Fall 2024 Gold Report: The FED Surrenders to Inflation 💵

Federal Reserve Begins Cutting Interest Rates.

October 2024

The central bank cut interest rates by a whopping 50 basis points in September, the first reduction since 2020 and the biggest in 16 years. It’s just the fourth time ever that an easing cycle has begun with a 50-point cut. All the others were during severe economic crises.

Fed chairman Powell in his press conference, stressed that the economy remains “healthy.”

But cutting rates will reignite inflation and a rapid sell-off in the dollar

So, why such a huge rate cut?

The Fed has painted itself into a corner. It’s under enormous pressure from Washington & Wall Street to cut interest rates and reinflate the economy.

The Fed cuts interest rates because it expects economic conditions will worsen drastically in the near future and it wants to preemptively soften the blow, knowing it can’t prevent a recession altogether.

So, it shouldn’t be too shocking that recessions begin after the Fed cuts rates.

High interest rates have already put the economy into recession territory. 811,000 new jobs created in 2024 reported by the government didn’t exist, and were ‘adjusted’ last month from the official numbers.

Fake News: According to the Labor Department, employers added 254,000 jobs in September, much more than had been forecasted.

President Joe Biden joined Federal Reserve Chairman Jerome Powell in taking a victory lap for the supposedly strong economy.

Among those unimpressed by the latest official data is Senator Marco Rubio (R-FL). “Another fake jobs report out from Biden-Harris government today,” he posted to social media. “16 of the last 17 reports have been significantly revised downwards after media helps them with their fake headlines.”

In fact, the last 2 times the Fed started an easing cycle with a half-percent rate cut, it was a prelude to a crisis.

In January 2001, the Fed cut from 6.5% to 6%. Over the next year, the S&P 500 crashed by 39% and unemployment skyrocketed, leading into a recession.

In September 2007, the Fed cut rates from 5.25 to 4.75%. A year later, we had the financial crisis and the Great Recession when stocks crashed 70%.

In addition, the servicing cost on the $35 trillion National debt has just tipped the scales at $1.2 Trillion & if the FED didn’t get rates lower soon, the bond servicing costs were going to be too big to pay, even Larger than Social Security costs. Already the debt interest is larger than the entire U.S. defense budget at over $900 billion.

Plus, $200 Trillion in unfunded liabilities, will cripple the economy and erode the currency in the future. “America’s debt is a time bomb. The mini-crash in the stock markets at the start of August was a warning shot.” – Switzerland’s Minister of Finance, Keller- Sutter.

Since the U.S. government continues deficit spending, the FED had no other choice, but as the #1 Aden Forecast says, to ‘inflate or die’…

“There are only 4 ways to eliminate debt: It can be forgiven, paid off, default, or if you are a government, you can debase the currency the debt is denominated in until it is virtually worthless.”

In fact, the U.S. debt skyrocketed the very first day of the new fiscal year, jumping $204 billion in a single day to a new record of $35.669 trillion — reflecting ongoing fiscal challenges neither presidential candidate mentions, let alone has an answer for.

As long as Washington keeps spending money that it doesn’t have, inflation is going to get worse.

The government reports ‘Official’ U.S. inflation is up 70% from 2000 to 2024 according to the fake CPI. Yet according to the original 1970’s formula, that includes food, energy and housing costs. The average annual inflation rate from 2000 to 2021 was 9%, resulting in a price increase of over 600%!

While gold is up 679% to suggest that inflation isn’t the problem, it’s the result of deficit spending. It’s monetary and debt growth that spawned a huge everything bubble. U.S. federal debt is up 644%

Considering the above, it should be no surprise that gold has been rising in lockstep with the rise of U.S. debt and the so called debt limit by viewing this.

Fake Gains: Investors who bought the S&P 500 at the beginning of the year are sitting on nominal gains of more than 20% – a very good performance by historical standards.

That performance looks far less impressive when measured in terms of real money in the form of gold and silver. In fact, the S&P 500 is down over 6% versus gold in 2024.

It has fallen over 10% when measured against silver, which rose to a multi-year high last week. And is at the same level today as it was in 1971 when the US went off the gold standard.

