Gold – Five things investors need to know

Gold – Five things investors need to know

Edison’s Shades of the 1970s report is the latest in our series of reports on gold. It provides an in-depth analysis of gold price trends and forecasts. Here are five key takeaways from the report:

  1. Rising interest rates have set the stage for another 1970s-style gold bull run. Just like back in 1979, real rates turning decisively positive in May 2023 indicates significant volatility ahead.
  2. Historical data show gold prices rebased much higher after real rates went from negative to positive in the Seventies. On past precedent, we could see prices realistically over $3,000/oz and, potentially, as high as $4,500/oz.
  3. The extended 2004–23 crisis has uncanny similarities with 1971–81. This suggests substantial latent inflation in the US economy that could further boost gold.
  4. While expensive relative to CPI, gold is actually correctly priced based on the total US monetary base. This points to future dollar devaluation and inflation pick-up.
  5. Multiple statistical analyses predict a new gold price range of $1,900–$2,900/oz this decade, which is 15–50% above prior forecasts.

In summary, political and economic parallels with the tempestuous 1970s foreshadow another dynamic gold bull run, with prices likely rebasing even higher amid latent inflation and significant currency devaluation.

To read the full report click here.

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