A Tsunami of Money (Abbreviated)

It is worth remembering what gold did during the more modest and relatively ineffective stimulus after the 2008 crisis.

tsunami of money

Gold surged from a low of about $560 in 2007 to a high of $1923 by the summer of 2012.  You can see it was more than a threefold move over a 5 year period, then backed down during the recession recovery.

This current cycle started with a low for gold just above $1000 per ounce right at the end of 2015. The excesses of this cycle are far greater than the last one, forecasting an even a larger move for gold than what was experienced after 2008, possibly up to $3,500, as soon as next year.

Governments all over the world have forced their economies into lockdown with few exceptions, and all of them are responding with gargantuan monetary and fiscal actions.  These historically large deficits will have to be financed, likely by central bank monetization.

Get prepared! A tsunami of money is coming!

Information is derived from sources believed reliable but cannot be guaranteed.  Charts courtesy of Stockcharts.com, the Committee for a Responsible Budget, The Manhattan Institute, and the Federal Reserve Bank of St. Louis.

Neland D. Nobel, is a retired portfolio manager and Certified Financial Planner with 45 years of market experience in the securities and gold industry.