Billionaire stock investor & Wharton Business school professor Jeremy Grantham, is one of the few economists who correctly predicted the 2008 Financial crisis warns, “Stocks are absurdly expensive and artificial intelligence is a bubble destined to burst. The economy will suffer a recession or worse.”

Fake Money: Today’s fiat Federal Reserve notes fail to meet the Founding Fathers’ original definition of a “dollar” that was linked specifically to gold & silver. The money itself is fake. Rising precious metals prices reflect the ongoing debasement of the currency.

Soaring inflation & costs of living are straining American budgets, especially when it comes to housing.

In many states, the median monthly housing payment has nearly doubled in the last 4 years, according to Redfin.

A record number of Americans is facing the prospect of paying 50% or more of their income on rent or mortgage payments.

Unsurprisingly, actual housing costs aren’t reflected in the Consumer Price Index. The phony CPI instead employs statistical models such as “owner’s equivalent rent” to arrive at a number that is far removed from reality. Including food, energy and housing costs real inflation is well over 9%. Triple the ‘official’ CPI rate.

Irresponsible government spending has created the price inflation Americans continue to struggle with, and it has bankrupted the United States.

In fact, America has gone from the world’s largest creditor, to world’s largest debtor. That’s why central banks are replacing their U.S. dollar reserves with physical gold.

Gold- The New Global Reserve Asset.

The U.S. Treasury market has been losing its share as a primary global reserve asset since 2014. Global central banks have sold $400 billion worth of Treasuries and bought $600 billion worth of gold.

Bank of America reports that gold has overtaken the euro to become the world’s second-largest central bank reserve asset.

With the central bank gold buying spree over the last several years, along with the rapid rise in price in 2024, the monetary metal now makes up16% of total reserve assets, just ahead of the euro.

The dollar’s share of reserves has dropped to 58%. There’s a growing movement to replace fiat currencies, including the dollar, with gold, especially in emerging market countries in the East & BRIC’S nations.

Right now retirement funds are facing new critical threats from unrelenting inflation and political turmoil, with U.S. elections only weeks away…

Billionaire investor John Paulson to ‘go into cash and gold’ if Harris becomes President – Kitco News.

“If Harris is elected, I would pull my money from the market,” said billionaire hedge fund manager John Paulson during a Tuesday appearance on Fox Business. “I’d go into cash, and I’d go into gold because I think the uncertainty regarding the plans they outlined would create a lot of uncertainty and lower markets,” Paulson added.

Gold price to surge to $10k under Harris administration – Peter Schiff | Kitco News.

“If Harris is elected the debt will increase exponentially … We’ll be at $40 trillion of total national debt during her first term. She is going to try to blame all the problems that the government created on capitalism and use that as an excuse to implement socialist policies.”

The waning power of the U.S. dollar as the world’s reserve currency would be one of the drivers behind a $10,000 gold price. “It is difficult to see the dollar surviving as the global reserve currency through a single term of the Harris administration.”

The Federal Reserve chairman was appointed by the current Administration. So the rate cut is just what Democrats wanted, hoping it artificially inflates the economy enough for people to give them credit when they head to the voting booths in November.

But if Trump wins, during his first term Gold prices gained between 40% – 50%. Silver prices rose from the $17 range in November 2016 to over $24/oz by election day in 2020. Gold went from under $1,300/oz to more than $1,900/oz.

President Trump is a strong believer in the constitution & has said returning to the gold standard is a ‘wonderful idea.’

Of course, gold would have to be revalued at multiples higher of its current price. Which may be the only way to prevent hyperinflation, if U.S. government deficit spending continues at it’s current pace.

In fact, renowned economist & best selling author Jim Rickards, known for his accurate predictions of the 2008 Great Recession, Trump’s 2016 Election win & the Covid Crisis of 2020. Predicted that gold prices would exceed $27,000, which was an update from his previous prediction of $15,000 in 2026. Gold could be used to re-establish the gold standard in the event of a global currency meltdown.

