in the USA inflation rages upwards to record high levels. This week’s +8.6% consumer price inflation data point is not only underreporting price escalation facts of real-world costs rising like food for example, but it is already at a level America has not seen since the last time #Gold bullion manically revalued upwards to a spot price so large at the time, the USA could have gone back on a quasi-gold standard had it chosen.
Inflation Rages Upwards
Hopium – (n) an irrational or unwarranted optimism that things might change sooner rather than later (in this case, regarding raging price inflation escalations). Janet Yellen is correct with that statement about price inflation raging globally. Seemingly all fiat currencies are increasingly losing value versus goods, services, and items of real value worldwide. Instead of burying our heads in the sand, we’ll look hard at some data and charts to better understand where things are and where they may be going. Price escalations for basic things like food to eat in your home, gasoline to get to work, and travel have exploded in the last year and a half. Even if this chart went back into the 1970s, I doubt we would see price escalations of this size in basic food staples and fuel cost rises. I can make this statement rather confidently because we have US consumer sentiment data that goes back to 1952. We’ve never been this low before. Gallup poll data also illustrates that US consumer, who drives about 70% of the nation’s economic output, are extremely concerned about escalating price inflation. Generally, most US workers’ wages are not keeping up with inflation. And we can see that effect with a plummeting personal savings rate. As well as ramping credit card debts in a seemingly desperate attempt to make up for household budget gaps and making ends meet.
Silver American Eagle (BU)
If recession is not here yet, it can’t be too far from around the corner. We might want to stop listening to those who have historically proven themselves to be both inaccurate and misleading, especially in lifelong proclamations. The silver and gold markets closed this week’s trading somewhat strongly, particularly in gold. The gold silver ratio thus climbed to 85. And while the silver spot price continues languishing in the low $20s spot per ounce price consolidation, the most encouraging move this week was gold’s response to this latest price inflation data ramp. Perhaps early next week we’ll see some follow-through and a run towards $1,900 oz. In a secular bullion bull market, when nearing a potential mania phase revaluation price climb higher. Studied bullion bulls typically want to see gold lead, and only later enjoy the typical outperformance the silver price contributes, as average investors swarm into physical precious stores of value.
Paul Revere Half Oz Silver Rounds
The next major move for the monetary precious metals is likely when large institutional investors and momentum swing traders finally return to the precious metals markets, from leverage derivatives to major increases in physical bullion demand to come. Central banks around the world are not waiting, and recently one in four or 25% surveyed stated they plan to increase their official gold reserves in 2022. That is up from only 8% in a somewhat recent 2019 survey. In my longer-term view, each week that passes we move closer to an era where global precious metals price discovery markets get called into real question, in large public forums for trillions upon trillions of wealth transferring reasons. For most of the world, by that time, it will be too late to secure bullion in large size at any price premiums reasonably close to spot delivered within reasonable timeframes. I strongly suggest you get prudently positioned outright with bullion in hand and potentially also with proven dependable counterparties you can trust to help secure your foundational precious metals wealth along the way. From here to there, things are only likely to become more unprecedented and volatile in nature.
