Debt and Gold

 - If the American people ever allow private bank to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered.

- Thomas Jefferson

Look Around!

We can see the prophecy being fulfilled on our city streets, traffic jams in foodbank parking lots and now, millions of migrants joining their ranks. This is what the cabal at the Federal Reserve and all central banks accomplish. World debt is over $307 trillion. In 2020 world debt was $226 trillion. This averages to over $20 trillion per year. Dear Reader, there are only two nations that has an economy higher than the average and there are only 19 countries with an economy that surpasses $1 trillion. The world's population will be working to pay off debt like indentured servants and possibly, their nation's currency could collapse due to debt. Maybe they should join the meme of ending central banks? Our nation has many ills. The top of the list is the Federal Reserve. We say, "End the Fed!"

Meanwhile...

in the US our debt ceiling forces another political theatre. At the moment our national debt exceeds $34 trillion. If that figure was not scary enough, not mind boggling enough, consider this fact. Our debt total climbs at one trillion every 100 days. We can guarantee you that it will grow by $3 trillion every year. We not only need much higher tariffs on all imports, but we need to tax the wealthy and cut off all their loopholes. We need at least $3 trillion in government revenues just to slow this economic disease. It could become fatal. Even if the idiots in government take up our ideas, the compounded interest on our debt will consume one-half of our budget. See what a central bank causes? Can you hear my cry, "End the Fed!" 

Election Year

In an election year I doubt that this economic tsunami will be answered. Biden buys votes from the young by cancelling student debt. This is a mortal sin unless there is free education for all. He buys Hispanic votes with a no border policy. He will appease any voting block to win again. He spends like he has unlimited funds. He is a disgrace. If Trump is his opponent, he will say anything to get votes with no conviction. We know this from his time in office and his words on 6th January, "We will walk..." except he was not present to lead the protest. He may attack Biden about the debt, but he spent big time in his term. If elected, he will spend just like Biden. He is a disgrace. However, I ponder one question. If the election is rigged like Trump says and if he wins, is he stealing the election? Our nation lacks a true leader with morals, vision and character.

Market Near Term

The market should have a pullback from the recent rally, however all signs point to a strong rally. Election years historically have been good for stocks. The Fed should begin dropping rates in the second half of the year. Together, this will give the Bulls the upper hand in the market unless some unknown changes the picture. One strong positive for gold is the GLD. It hit a new all-time high against all currencies.

Back to Debt

Moody's realizes the danger of our debt. The rating firm just downgraded the outlook for the US from stable to negative. In Europe, Body Works is closing 150 stores in the UK. In Germany, 73 major companies lobbied the EU to protect and offer ideas to make the industrial landscape more competitive. The "Antwerp Declaration" is talking about China and how they attack segments in an economy to dominate. Apparently, China does not worry about debt, but then again, Evergrande comes to mind.  

Jefferson and Gold

After long discussions, the founders came to the conclusion that in order to have a stable currency that fights inflation the only choice was gold. It would also check government spending and reward thrift.  Praise God for their enlightenment. Anyway, fiat rules our system and we can see the results: falling standard of living, inflation and mountains of debt.

Another Choice?

The pushers of Bitcoin say that their coin protects because they will not create more coins. They say it is safe. They say a lot of things. We, at Evolution do not believe in Bitcoin. If it were a currency, they would have to dilute to make coins available for everyone. Safe? If someone buys into it with the intention to break the code, you could lose everything. As for the founders, they are only replacing banks to make the owner of the coin rich like Sam Bankman-Fried. Enough said! We put our faith in Jefferson and Franklin.

Gold Outlook 

The price action in gold is always suspect because it goes against the grain of fiat. On a monthly chart, gold has been in a four year consolidation pattern. The longer a consolidation, the greater the breakout. The question? Which way, up or down? We look to the XAU for clarity. We also point out that even with the Fed imposing higher interest rates, gold has maintained a price at $2000 per ounce. Positive. The XAU had a high in April of 2023 at 165. Last week it was 108. Gold needs to prove itself by surpassing the 165 price level. A strong sign would be if gold could form a new price level at $2100 per ounce. Now, it needs to hold price and make new highs. The other indicator will be the dollar. A drop below 103.5 would provide juice for gold. We like the aspect that gold has reached $2100 level with a strong dollar. This speaks volumes. Any decline in the dollar will act like a V-8 to the price of gold.  Peace.