“The U.S. M1 money supply is $17.9 trillion and assumed that maintaining confidence would require a 40% gold backing. This percentage was the legal requirement for the U.S. Federal Reserve from 1913 to 1946.” According to the World Gold Council, the U.S. has 8,133 tonnes of gold reserves, or 261.5 million troy ounces. And that leads Rickards to the final step of his calculation.

“Applying the $7.2 trillion valuation to 261.5 million troy ounces yields a gold price of $27,533 per ounce,” he wrote.

Gold surges After Historic Rate Cut – And So Will Inflation.

In the wake of the Fed’s huge 50 bps interest rate cut, the dollar responded immediately by dropping against gold. With more rate cuts on the way, Israel’s war expanding rapidly, and inflation ready to surge higher, new record prices are on the way for the gold.

Gold to rise 4-fold
Renowned Economist and best-selling author James Turk explains, “Gold is currently undervalued, which is indispensable information given gold’s exceptional appreciation. When viewed in terms of U.S. dollars, gold remains cheap. This conclusion is illustrated in the following chart.

With the Fear Index at only 2.89%, gold is being valued in dollar terms by the market near historic lows, just like it was before other major economic, banking, and financial crises over the past 100 years. Given the fragility of today’s monetary system, I anticipate that rising fear will once again send gold and the Fear Index soaring, as it has done many times throughout monetary history.”

Gold Rush Begins! Gold just began its most significant breakout in 50 years. In the past 12 months, gold is up about 43% going from $1,865/oz to $2,675/oz

In fact, the #1 financial advisory in the world expects gold prices to triple, “During the inflationary 1970’s bull market, gold soared 2,300%. And in the 2001 to 2011 bull market, gold surged 646%. Assuming the current bull market rise is similar, it means that gold could rise to as high as the $6,780 to $24,140 level.” – Aden Forecast.

Overvalued Equity markets and a monetary system overcome with indebtedness is not a safe place to entrust your financial future.

It is dangerous to own risk assets such as stocks at artificially inflated valuations. It is especially hazardous to own false safe havens such as bonds, when their yields are so low that they are guaranteed to deliver negative real returns. (inflation)

Repositioning IRA/401K retirement-savings out of risk assets (stocks/ bonds) and dollar denominated accounts (money market/CD’s) into gold now, could be the most important financial decision you make.

Gold safeguards your money from stock market declines, global economic crisis, financial bubbles and currency devaluation (inflation)

Unlike a currency it can’t be hyperinflated away. Unlike a bond it can’t default. And unlike a company (stock) it can’t go bankrupt.

In a world of rising global debt and uncertainty, gold remains a reliable constant in an unpredictable marketplace. Gold’s track record as a long-term store of value makes it irreplaceable in any diversified portfolio.

Gold offers unparalleled profit potential, a proven track record of appreciation, privacy and wealth preservation. It’s the perfect way to protect your money against inflation and overpriced stock market.

King Solomon, the wisest and wealthiest man who ever lived said, “Wise people see trouble coming and take precautions. Those who don’t, suffer the consequences.”

Benjamin Franklin said, “By failing to prepare, you are preparing to fail.”

No matter who wins the elections, the financial winner will be gold. Because, the purchasing power the U.S. Dollar will continue to plunge, causing prices for montetary metals to soar to unprecedented levels.

Make sure you’re prepared, protected and prosper with the only secured asset that cannot be debased by governments, who print paper money at will, making their currency worth less every day. Secure your IRA/401k retirement- savings with physical gold & silver. A money that has no default risk and cannot be inflated away.

U.S. gold & silver coins have been a popular method of storing wealth for generations, which is no surprise considering that they have outperformed the S&P 500 for the past 25 years. (PCGS 3000 Index) And appreciate at an average rate of 23% in years where inflation is at least 3%.

The Last Cheap Gold Asset.. Historic gains are coming for classic American gold coins leveraged to the price of bullion. “U.S. gold coins can & have soared ten-fold during previous bull markets. The last two bull markets saw coin prices rise 665% and $1,095%” (PCGS 3000 Index) In fact, many U.S. gold coins have traded at 3 to 5 times current values, giving investors who act quickly an opportunity make 500% gains as premiums revert from record lows,” – True Wealth.

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