RETURN FROM VACATION GOLD AND ECONOMY

We started September back from vacation by superficially analyzing what has happened so far with regard to the gold metal and the economy, for this we highlight the expected flexibility that the Federal Reserve should give when stopping rate hikes for next year. It seems unbelievable that less than a year ago it was practically assuring that a major crisis would come and in the end it seems that they are achieving a soft landing without substantially altering the indices and stock markets.

 

This situation might seem like good news at first, but it really is not and the reason is very simple. Having flooded the economy with liquidity year after year and not allowing there to be a rectification in the markets, it has consequently led to an excess of liquidity ending up in real assets such as real estate, shares and gold itself, among others, thus increasing their valuations, but not at the same speed as citizens' pockets. For this same reason, it is not uncommon to see how most people have already assumed that it is normal to have great difficulties in being able to prosper financially, hoping that this situation will be reversed at some point. The last major economic crisis that occurred was not that of Covid, but 15 years ago in 2008 with the bankruptcy of Lehman Brothers. Since then, growth and global debt have skyrocketed without any brakes, postponing what would seem to be the solution to all our problems.

 

Regarding gold this year, we remember that the first quarter had a rise of 8%, the second quarter the price remained horizontal and this third quarter it has fallen by 3%. At the moment it has only accumulated 5% so far this year with the expectation that it will resume the rise in the remainder of the year and continue with its upward trend.

 

 

A cordial greeting!