LIVE Gold Prices $  | E-Mail Subscriptions | Update GoldSeek | GoldSeek Radio 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page >> News >> Story  Disclaimer 
Latest Headlines

COT Gold, Silver and US Dollar Index Report - May 29, 2020

The Comex Has Big Problems
By: Dave Kranzler

Scammers Exploit Pandemic to Peddle Fake Silver, Phony Collectibles
By: Mike Gleason

Silver Miners’ Q1’20 Fundamentals
By: Adam Hamilton

The Dollars And Deaths Of COVID-19
By: Bill Sardi

Fibonacci Queen and Elliott Wave King Market Proclamation
By: Avi Gilburt

Asian Metals Market Update: May-29-2020
By: Chintan Karnani, Insignia Consultants

Silver and Gold: Balancing More Than 100 Years Of Debt Abuse
By: Hubert Moolman

Precious Metals Update Video: Market cycling money out of tech, Gold is acting very good
By: Ira Epstein

HOUSTON WE HAVE A PROBLEM: Dow Jones Index Totally Disconnects From The Employment Data
By: Steve St. Angelo, SRSrocco Report


GoldSeek Web

Time to buy gold and silver as central bank data finally shows inflation is coming

 -- Published: Thursday, 11 June 2015 | Print  | Disqus 

By Peter Cooper

It is time to buy gold and silver again as new central bank data shows that the European Central Bank and Federal Reserve have finally been successful in creating inflation. Whether they will now be able to control it is completely another matter, and buying gold to hedge against the very real possibility that they lose control is going to be the next big thing.

Oxford Economics has assembled data that shows ‘narrow’ M1 money in the eurozone expanding at the phenomenal rate of an annualized 16.2 per cent for the past six months. The wider measure of the money supply M3 is growing by the fastest rate since 2008, up 8.4 per cent in the same period.

US money supply

The Federal Reserve has quadrupled its balance sheet since the global financial crisis, pulling and pulling on a piece of string that never seemed to break. Now the brick on the end of that string may be about to fly into its face as M3 growth has returned to post-war averages, up around eight per cent so far in 2015.

Inflation is coming, like the cavalry coming over the hill in battles of yesteryear. Only its appearance in the nick of time can save the world from its debt mountains and a downward deflationary debt spiral. Anybody might think the central banks have been planning this all along, and yes that’s the obvious truth, except that it just did not seem to be happening.

Thank Mario Draghi at the European Central Bank for leading the charge with quantitative easing in the eurozone that has finally put the cat among the pigeons. Inflation is now coming home to roost.

Not for the first time global financial markets have been wrong footed. The bond bubble has bust as markets adjust to the new inflationary forces now in their midst. Bond yields are surging back around the world and any bondholders who bought at the end of the bubble are now deep underwater.

Bond crash coming

The bond rout is not over yet. Chair Janet Yellen has yet to sing. When the Fed does actually raise its key discount rate then bond markets will sell-off again. If historical precedent is anything to go by then stocks will not escape either: equities generally dislike inflation as input costs rise faster than they can be passed on in higher prices, and so profits suffer.

The asset classes that do gain from inflation are usually commodities and precious metals. Remember how oil and gold prices surged in the 1970s as inflation took off. That’s good news for the oil rich Middle East and precious metal investors but not many others.

HSBC says it is going to fire up to 50,000 staff in the near future and that maybe nothing compared to the scythe that will cut through the bloated global financial sector as this unwinds. Those on Wall Street pumping up bank stocks on higher interest rates really have gotten the wrong end of the stick.

No the bond rout ought to be a reminder just how wrong consensus opinion can be in financial markets and how the contrarians usually win in the end.

| Digg This Article
 -- Published: Thursday, 11 June 2015 | E-Mail  | Print  | Source:

comments powered by Disqus


Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to >> Story

E-mail Page  | Print  | Disclaimer 

© 1995 - 2019 Supports

©, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


The views contained here may not represent the views of, Gold Seek LLC, its affiliates or advertisers., Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of, Gold Seek LLC, is strictly prohibited. In no event shall, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.