The drastic increase in debt defaults show that rate hikes are starting to bite. The “free money” measures during COVID-19 seem to have delayed, not solved, the problem.
The Fed is headed for an annual operating loss for the first time in 108 years. They will soon be forced to print the money to cover their expenses. A conundrum, indeed!
The U.S. stock market surges higher as investors refuse to look at alternatives, even as the government risks defaulting on its debt and jeopardizing the U.S. dollar.
The price of gold has tracked the rapid expansion of money supply throughout history, both in the United States and globally. As M2 continues its long-term parabolic growth, so will gold.
Bullish stock market sentiment and unexpected U.S. Dollar strength are putting pressure on gold, while increased volatility in the equities and bond markets support safe haven demand for the yellow metal.