Hyperinflation is expected when consumer confidence in the US dollar breaks down, with global confidence already eroded.
The gold price has been rising since September 2023, reaching all-time highs, as countries divest from US treasuries and accumulate gold rapidly.
The US debt crisis is “extraordinarily close” with the government running on fumes and unable to raise dollars that don’t exist.
The gold to silver ratio is expected to narrow during hyperinflation, with gold significantly outperforming silver as the preferred safe haven asset.
Silver price is projected to exceed $50, with its fundamental value estimated at $2,000 per ounce, despite currently trading at $33.
Historically, the gold to silver ratio is high when society is rich and low when poor, with the current high ratio indicating people are acting wealthy.
The futures market in gold is no longer driving prices, with open interest stuck at 450,000 contracts and price spikes not significantly affecting it.
The dollar is considered “dead” by some analysts, with gold and silver viewed as direct forms of money for rebuilding the financial system.
The US government is losing control of the long-term Treasury market, with Trump’s tariffs showing no signs of slowing down.
EU’s push for authoritarian policies, including new banking regulations in Spain, aims to diversify from cash and is part of a broader global trend.
Sound money strategies and community building are recommended to sustain living standards, protect wealth, and prepare for potential economic reset.
The US government’s $2 trillion borrowing this year, coupled with limited investor appetite, is causing weak demand for new US treasuries, as evidenced by the 5.047% yield on the 20-year note in a recent auction.
The Fed’s bond purchases of over $43.6 billion in US treasuries in just four days, including $8.8 billion in 30-year bonds, indicate concerns about avoiding rapid Treasury price reductions.
Ongoing Fed policy of adding treasuries to its portfolio through bond purchases with newly created money will likely contribute to upward pressure on price inflation, potentially extending the 40-year high inflation seen in 2022.
The Fed’s treasury purchases are a key tool in manipulating Treasury prices and yields to benefit the US government, aiming to reduce the impact of interest payments on revenues and prevent diversion of spending from popular programs.
The Trump administration’s lack of interest in cutting spending is driving investor expectations of increased Treasury bond issuance, potentially leading to higher yields and lower prices in future auctions.
The US faces $30 trillion in deficits over the next 10 years, with $3 trillion per year, nearly doubling the national debt and $1.8 trillion in debt interest alone, potentially leading to runaway inflation and crushing government.
Republicans, traditionally the party of fiscal restraint, are now pushing $3 trillion deficits, making them worse than Democrats and leaving no hope for fiscal responsibility.
The collapse in Japanese bonds serves as a warning shot for America, with federal spending jumping from $4.9 trillion in 2019 to nearly $7 trillion in 2021, rates normally seen during world wars.
Bond vigilantes stand ready to deliver double-digit bond yields on a Congress that cannot control itself, potentially leading to a crashing dollar and bond market collapse.
The Federal Reserve and Treasury are likely to resort to printing money to kick the can down the road, inevitably resulting in inflation and a crashing dollar.
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