Gold Setting Up For Huge Spike higher
Financial analyst and money manager Michael Pento says, “I think it is setting up for a huge spike higher. I don’t think the time for that to start is exactly now, but the gold market is catching a bid here. The big boom in gold and gold mining shares will be when we have a watershed moment, when the market realizes in mass the central banks have lost control of the economy and the money supply. That is coming very, very soon, no later than the middle of 2018, and it could probably happen this fall, and that is when the market understands that central banks don’t really control interest rates. They cannot control the long end of the yield curve, and they will destroy economic growth and stock markets across the world. That is the big moment when you want to pile into gold. If you don’t have any gold, you should have at least 10% always. That’s your base level. . . . Hard assets will go through the roof.”
Starting Sept. 7 the ECB may announce an unwinding.
Starting in Sept 20 Janet Ellen may announce quantitative tightening. (The unwinding of Quantitative easing.)
Central Banks have been printing trillions of dollars and that money is used to gamble in the markets.
When central banks remove their thumbs from the scale of the bond markets they will crater and yeilds will soar.
the housing market is down and you start raising the cost of mortgages that will cause the housing market to fall even farther
Treasury says debt is up 31%. All types of debt – the housing market, credit card debt and student debt are all going up and when interest rates rise that causes additional stress.
Multiple hundreds of trillions of dollars of derivatives have been created.
Interest rates will rise when the central banks take their thumb off the scale.
The fall has a myriad of issues and Michael fears the credit markets will be completely shut down. The derivative positions and ETFs purchased on margin might have to be dumped in a panic.
Michael gives some historical examples of what has happened in the past when these conditions have occurred.
Cash levels at institutuons are at a all time low at and margin debt is at an all time high. That should be scary to any potential investor.
ECB taper and reverse QE are setting the markets up for a fall. When the market understands the central banks have lost control of the money supply you will see a crisis in fiat currency.
Michael feels that gold is setting up for a huge spike higher. The huge increase will come when the market as a whole realizes that the central banks have lost control of the economy and money supply. Michael feels that is very soon perhaps the middle of 2018 or even this fall.
Hard assets will be going through the roof and it won’t be bitcoin. Some time in mid 2018 gold will be at an all time high. Right now the fiat currency regime is starting to crater. But you have to be careful.
Inverted yeild curve in China indicates extreme duress.
Disfunction in DC. Trump is drowning in the swamp rather than draining it and it is Trump’s fault. Hope for a massive tax cut was the last lifeline the stock market was clinging to. Michael’s recommendation is to have at a bare minimum 10% of your assets in gold in your possession.
Five reasons to Fear the Fall
Greg Hunter of USA Watchdog interviews Michael Pento of Pento Portfolio Management.