“Where and when does the gold price stop ascending?”
Chris, who retired two years ago as managing editor and a political columnist of the Journal Inquirer in Manchester, Connecticut, gave me a multiple-part response with his own open-ended questions about gold dynamics and global economics.
“It would seem to depend on a few things,” he says.
“What is the remaining naked short position in gold incurred by the derivatives that were instigated or backstopped by the U.S. government? What would be the monetary and institutional cost of defaulting on them through force majeure?”
He continues, “How much more gold will governments want to acquire to strike a better balance between their fiat and hard assets? There’s speculation that China may be close to what it considers an optimum balance, having acquired thousands of tonnes of unreported gold, but most nations probably wish they had more.”
GATA espouses ownership of physical gold, and not ETFs and other derivative forms of the metal.
“Will retail investors come to understand the difference between real metal and paper gold? If they do come to understand it, they’ll want more of the former and less of the latter.” he says.
— “Will governments, especially in the West, try to interfere with private ownership of gold?”
— “How much do the new gold-centric powers want to weaken the United States and its allies financially and strategically as trading partners?”
— “How much more money creation will governments undertake to inflate away their unsupportable debt?”
“Russia, China and their allies now are large enough forces economically and politically that they can put the gold price and its reciprocal, the dollar, anywhere they want to put them,” he says.
“I’d be surprised if gold wasn’t a lot higher over the next few months and years,” Chris Powell concludes.
Chris Powell writes a political column published in most daily papers and some weeklies in Connecticut, and he is aired on three talk-radio stations in the state.
More about GATA here: https://www.gata.
Thom Calandra is a writer and an investor. Research and material are meant as editorial opinion. He is not a professional investment adviser. Please do not consider his reporting as a recommendation to buy or sell securities.