The 10th Anniversary Edition of the “In Gold We Trust” Report

As every year at the end of June, our good friends Ronald Stoeferle and Mark Valek, the managers of the Incrementum funds, have released the In Gold We Trust report, one of the most comprehensive and most widely read gold reports in the world. The report can be downloaded further below.

 

Gold, dailyGold, daily, over the past year – click to enlarge.

 

The report celebrates its 10th anniversary this year. As always, a wide variety of gold-related topics is discussed, providing readers with a wealth of valuable and intellectually stimulating information. This year’s report inter alia includes a detailed discussion of gold’s properties in terms of Nicholas Nassim Taleb’s “fragility/ robustness/ anti-fragility” matrix, as well as close look at the last resort of mad-cap central planners that goes by the moniker “helicopter money”.

Since falling to a new multi-year low amid growing despondency and a crescendo of bearishness late last year,  gold has celebrated a rather noteworthy comeback. As our regular readers know, we pointed to many subtle signs that indicated to us that a trend change might soon be afoot as the low approached (particularly in gold stocks, see e.g. “Gold and Gold Stocks, it Gets Even More Interesting” or “The Canary in the Gold Mine” for some color on this).

Ronald and Mark are inter alia looking into the question whether gold’s recent comeback marks the resumption of the secular bull market, and which factors are likely to drive precious metals in coming years. As they correctly argue, the increasing desperation of central bankers and their willingness to boost inflation at all cost is going to lead to a plethora of unintended consequences, all of which are likely to boost the gold price.

They also shed light on one issue that  – apart from a handful of exceptions –  is clearly not on anyone’s radar screen at the moment: namely the possibility that central banks might finally “succeed”. In other words, the possibility that gold’s recent rise is actually the harbinger of another event widely regarded as “impossible” – the return of price inflation.

In this context, we want to reproduce a chart from the report, which shows the proprietary Incrementum inflation signal vs. the gold price and a number of other inflation-sensitive assets. As can be seen, the signal has flipped rather forcefully toward inflation, after having been stuck for several years in “disinflation/ deflation” territory.

 

Incrementum signalThe Incrementum Inflation Signal vs. inflation-sensitive assets – click to enlarge.

 

This incidentally jibes with the ECRI Future Inflation Gauge, which has recently reached a new multi-year high as well. As can probably be imagined, if the message of these signals is actually borne out, central banks will be facing quite a quandary. It also has potentially far-reaching implications for investors of all stripes, which the report discusses extensively as well.

 

Conclusion and Download Link

We are certain that our readers will find this year’s In Gold We Trust report just as interesting and entertaining as its predecessors. In fact, we believe the anniversary report is an especially well done issue. Enjoy!

 

The Report can be downloaded here (pdf): In Gold We Trust, 2016

 

Charts by: BarChart, Incrementum AG

 

 

 

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Dear Readers!

You may have noticed that our so-called “semiannual” funding drive, which started sometime in the summer if memory serves, has seamlessly segued into the winter. In fact, the year is almost over! We assure you this is not merely evidence of our chutzpa; rather, it is indicative of the fact that ad income still needs to be supplemented in order to support upkeep of the site. Naturally, the traditional benefits that can be spontaneously triggered by donations to this site remain operative regardless of the season - ranging from a boost to general well-being/happiness (inter alia featuring improved sleep & appetite), children including you in their songs, up to the likely allotment of privileges in the afterlife, etc., etc., but the Christmas season is probably an especially propitious time to cross our palms with silver. A special thank you to all readers who have already chipped in, your generosity is greatly appreciated. Regardless of that, we are honored by everybody's readership and hope we have managed to add a little value to your life.

   

Bitcoin address: 12vB2LeWQNjWh59tyfWw23ySqJ9kTfJifA

   
 

One Response to “In Gold We Trust, 2016”

  • Bam_Man:

    We will eventually have high inflation, with interest rates that barely budge above zero.
    That is the signal that the seemingly over-valued stock market is sending us. All the debt on those highly-leveraged balance sheets will either be “inflated away”, or rolled over at interest rates that are steeply negative in real terms.
    Of course, your savings in the bank or a Money Market Mutual Fund will meet the same cruel fate.
    Not a bad scenario, to say the least, for Gold, Silver and other hard assets such as real estate.

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