Hello, my name is Coy Wells and today
we’re gonna be talking with Mr. Patrick Brunson, and we’re gonna be talking about
the gold market. Recently the gold market has been moving in the upward direction,
and we’re now on the verge of breaking $1,300 an ounce, and we’re going to talk
about what we believe the gold market is going to do in the short term, and we’re
going to try to give long-term perspectives on what we could see gold
do here in the very near future. Mr. Brunson, if you’ll kind of give us a
little bit of insight on what the gold markets done in the past few months.
We obviously have seen a massive turn in the stock market, going from around
26,800 points, so we’ve seen it hovering now around 23,000 points.
How is that playing a role in the gold market right now? Well, one of the biggest issues that
we’re seeing right now is the decision by the Federal Reserve to pump
the brakes on raising interest rates. That’s a big deal because
since they’ve made that decision – which was Friday of last week I believe – Jerome
Powell made a statement that they were gonna start to back off a little bit, and
since then, the dollar’s come down on the dollar index. So in turn what that’s done
is that’s sent gold up quite a bit over the last week, and the last 30-45 days.
So we’ve gone from around 1230 at the low and as of yesterday the high was 1295 for the last 30 days, so there’s a lot of movement going on right now and correlation to the government shutdown as well. That’s a significant move.
The other thing that we saw, if I’m not mistaken it was around
December, is that JP Morgan Chase signed a contract with a London-based bank and
they’re now trading around Twenty Four Billion dollars a day in the gold market.
What kind of indication does that give us the American people? Or as a
whole, why would the banks such as JP Morgan Chase, one of the biggest in the
world probably, going out and treating that much money in gold right now?
What’s your thoughts on that? Well, JP Morgan Chase is technically the second biggest bank in the world, and so you’ve had major banks like JP Morgan as well as
Citigroup, Goldman Sachs, more importantly we’ve been seeing the central banks, have
been loading the wagons with physical gold. So they’ve been buying more over the
last three years than they have at any other point in history, since the Great Depression, and they haven’t come out with any
statements as to why. The only assumption that we can truly make for a financial
institution to make that type of a purchase in gold, is because they’re
trying to preserve the value of their own stability as a financial
institution, because if the dollar takes a major hit, and these guys are sitting
on a lot of cash, well, that means they’re gonna take a big
hit too, so they’re protecting themselves. That would also, and you brought up a fantastic point, “that they’re worried about the dollar”, another indicator of
somebody being worried about the dollar is we just saw the inversion curve take
place with US Treasury bonds, which has been an indication for a recession since
about 1975. So that would mean that the confidence has shifted from long-term
Treasury bonds, and it’s gone to short-term Treasury bonds. That means
short-term we’re now exceeding the purchase of long-term Treasury bonds.
That means they don’t have confidence in the US economy or in the US dollar
long term. Would that be accurate? That’d be pretty spot on yeah. I think one of the
biggest issues with bonds right now, is people are starting to realize that they
are basically just a promise to pay back in dollars in the future. So the
problem with that is that if the dollars 30 or 40% weaker ten years from now when
you cash in that bond; what was the point of putting the money into
that bond to begin with? And the other thing that we saw is the International
Monetary Fund had made a report back in October, I think it was October 3rd if
I’m not mistaken, they had made a recent announcement, which was a huge
eye-opener for me, is that she had made an announcement that in a second quarter of
2018, so that’s May, June, and July, that the central banks around the world had
reduced their holdings of US dollars by 38% and change. That’s huge if we think
about that folks, the central banks around the world reduced their
dependency on US dollars by about 38 percent, and now we’re hearing it for Mr.
Brunson that the central banks and our own banks are transferring into gold,
that purchasing gold could have been with the reduction of US dollars at that
time, which was relatively strong. It’s very coincidental, could have been in
correlation to each other. Fantastic information folks, and out
right now, “25 Reasons To Own Gold – 2019”. Fresh off the press, newest addition!
I’m Coy Wells with US Money Reserve “Market Insights” – I’m Patrick Brunson, and if you’re watching from YouTube, please subscribe to the channel, so you don’t miss any episodes in the weeks to come. and as always, thank you for watching.