Observation & Opinion


  • Economy & Politics
  • Investing
  • Personal Finance
  • Related Posts

    Hollow Men, Hollow Markets, Hollow World
    It Took A Missing Airliner For Chinese Media To Realize They Were No Good At Reporting
    Hollow Men, Hollow Markets, Hollow World
    A Freak Storm Provides A Possible Preview Of Hong Kong’s Extreme Weather Future
    The Scant Science Behind Anything That Claims To Boost Your Brainpower
    The Solar Panels Of The Future Could Be Grown From Bacteria
    Could The Markets Crash Again?
    When Gods War
    Apps Don’t Bully People, People Bully People
    How The Internet Works, And Why It’s Impossible To Know What Makes Your Netflix Slow
    9 Charts That Tell You Where Life Is Pretty Terrific And Where People Are Miserable
    Investors Downplaying Risk ‘Never Turns Out Well’
    Ignorance Can Be Better Than Bliss
    Lessons From The Financial Crisis 5 Years Later
    Where’s Economics When We Need It?

    Deviation Between Gold And Money Supply Presents Rare Opportunity

    Across the globe, fiat currencies are being printed with wild abandonment as debt-addicted governments try to inflate their economies out of the ongoing crisis. In the United States, the Federal Reserve has tried it all, employing numerous asset-purchasing programs that have yet to spur any sort of meaningful recovery in the "real" economy.

    As reflected in the chart above, the M2 money supply — a broad measure predominately comprised of financial assets held by households — has grown steadily in recent years, increasing by 29.3 percent since the beginning of 2009. Given its reputation as the anti-fiat currency, it should come as no surprise that the gold price closely tracked the increase in the money supply over that time frame. In recent months, however, gold has taken a hit amid rumors that the Federal Reserve would taper its asset-purchasing program sooner than planned.

    In light of this massive divergence, gold appears to have some serious ground to make up, presenting investors with an exceptional opportunity to position themselves in gold’s inevitable resurgence. Like last month’s chart that used official public debt figures, there is no question thatf this trend would be even more pronounced if unofficial expansionary monetary policy schemes such as Operation Twist and European bank bailouts were plugged in to the calculation.

    — Ed D’Agostino

    Ed D'Agostino is the General Manager of Hard Assets Alliance.

    | All posts from Ed D'Agostino

    Discuss this Story:

    Comment Policy: We encourage open discussion. Comments including racist statements, profanity, name calling or spam will be removed at our discretion. We use filters for spam protection. If your comment does not appear it is likely because it violates the policy.

    Homebuilder Confidence Misses For 4th Month In A Row
    Stocks Move Higher On Encouraging Profit Reports
    Here’s How Box Can Still Go Public In The Midst Of The Brutal Tech Selloff
    Stocks That Go Up Can Keep Going Up
    Nestle Reports Slow First Quarter
    China Gold Demand ‘On The Rise’
    Don’t Just Sit On Your Investments, Do Something
    Should Google Know Your Deepest Darkest Secrets?
    How Companies Are Using Wearables In The Workplace
    Is This Tiny Gadget The Future Of Smoking?
    Commodity-Backed Currencies? China Buys Huge Copper Mine; Russia Onshores Largest Gold Miner
    BofAML Warns VIX Complacency Suggest Stocks Fall Further
    Futures Tread Water As Geopolitical Fears Added To Momentum Collapse Concerns
    “Shadows Of March 2000″ – Goldman On The Great Momo Crash Of 2014
    Weekly Sentiment Report: Horrific? Hardly!
    Beta Earthquake
    Gold Jumps To 3-Week Highs, EUR Fades As Tensions Rise In Ukraine
    CME Sued For Giving “High-Frequency Traders Peek At Market” Since 2007
    HFT Purge Begins: SEC Prepares To “Remove” Some High Frequency Trading Firms
    GE Capital Seen Ripe For More Slimming After Credit Card IPO
    Ukraine Tensions Land Fresh Blow On Struggling Stocks
    China Targets Trust Firms In Shadow-bank Crackdown
    Citigroup Cuts 200 To 300 Jobs
    Stocks Face Earnings Blues After Tech Slide
    Europe’s Top Banks Cut 80,000 More Staff In Post-Crisis Overhaul
    Check Out Who’s Investing In Bitcoin Now
    There Is No Biotech Bubble; Here’s The Real Story
    Why You Need To Read Michael Lewis’ New Exposé
    Social Media IPOs 2014: Watch For These Companies To Hit The Market
    As Promised, JPMorgan Delivered An Ugly Set Of Trading Results
    Read more from Investing...

    Liberty Investor Digest

    Get today's most important
    financial headlines all in
    one place by email!



    Sign Up For Liberty Investor Digest™!

    Get Liberty Investor Digest FREE By Email!

    Input your name and email address in the fields below and get today's most important financial headlines sent straight to you inbox!

    Privacy PolicyYou can opt-out at any time. We protect your information like a mother hen. We will not sell or rent your email address to anyone for any reason.