We’ve noted many similarities between today and the tumultuous 1968-1980 period.
The biggest similarity is the rise of inflation. While inflation has broken below the 1970s trend, ongoing deficit spending may compel policymakers to let inflation run hot.
That may be why central bankers are also taking a cue from the era of polyester and disco – and are loading up on gold in their balance sheets. Their total gold holdings are now back to a 1970s level:
Notably, central bank gold holdings didn’t bottom around the year 2000 when gold prices did – they bottomed right around that pesky Great Financial Crisis.
And since then, central bankers have been taking the same steady buying approach to gold that retail investors take with their 401(k)s.
As central bankers rediscover gold, we can’t help but note that the metal is still undervalued relative to the fiat money supply – and would need to rise to over $20,000 per ounce to be fairly valued.
While retail investors chase paper assets, the central bankers may be onto the right trend for a change – and it’s a trend still worth following by adding your own gold and gold stock holdings.
~ Addison
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P.S.: With the hard asset story getting stronger as time goes by, so is our research. Andrew’s planning to attend the Rule Investment Symposium in Boca Raton on July 7-11, 2025.
The Symposium is a five-day affair featuring in-depth research from dozens of small-cap resource companies, including gold and silver mining companies – but also copper, uranium, and other critical commodities we’ve explored in-depth in our research over the past year. Click here to attend and meet your future cutting-edge resource investments face-to-face.
As always, your reader feedback is welcome: feedback@greyswanfraternity.
