The New Annual Gold Report from Incrementum is Here

We are happy to report that the new In Gold We Trust Report for 2019 has been released today (the download link can be found at the end of this post). Ronnie Stoeferle and Mark Valek of Incrementum and numerous guest authors once again bring you what has become the reference work for anyone interested in the gold market.

 

Gold in the Age of Eroding Trust

 

A chart from the introduction to the 2019 IGWT report: trust in governments is eroding all over the world from what were already extremely low levels. The same applies to the realms of the media and science. Many people are (rightly, we believe) concerned that these once well-respected spheres can no longer be trusted to be neutral. In many cases they have become extremely politicized and are pushing agendas that are opposed by a growing number of people.

 

This year’s report is entitled “Gold in the Age of Eroding Trust” and has been published in German, English and for the first time in Mandarin as well. The extended English version of the report is quite voluminous this year – it has 325 pages. Trust in once well-respected institutions (see chart above) is increasingly eroding. Eventually this erosion of trust is likely to engulf the global monetary order and gold is without a doubt one of the most reliable hedges against such a development.

As always, the report not only contains a wealth of interesting analysis, it is also an extremely useful reference work that can be consulted whenever one needs a statistic or a historical chart relevant to the gold market. To our knowledge it is the most comprehensive  collection of valuable gold-related data that exists.

All aspects of the gold market are discussed, from the political and economic backdrop to technical and sentiment conditions. There are even forays into the realm of philosophy (particularly interesting in this context is the chapter “Acceleration and the Monetary Order”, see the Table of Contents further below).

We are currently at a very interesting juncture – up until now, the so-called “Everything Bubble” (which we also like to refer to as the “Great Bernanke Echo Bubble”, or GBEB for short, naming it after its creator) has proved remarkably resilient. That could be about to change.

 

A giant asset bubble waiting for a pin…

 

The fact that the Fed has tightened its monetary policy  – even though it remains highly accommodative compared to the past – may well be what it takes to stop the enormous asset price inflation of recent years dead in its tracks. Year-on-year growth in the US broad true money supply TMS-2 has recently declined to a new 12-year low of 2%, which is well below the level we believe is needed to keep asset price inflation going without a hitch.

 

Say hello to the pin – the Fed’s reversal of “QE”.

 

Gold has been neglected in recent years, as market participants have become increasingly convinced that they won’t need a portfolio hedge – a decision that some may come to regret. It is actually quite remarkable how well the gold price has held up in the face of the relentless rise in risk asset prices.

Evidently there exists fairly strong underlying demand for gold despite the fact that  the macroeconomic fundamentals driving gold prices were for quite some time at best in neutral and often even in slightly bearish mode (in recent months they have shifted to a somewhat more bullish configuration, but in our opinion it is not yet what we would consider unequivocally bullish).

We suspect many investors remain uneasy about the current economic situation and the risks posed by the vast increase in outstanding debt and the monetary policy experiments of today’s central bankers. Obviously gold’s short term performance – particularly in USD terms – is disappointing for investors in the sector, as neither gold nor gold stocks seem to be able to go anywhere.

One should keep in mind though that the longer a consolidation period lasts, the bigger the eventual move is likely to be. With regard to gold’s ability to serve as a hedge: it is always better to have insurance and not need it, than to find out one day that one needs it but doesn’t have it.

 

IGWT 2019 – Table of Contents

To give you a quick overview of what to expect from the 2019 IGWT report, here is the Table of Contents:

 

  • Introduction     4
  • The Status Quo of Gold     20
  • Gold and the Dragon – China Stabilizes Its Ascent with Gold     70
  • De-Dollarization: Europe Joins the Party     101
  • Highlights: 20 Years Later – a Freegold Project: Interview with “FOFOA”    122
  • The Enduring Relevance of Exter’s Pyramid     130
  • Portfolio Characteristics: Gold as Equity Diversifier in Recessions     143
  • Gold Storage: Fact Checking Liechtenstein, Switzerland, and Singapore     166
  • History Does (not) Repeat Itself – Plaza Accord 2.0?     176
  • Acceleration and the Monetary Order     193
  • The Crumbling Trust in Politics and Its Economic Root Cause     209
  • Hyperinflation: Much Talked About, Little Understood     223
  • Gold Bonds: Bringing Back an Extinguisher of Debt to the Bond Market     231
  • Gold vs. Bitcoin vs. Stablecoins     242
  • Gold and Bitcoin: Stronger Together?     254
  • Gold Mining Stocks – After the Creative Destruction, a Bull Market?     263
  • Reform, Returns, and Responsibility     275
  • ESG: Environment, Social, Governance –three words worth more than USD 20 trillion?     285
  • Gold Mining: Disruptive Innovation at Its Core     301
  • Technical Analysis     314
  • Quo Vadis, Aurum?     326

 

And here is the download link to the 2019 IGWT Report – enjoy!

In Gold We Trust 2019 – Gold in the Age of Eroding Trust (PDF)

 

Charts by Incrementum, OECD/World Gallup Poll, St. Louis Fed, Bloomberg

 

 

 

Emigrate While You Can... Learn More

 


 

 
 

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

   
 

Your comment:

You must be logged in to post a comment.

