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according to the statistics published about inflation by John Williams the price of gold here is exactly where it should be and I can say I mean I'm not exaggerating but say I grew up with a gold price of $35 an ounce okay until 1971 the gold price went then to $850 in 1980 and now it is say at 2,600 whatever my view would be that the cost of things and services is up say around 10 times since year 2000 and the gold price is up about 10 times since then a little bit less while the price is currently High many analysts believe that gold's price is far from reaching its peak and some experts predict that it could soon hit $3,000 per ounce or higher if this upward Trend continues buying now even at the current high prices could result in significant profits in the near future renowned investment adviser Mark Faber editor and publisher of the Gloom boom Doom report discusses the new gold bull market he contrasts government inflation figures with John williams' Shadow stats emphasizing that while official data suggests gold is overvalued alternative metrics show it is fairly priced today short-term interest rates as reflected by one-year treasury bills bottomed out at 3.5% in 1971 by 1981 that same interest rate had more than quadrupled Rising as high as 16 % in that same period the price of gold mushroomed from less than $200 an ounce to a previously unimaginable price of nearly $2,000 an ounce gold prices had a strong positive correlation with interest rates rising in concert with them from a technical perspective Mark Faber delves into Gold's historical Cycles noting its undervaluation in the late 1960s and 1998 to 2000 followed by overvaluation in 1980 and 2011 he argues that while gold may seem expensive now it's a reflection of money's collapsing value gold Holdings valued at market prices account for 15% of global reserves consequently the share of the US dollar in total Global reserves including gold would fall to 48.2% instead of 54.8% of global foreign exchange reserves according to Mark Faber the cost of goods and services has increased roughly 10-fold since 2000 with gold prices mirroring this rise he emphasizes that Bank savings are no longer as secure as they once were and suggests gold though not entirely risk-free offers a relatively safer option now we present the clips of Mark farber'n the recent issue of my uh report I discussed two charts one chart was by the bank credit analyst and they calculate the gold price in real terms in other words inflation adjusted but inflation adjusted by the figures published by the Bureau of Labor Statistics in other the government I have been following for the last 30 or 40 years the conference board and also a fellow called John Williams he has a website Shadow stats John Williams is a decent fellow he has no agenda he doesn't belong to the Republicans or the Democrats in his views about the economy he just is a brilliant statistician that takes the figures that lead to cost of living increases as they used to be calculated in before 1981 or 82 in other words the old mythology now according to the bankr analyst what is interesting is gold was very inflation adjusted very depressed in the late 60s before the first big bull market in Gold 1971 to 1980 and then it became again very undervalued in U years in the Years 1998 to 200000 it became overvalued in 1980 inflation adjusted and again in 2011 the last peak of the gold bull market Peak was I think in 1941 or something like this and then again now it's very overvalued in real terms according to the government statistics but according to the statistics published about inflation by John Williams the price of gold here is exactly where it should be and I can say I mean I'm not exaggerating but say I grew up with a gold price of $35 an ounce okay until 19 71 the gold price went then to $850 in 1980 and now it is say at 2,600 whatever my view would be that the cost of things and services is up say around 10 times since year 2000 you know to buy a house and uh to go I don't know out at night and so course I think it's not totally unrealistic and the gold price is up about 10 times since then someone will say gold is very expensive uh in my view that is true it's expensive but it's more a reflection of the value of money that has gone down collapsed and you understand before I could say when I grew up my grandmother and grandparents always told me Mark you have to save money and put the money in a bank on deposit I don't want to bore you with the story of my deposits in the canal Bank of in Switzerland but it wasn't a good investment but the point is at the time money in the bank deposit was safe and nowadays it's not safe that people have to realize what happened in Brazil a few years ago and recently in Cyprus can happen again whereas my gold in my safe and I won't tell you where I keep it in my office or the garden but is it is relatively safe not 100% safe but relatively safe many analysts including Mark Faber discuss the impact of monetary inflation on society he expresses that while some benefit greatly from speculation others suffer as living costs rise faster than wages the US dollar edged lower against the Yen on Thursday after data showed signs of labor market weakness and a higher than expected rise in US inflation in September even though prices were on a downward Trend allowing the Federal Reserve to keep cutting interest rates Labor Department data on Thursday showed that the Consumer Price Index increased 0.2% in September in the 12 months through September the CPI climbed 2.4% the smallest year-on-year rise since February 2021 despite asset markets being at alltime highs Faber predicts that the labor market is likely weaker than official statistics suggest he believes the FED may have cut rates to prevent stocks from falling but warns they can't stop the dollar from depreciating especially against gold and Bitcoin let's get back to the interview I've written about this because it's something that anes me uh and it goes back to essentially the impact of monetary inflation on a society because uh some people benefit from the monetary inflation they become immensely rich and influential and other people they are impoverished because the cost of living is going up more than um their wages and they also suffer because when you can make money I mean big money out of speculating and speculations and speculative activities it drains actually liquidity from productive uh sectors of the economy into the speculative sectors of the economy so some people benefit from the monetary inflation and others suffer the Fed rate cut looked probably at an labor market that is weakening or is far weaker than the Biden Administration statistics would have suggested that I want to point out because the labor statistics are statistics that are published by the government Wall Street and the media then takes these statistics and they don't check about the validity of them and they publish them because they don't want to destroy the inflated asset markets but the labor market is probably quite weak if they looked at the labor market there was maybe a justification for a half a percent cut and I know some experts there are I mean people who are not knowledgeable about the economy they think the FED should have cut even more this is not my view this is where the Distortion of the monetary inflation comes in the labor market is weak but the asset prices are in the sky and to cut the FED fund rate when the Dow and the SNP and the NASDAQ are all and alltime highs and home prices at alltime highs and the Fate knows that the problem of the housing market is affordability according to Goldman Sachs affordability is at the lowest point ever in the US that is a problem but you understand the fed and Wall Street is about one and the same they don't want to destroy the asset markets this is a big concern about once you have inflated asset Market you have to keep juggling them up so they probably cut race to Revenge stocks from going down but what they can't do is prevent the dollar from going down and maybe it won't go down a lot against the Euro and the Yen but what it went down against gold which is an honest currency and it went down against Bitcoins so this is very complex this is very complex issue because if you look just at the labor market maybe 50 basis Co point cut was justified I'm not sure about it but maybe some people argue it was justified but if you look at the asset markets there's a crazy to cut rates when the asset markets are in the sky in general It is believed that the gold market will continue to attract inflows with the US dollar weakening and gold maintaining its strength is now the right time to consider gold as a hedge against further economic uncertaint
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