If Russia Accepts Gold for Oil, Silver Quintuples

Zoltan Pozsar, Head of Short-Term Interest Rate Strategy at Credit Suisse, is at it again with his monetary musings. This time, he says that Russia may respond to a $60 price cap on its oil by only accepting payment in gold. Read if for yourself here: https://plus2.credit-suisse.com/short… Doing that would double the gold price almost overnight, he says, and he’s probably right. By implication, it would also quadruple-to-quintuple the silver price. But why would Putin offer a discount for oil if paid in gold?

To answer that question, just answer this one first: In dollars vs gold, which is the money, and which the substitute? You know what else oil for gold would do, says Pozsar? It would squeeze out all the gold and silver shorts in the futures markets. “Banks have been managing their paper gold [and silver] books with one assumption, which is that states would ensure gold wouldn’t come back as a settlement medium.”

With the worries of CPI data and Powell speaking this week metals have been seeing much higher volume than usual. SLV has been trading 17.1 million shares on average over the last 20 days. Which we expect volume should remain high with economic uncertainties. Mainstream media is now talking about a recession which we have been speaking on here for the last couple months. It appears undeniable at this point. If Russia accepts Gold for oil, it could make things really interesting in the metal market. I believe investors and traders would be more likely to move to metals (if they haven’t already) could also cause FOMO (fear of missing out).

Disclaimer:

we are not financial advisors, nor do we claim to be. Investing and trading can result in the loss of your entire investment. Our articles are opinion only based on our research.