Market mayhem ahead
Complacency over events in the Middle East is staggering. But rising gold and bond yields are now chipping away at this delusion. Slowly, then rapidly reality returns.
The chart of major currencies valued in gold shows them plunging at an accelerating pace, despite the six-month correction since January. The pace of their collapse is now resuming and if it continues, they will approximately halve by December. That implies a gold price exceeding $9,000. Not a forecast, just an extrapolation.
This article looks at the factors that might lead to this outcome; an outcome which implies a continuing collapse of major currencies’ purchasing powers which is unlikely to stop at a halving. Inevitably, it will lead to long bond yields rising rapidly which will destroy government finances and the fiat currency illusion.
The potential for bond yields to rise is clearly demonstrated in our next chart:
