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the reason gold is tanking today and yesterday is rate hikes possibly on the horizon:
Just that dynamic alone is probably the most important thing to consider in the next five years. You know they could raise rates but still lag inflation and so have no real effect and this is very likely to happen. We have a large political influence so any raising of rates is quite certain to lag behind actual increases in monetary base. There is so many factors pointing towards this and we have like a sleepy dead head reaction to the quite apparent danger. Raising of rates effects government very badly, it increases the deficit. Then USA has the lowest turnover time of its debt in the world, it has the largest amount to deal on every occasion also. Yet it lacks the figures to support such a large debt overhang.
So the influence on rates from this is massive and obviously going to lead to interest rates not being a reason for gold to go down. I know thats the perception and I wont argue thats not the reason gold fell recently or any other time. But at some point the real momentum in the situation is a lack of currency integrity on multiple fronts, dollar will be weaker then gold and thats why its a buy. I wouldnt invest or hold for other reasons or speculative.
Similar reasoning could have been applied to the housing debt 10 years back maybe. Renting was cheaper then buying, even if capital appreciation was real for housing owners the underlying efficency supported the case for selling that asset. So at that point housing debt vs dollar (or gold or whatever currency base you prefer) was weaker outlook. Ag