Most read in the last 20 days:

  • Sovereign Bonds – Stretched to the Limit
    Anti-Vigilantes We dimly remember when Japanese government debt traded at a negative yield to maturity for the very first time. This happened at some point in the late 1990s or early 2000ds in secondary market trading (it was probably a shorter maturity than the 10-year JGB) and was considered quite a curiosity. If memory serves, it happened on just one brief occasion and it was widely held at the time that the absurd situation of a bond buyer accepting a certain loss if the bonds were...
  • Writing on the Wall
    Not Adding Up One of the more disagreeable discrepancies of American life in the 21st century is the world according to Washington’s economic bureaus and the world as it actually is.  In short, things don’t add up.  What’s more, the propaganda is so far off the mark, it is downright insulting.   Coming down from the mountain with the latest data tablet... [PT]   The Bureau of Labor Statistics (BLS) reports an unemployment rate of just 3.7 percent.  The BLS also...
  • Global Stock Markets: Danger Lies Directly Ahead
      A Global Pattern You are no doubt aware of the saying “sell in May and go away”. It is one of the best-known and oldest stock market truisms.   Mark Twain's famous saying about stock market speculation (the other one was “There are two times in a man's life when he should not speculate – when he cannot afford it, and when he can”).  From a seasonal perspective he was definitely right about September and October. [PT]   The saying is in fact justified...
  • Bond Yields in the Netherworld - Precious Metals Supply and Demand
      A Record Amount of Bonds with Negative Yields to Maturity Last week the price of gold went up $22, while the price of silver dropped ¢17. The big news last week was that the yield on all German government bond maturities is now negative. They are also all negative in Switzerland. And in Denmark, all maturities out to 20 years are negative. Interest rates are dropping rapidly in the US as well.   More than $14 trillion in bonds now trade at negative yields to maturity –...
  • Rising Stock Market Volatility – Another Warning Sign
      Bad Hair Days Are Back We recently discussed the many divergences between major US indexes, which led us to expect that a downturn in the stock market was close (see The Calm Before the Storm for details). Here is an update of the comparison chart we showed at the time:   The divergences between various indexes seem to be resolving as expected.   The next chart shows analogous divergences between the S&P 500 Index and two major foreign stock markets:   US...
  • Retail Holders Sell Their Gold - Precious Metals Supply and Demand
      A Myriad of Reasons to Buy Gold – But Small Holders are Selling Big moves occurred in the prices of the metals last week, with that of gold up $57 and silver $0.77. We have now reached a price of gold (if not silver) not seen since 2013, when it was on the way down. What is causing this sudden spike in price and renewed interest in gold?   A well-known depiction of investor emotions over a complete market cycle. Interestingly, it appears as though many retail gold holders...
  • Bitcoin – From Greed to Fear
      A Noteworthy Sentiment Change Bitcoin and other cryptocurrencies have declined quite sharply in recent days. Here is an overnight snapshot of the daily chart:   Bitcoin corrects again...   It is difficult to gauge sentiment on BTC objectively, but there is a service that tries to do just that. According to its greed & fear barometer, the recent decline seems to have triggered quite a bit of apprehension:   The BTC sentiment measure of alternative.me has...
  • Getting to a Special State of Ugly
    Suspicious Phrases There are certain phrases – like “trust me” or “I got this” – that should immediately provoke one’s suspicion.  When your slippery contractor tells you, “trust me, your kitchen renovation will be done before Christmas,” you should be wary.  There is no way it will be done before late spring.   USD-CNH (offshore yuan) exchange rate – the support/resistance level at 7 finally breaks amid escalating trade war rhetoric. [PT]   Or...
  • Interest Rate Watch and Bond Market Curiosities
    Things To Keep An Eye On Below is an overview of important US interest rates and yield curve spreads. In view of the sharp increase in stock market volatility, yields on government debt have continued to decline in a hurry. However, the flat to inverted yield curve has not yet begun to steep – which usually happens shortly before recessions and the associated bear markets begin.   2-year note yield, 3-month t-bill yield, 10-year note yield, 10-year/2-year yield spread,...
  • Tumbling Interest Rates - Precious Metals Supply and Demand
      An Era of Low Time Preference Last week the price of gold moved up another $16, and the price of silver was up $0.14.   10-year treasury note yield since 1999 – it is almost back at the multi-decade low of 2016. The only other time in history when US treasury yields were this low was in 1944-1945, when the Fed was actively suppressing yields in order to provide cheap financing for the war effort. One year later (from mid 1946 to mid 1947) the CPI jumped to more than 17%...
  • A Bubble in Complacency - Incrementum Advisory Board Discussion
      Incrementum Advisory Board Meeting of 31 July 2019 At the end of July the Advisory Board of the Incrementum Fund held its quarterly meeting (a full transcript is available for download at the end of this post). The board was joined by special guest Simon Mikhailovich, a financial market veteran who inter alia co-founded the Toqueville Bullion Reserve. The title of the transcript and this post was inspired by his remarks.   Special guest Simon Mikhailovich   We...

Support Acting Man

Austrian Theory and Investment

j9TJzzN

The Review Insider

Archive

Dog Blow

THE GOLD CARTEL: Government Intervention on Gold, the Mega Bubble in Paper and What This Means for Your Future

Realtime Charts

 

Gold in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Gold in EUR:

[Most Recent Quotes from www.kitco.com]

 


 

Silver in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Platinum in USD:

[Most Recent Quotes from www.kitco.com]

 


 

USD - Index:

[Most Recent USD from www.kitco.com]

 

Mish Talk

 
Buy Silver Now!
 
Buy Gold Now!