Inflation Fears Boost Gold

Inflation fears are fueling speculation in gold, alongside the massive boost precious metals just got from Basel III.

Side Note
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Getting beyond the herd divisions of inflationary fears rising and falling, it’s important to understand the nature of the inflation currently haunting investors.

There are several novel initiatives afoot that make the prospect of inflation, unlike any former inflationary periods we’ve ever known.

Recent dollar weakness is no surprise to any hale economists.

What surprises them is that the dollar has maintained its dominion while the Fed has rolled the presses as though nothing previously inhibited that kind of behavior.

Every Banana Republic rolled its presses into becoming a failed state, and it’s testament to the dollar’s unique status and historical strength that it hasn’t suffered far greater loss of value.

Some are vehement that the Fed hasn’t actually “printed” money, rather bought assets with electronic funds it creates and loads into the seller’s bank, which then pays the former owner.

Be that as it may, the liquidity it injects into the marketplace has the same effect.

Legacy mindsets persist for now, and as it has been for the longest time now, sentiment is keeping the dollar stable more than sound economics.

More importantly for investors eyeing gold, are other moves afoot by central banks, as they’re far-reaching and highly unusual.

CBDCs might not just dent fiat, they might eclipse it

Quite apart from conventional inflationary dynamics currently giving markets jitters, central banks are underway with their ideal agenda in the form of central bank digital currencies (CBDC).

In the final analysis, the CBDC model imagines the elimination of fiat in exchange for a private blockchain currency ruled by the central banks.

While there are grave existential repercussions for humanity enshrined in CBDCs, even closer to the surface, they’re not broadly supportive of the dollar, or fiat at all in fact.

Faced with current inflationary cautions and a near-future where the monetary authorities abandon their interest in preserving paper money, gold has never looked this welcoming.

It’s a double whammy-fiat’s masters are abusing it at every turn, and Basel  III just made gold a global currency in a way modern markets have never seen.

The old gold standard made for better sense – it’s an international standard that governs everyone’s financial affairs – and it returns to us now in a different guise, in what is at least an hour of modest need.

Basel  III has mandated its currency, and no smart money imagines that gold’s currency could receive such a massive boost without its value reflecting that.

Beyond any hype, is gold about to increase in value?

Even for legacy gold watchers, and without consideration of any of the unusual and novel inputs possibly impacting gold’s value, now is a good time to buy.

When you do consider the strange forces at work that are polishing gold for all the brightness it can exude, now is a compelling time to buy.

Are there short terms gains to be made in gold?

If ever there was a moment, this is that moment.

Gold has never had such an official endorsement to be seen and handled as decidedly precious.

Are there long-term gains to be gleaned from gold?

Absolutely – it’s a pretty safe bet that anyone who ever invested in gold for the long term came out wealthier, as although subject to sometimes swift and material change, the gold price keeps on climbing with the passage of time.