Why Did Gold Suddenly Stop Tracking CPI?

Hey There Income Hunters,

 

While prepping for my event this Thursday focusing on China finally seizing control of gold, I actually struck some of the yellow stuff myself.

 

This explosive finding validates my thoughts on gold’s involvement in the new monetary system.

 

It also explains why the precious metal diverged from its previous tight correlation to inflation adjusted 10-year yields (i.e. real rates) …

 

You see, the chart below illustrates that during the past couple of CPI releases gold did not track the move in real rates.

 

 

The gold-to-CPI relationship has weakened over the past year…

 

And reason hints at a historical shift that is occurring as the world prepares for a new monetary system.

 

Today, I will show you exactly what’s happening and leave you with an awesome miner that is dirt cheap. (Pun intended!)

 

Gold Takes Its Constitutional Place as Real Money

 

Gold was never meant to be just an inflation hedge.

 

That’s a job for commodities and real estate.

 

Gold is gold.

 

Just the word has tremendous significance.

 

Good as gold.

 

What’s at the end of the rainbow? A pot of … gold.

 

The gold standard.

 

THE GOLDEN RULE.

 

And which currency is the strongest in the world?

 

The one backed by gold.

 

So, as competing central banks sensed the US dollar was losing its reserve currency status, what was the first thing they did? 

 

Why, they started buying gold.

 

Now, that was just the first step.

 

Owning gold is great, but converting it to a national currency takes a bit of work.

 

Nations with such aspirations become the market maker in gold and peg its price to the desired purchasing power of their currency…

 

They control the price to a level that allows them to devalue debt and strengthen their balance sheet.

 

Don’t think it can happen?


Think again! FDR did just this with the Reserve Act of 1934 when he increased the price of gold by 75% while using dollars, instead of gold, to pay national debt.

 

So, as a nation prepares to step up to the plate and take on the responsibility, it’s currency must track gold.

 

And today, China is taking control of gold and pegging it to the Yuan …

 

Check it out…

 

 

Gold Is Officially Trading as a Currency

 

It’s pretty incredible. We are truly witnessing history in the making.

 

Next week’s Basel III deadline will unleash independent physical gold onto the world.

 

No more gold derivative manipulation to suppress the price of physical gold and boost the dollar…

 

Gold will be free to trade and be priced purely on its valuation as real money. It will be used  by central banks to strengthen their own currencies and gain an edge in the global trading arena.

 

Only gold (and silver) provide the four societal functions:

 

      • Medium of exchange
      • Store of value
      • Unit of account
      • Standard of deferred payment.

 

Plus they are fungible, transferable and divisible.

 

Now, doesn’t that put you in a mood to buy a precious metal miner?

 

If so, I have just the one for you …

 

Maverix Metals (Ticker: MMX)

 

MMX is a profitable royalty company with solid growth ahead.

 

It has 13 paying royalties and streams, 16 more on advanced assets (all legit winners) and a further 76 on earlier stage projects. (That’s a good number to be assured some will deliver cash flow in the future.)

 

The royalty business model produces consistent winners, and Maverix is a quality operator. This stock offers excellent upside — and a lot less risk than most.

 

The stock can easily double just on higher gold prices. It could also surprise on the upside…

 

The only risk with a royalty company — lower gold prices — is a risk I am willing to take here.

 

I would put this MMX in the same category with SandStorm Gold (Ticker: SAND) — but MMX is trading at a cheaper valuation.

 

I’m jumping in on this one, and when it doubles, I’ll sell half and take a free ride on the rest.  (Although I’ll use a 10%, 25% or 40% trailing stop to ensure I keep building wealth.)

 

Also, playing it with options, I purchased a Jan 21, 2022 5-/7.5-strike call spread for $.80. 

 

Bring It Home

 

These are historic times and seeing the subtle changes can give you confidence in where the macro winds of change are headed.

 

It will be exciting and present tremendous trading opportunities.

 

I’ll, of course, be here in Power Income every day working hard to sort out the winners and losers for you! 

 

And, once again, don’t forget to join me for my live event tomorrow!

 

Have a great today and as always …

 

Live and Trade With Passion My Friends,

Griff

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