"When people care more about their causes than the institution, the institution is in jeapordy:" Ray Dalio - What does this mean for Gold?

 

We have reached a point where the Instituion of Democracy is standing in the way of certain political factions acheiving their goals.  The Trumpists on the right that control the Republican Party and the extreme Woke Greens on the left that are on the fringe of the Democratic Party, but do have some increasing role both questions the efficacy of the System.

Unfortunately whereas the Woke Greens want to reform the instituions Trumpists have declared war on the isntitutions.  They seem to believe the instituions are filled with enemies that must by crushed.

These institutions include (but are not limited to) The Justice Department, the Elections Process, the FBI and the CIA, the Fed, and every political party that does not expressly worship Donald Trump.

Now this attack on the instituions that constitute Demcracy is vastly financially destabalizing.  Even if Democracy were replaced with a Authoritarian Police State, the financial instability that would result is absolute.  Because nobody internationally will want to favor the US dollar for their financial contracts.

Thus the dollart would collapse, interest rates would shoot sky high and economic actrivity would grind to a halt.

Now, this scenario does not have to occur.  Yet the trend towards this scenario just has to be considered to be plausible for the economic damage to the US financial system to occur and contracts previoussly written in dollars to begin to be written in Euros, GBP, CHF, Yen, Rubles and Yuan.  This would be enough to send the dollars lower, rates higher in a system already marred by massive debt and persistant inflation,.

We are on the brink.  We live in a system that is under attack from within and evryone in the world can see it.

So why hasn't gold moved yet?

Because the Fed still has firm control over the risk markets.

But as soon as that control comes into question.  And you hear commentators wondering aloud if that is now on the horizon on Bloomberg, and Fox, and CNN and the BBC -  as soon as that happens we will be in the age of GOLD.

Ah, but it will,.