• nate@nateplissken.com
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The Gold Super Cycle.

The Gold Super Cycle.

Why is gold poised for an exponential revaluing? The gold super cycle. Why could it be the biggest investment opportunity of our decade? To understand the gold super cycle we are in, you must look at the history of gold, the history of monetary policy, the national debt and inflation.

The Gold Spot Price is artificially suppressed.

On the Comex gold futures can be bought and sold. The short selling of gold commodities influences the spot price of gold. Gold is valued in the United States in dollars. Conversely, the dollar is valued against gold. When the price of gold goes up in dollars, the dollar appears weaker. The Federal Reserve bank and the treasury are motivated to maintain a lower gold spot price.

COMEX is the primary futures and options market for trading metals such as gold, silver, copper, and aluminum. COMEX is an abbreviation of the exchange’s full name: The Commodity Exchange Inc.

Why would anyone invest in something that is artificially suppressed? Nothing can be artificially suppressed forever. Look at a rubber band. You can pull it back but when it releases it re;eases with much force. It may be too late to try to jump on gold the gold bet after it surges.

Gold’s historic rise.

Surprisingly, n the year 2000, gold was priced at $272.64 and this year 2023 gold reached $2135. Gold nearly rose 800% in value, in a little over 2 decades. But that’s nothing! In 1970, gold was priced at $38.90 and ten years later, in 1980, gold reached $594.90! That’s over a 1500% return on investment in ten years.

But the last decade and a half from 2010 to 2024 gold has been relatively flat in comparison. From $1420.25 in 2010 to $2135 in 2023, that’s just 150% growth. We have not yet seen the historic rise of gold like we did from 1970 to 1980.

The US Debt Crisis.

Death by 1000 cuts… The only way the USA can afford to pay the debt is devaluing the currency with inflation. $34 trillion dollars, that’s how much the Nation debt is at the moment. It’s over $102,000 per person in the United States. It’s unsustainable and the interest on the debt has to be paid.

As of January 2024, it costs $357 billion to maintain the debt, which is 17% of the total federal spending in fiscal year 2024.

What happens when it is 25% or 50% or even 100%? The United States will lose the position as the reserve currency of the world.

The $34 trillion gross federal debt equals debt held by the public, plus debt held by federal trust funds and other government accounts. In very basic terms, this can be thought of as debt that the government owes to others, plus debt that it owes to itself. -Peter G Peterson Foundation.

It’s not a democrat or republican problem both parties are equally guilty.

Competition with the dollar.

Richard Nixon may not be your favorite President. But had one of the biggest influence on the history of the U.S. dollar.

The U.S. abandoned the gold standard in 1971 to curb inflation and prevent foreign nations from overburdening the system by redeeming their dollars for gold.

Richard Nixon instigates the petro dollar.

In 1973, the petrodollar system was created through a deal between the US and Saudi Arabia. The countries agreed to price and trade oil in US dollars. With oil standardized in terms of dollars, any country that purchased oil from Saudi Arabia would have to use dollars.

Richard Nixon’s impeachment happened in 1974. But could he have envisioned the crisis that the BRICS alliance could face to the dollar?

The dollar could face a growing challenge from BRICS countries, thanks to the bloc’s growing size and influence over global trade, according to former White House economist Joe Sullivan.

The BRICS alliance includes Russia, as well as Brazil, India, China and South Africa. The bloc met last week and invited oil heavyweights including Saudi Arabia and the UAE — as well as Iran, Ethiopia, Egypt, Argentina — to join the alliance in 2024.

The Dollar Devaluation?

Consequently, if the dollar loses its position as the world’s reserves currency, it will be devalued. Trillions of dollars of purchasing power will be lost overnight. Millions of Americans will become poor overnight. The dollar will be devalued, but by how much and when? The increasing level of debt makes the devaluation of the dollar inevitable. When will the politicians stop increasing deficit spending? No time soon. This is why the devaluation of the dollar is inevitable.

Gold is an asset with no counterparty risk.

Gold is just gold. The US dollar has counter party risk. If the government of the US mismanages its resources, it hurts the value of the dollar. Owning common stocks have counter party risks. A company can devalue their stock prices by bad business practices. Conversely, owning gold is simple. Gold is just gold. It was gold, is gold and always will be gold. It’s the only metal that doesn’t tarnish.

The Revaluing of Gold.

One of the most significant changes in the world of money has been happening by stealth rather than through any policy announcement. Gold has regained a solid yet unofficial role in the world’s monetary system in a barely noticed, gradual process that cannot now be overlooked.

This is the result of several interlinked reasons. The last few years have seen central banks run into gold, accelerated by declining trust in the dollar following western countries’ freezing of $300bn of Russian foreign exchange reserves after the Ukrainian invasion.

The sharp rise in interest rates since the end of 2021 has led to significant losses for worldwide bondholders. This applies not just to commercial banks and asset managers but also, crucially, to many internationally operating central banks that acquired large stocks of government bonds in successive rounds of quantitative easing. This has damaged the validity of government bonds as a core element of central banks’ reserves.

Gold holds its value.

Because, many people look at physical gold not as an investment but as money. It is savings. It holds its value through the ages. Even the most conservative investors recommend that you hold 5-10% of your portfolio in gold. Interestingly, if you hold the 10% rule of investing in gold, you sell gold when it grows much larger than 10% of your portfolio and you buy gold when it drops below 10% of your portfolio.

Invest in Gold Miners for market speculation.

Firstly, you buy physical gold as insurance and savings for the long term. But second if you want to profit from a market speculation standpoint, you invest in gold mining stocks. As much as physical gold holds its value long term, it isn’t an instantly liquid investment. For physical gold, you have to find a buyer for the gold and possibly sell under the spot price to liquidate your physical gold. But gold mining stocks are liquid and historically can yield higher returns that investing in physical gold alone.

Opening a trading account.

If you don’t know how to invest in gold mining companies, you could easily star by opening a WeBull account for just a few dollars.

They will give you free stocks for just funding your account. And you can fund it with just a few hundred dollars.

I invest in currently in:

  1. GOLD, Barrick Gold
  2. KGC, Kinross Gold
  3. GAU, Galliano Gold Inc.

All investments have risk.

Because no matter what your investment strategy, investing involves risk. Looking at the macro-economics, we can see a lot of reasons for a Gold Super Cycle. But nothing is guaranteed. You can have the correct market strategy but mistime the market. So it’s best to do your own diligence. And know your risk tolerance and investment time frame. Are you a long-term investor or a short -term speculator? What if gold was your only lifeline to keep your financial freedom? How free would you be?

Prepare yourself for the coming greater depression.

So there is a perfect storm coming! Will gold be the safe haven? Will the stock market collapse or will it be a melt up? Gold has never been worth zero. My bet for safety is gold. The value of gold has to go up to properly valued. At this point, it’s not the time to haggle over the price you can get gold bullion or buy gold stock, now is the time to buy gold and buy as much as you can. I would say even if you have to buy your gold from acres of gold, that’s still better than having no gold!

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