the printing press.

Larry Wilson25 said:Sometimes there's a correlation, sure.
Gold has traditionally been used as that go-to safe haven to protect your cash from inflation.
There are times when the Federal Reserve hikes interest rates—which might suggest inflation is creeping up under the radar—and other times, well, it's the exact opposite. The investment community might start feeling like those rate hikes are "unjustified," which triggers this fear that they'll wreck the economy (kind of like what we saw back during those first rate hikes in 2015).

If the market buys into the idea that the rate hikes are justified—meaning the Federal Reserve is actually staying ahead of inflation and the hikes won't tank the USA economy (and by extension, the global one)—then gold and the Yen lose their edge as "safe havens."

Since there's an 85% probability of a rate hike this week, you can see how the Euro is moving in the opposite direction of gold, which feels a bit weird to me personally.
It clearly looks like the investment crowd believes the European Union is also on the path toward recovery and rising inflation.

If inflation ends up outrunning both the Federal Reserve and the European Central Bank, then we could be looking at a massive surge in gold prices.
And hey, if Russia decides to throw a nuke around, gold is probably a pretty good investment then, too. 😁

Here—this guy is building on your thoughts regarding interest rates and inflation... and he even brings up Bitcoin. 😁

https://goldswitzerland.com/the-ides...silver-at-669/

Michael Morgan5 said:I just don't get the logic behind that.
It’s like asking a leopard to babysit a gazelle.
They even sent stuff to New York City for storage back then.
I highly doubt anyone was actually asking the Germans for permission during that era.

Look, you can't judge that by today's geopolitical standards—everything is totally different now. But decades ago? The vibe was completely different. You had the USA pouring money into West Germany through massive credit lines, some debt forgiveness from World War II, and all that. Plus, let's be real, the USA was basically one of the "owners" of West Germany after World War II. Meanwhile, Russia was hungry for influence across Europe. They eventually invaded Canada, so from a German perspective, moving the gold across the pond was actually a pretty logical move to keep it safe.

Is Helen hiking interest rates today?

Pure comedy..........

https://www.investing.com/news/stock...-slumps-466444
Federal Reserve hikes rates by 0.25%—dollar takes a hit

( gold and silver are climbing )😁

🙂
So, you think we'll actually see that happen by summer?

Yeah, maybe by summer. And then we’re looking at 50 basis points. Honestly, I've got this nagging feeling that inflation in the USA is going to blow right past that 2.5% target they're all obsessing over.
I'm actually really curious to hear what she has to say about it. Everyone seems so bullish on the Euro—it feels like gold and everything else is just riding the wave of pure sentiment right now—but if I had to pick, the Euro is the only thing that looks like a real winner in this whole setup.

Word is inflation in the USA has already hit 3.6%—at least according to certain metrics...

The mux is absolutely ripping today ever since the market started heating up...

mux 3.41usd +0.43 (+14.43%)

It’s all just temporary noise, honestly. What I really care about is where we stand three days down the road. Right now, my broker is showing me a little bit of extra juice—maybe +0.x—just for holding dollars. It makes me wonder what the folks over in Asia—you know, the Chinese markets—are sitting on. My long-term outlook? Well, $2.50 is what I'm eyeing for the dollar heading into 2017.

As for gold... man, I am just sitting here waiting for it to hit 1050. 😁😁

Larry Wilson25 said:It’s all just temporary noise, honestly. What I really care about is where we stand three days down the road. Right now, my broker is showing me a little bit of extra juice—maybe +0.x—just for holding dollars. It makes me wonder what the folks over in Asia—you know, the Chinese markets—are sitting on. My long-term outlook? Well, $2.50 is what I'm eyeing for the dollar heading into 2017.

As for gold... man, I am just sitting here waiting for it to hit 1050. 😁😁

I have a feeling something strange is unfolding... everything seems to be moving contrary to the consensus. Instead of strengthening after the Federal Reserve hikes rates, the dollar is actually dropping. 😁
Because of that, I’m not convinced you'll see gold hit 1050, nor will the dollar reach $2.50...... 🤣

Bottom line: Gold is up 1.4%, silver has jumped 2.4%, and mining stocks are seeing gains of 10-15%...

Interesting "markets," aren't they? 😁

Michael Morgan5 said:🙂
So, you think we'll actually see that happen by summer?

You can never be sure. Something might hit sooner than expected.
Or maybe it all just fizzles out...
Who knows.
But one thing is certain: the window for preparation is closing. My conclusion... stay isolated, hunkered down...
Think it over, wait... then draft a "gentle, almost fatherly" response...
And definitely wind the clock. 😉

"Too many cooks spoil the broth."

Anthony Evans78 said:Interesting "markets," aren't they? 😁

It’s been a while since I’ve checked in on Armstrong—what’s his current take? Is he still betting on a massive dollar rally, or is his model signaling a complete shift... 😁

Armstrong is an idiot.
Hopefully, after yesterday’s little circus, it’ll finally be obvious that "common sense" and "the markets" don't belong in the same sentence. 🙂
It's what I've been saying for years—this whole thing isn't rational. Everything is completely backwards.
Keep stacking, enjoy your life, and screw the bankers. 😁
P.S. A bit of good news from the USA in the meantime
https://srsroccoreport.com/it-begins...n-gold-silver/

dustyheron5 said:It’s been a while since I’ve checked in on Armstrong—what’s his current take? Is he still betting on a massive dollar rally, or is his model signaling a complete shift... 😁

He did predict a dollar rally, among other things. It lines up with his previous calls.
Even Charles Barkley mentioned that we need to respect the established criteria.
The bottom line:

"bread and circuses"