INFLATION PLUS DEFLATION = INTABILITY.

 

There are Relentless Inflationary forces in food, energy, housing, health care and education 

There are Relentless Defaltionary forces in ;iquidity driven  Malinvestment and a societal addiction to debt fueled binging on useless crap with no ultimate resale value.

The inflationary forces in our economy are being driven by Trade War and Populism which has crushed five decades of globalization which kept commodity prices down (Food, Energy, Metals).  Now global supply chains have been destroyed and they will take decades to rebuild. 

That means the end of cheap labor, the end of cheap food (and most goods) and the end of cheap energy.

And five decades of the Fed keeping real rates deeply negative has led to a relentless financialization (Hedge Funds and banks and shadow banks taking Free Money to turn everything necessary to living from housing to education to health care into investment vehicles) that will keep prices so high in these non discretionary areas that even the vast majority of First World Populations can barely afford them.

That means cheap housing, health care and education will never come back.

This will insure that every years the dollars in you bank account will be worth less and less and less.

That is an unstable currency.

Over time that will only benefit the only stable currency: Gold.

On the other hand the Five decades of liquidity fueled Malinvesment in everything from Space Tourism to MetaMasks to Social Networks to Crypto Currencies - none of which have any real Use Value other than to  help people waste time and energy - and develope crushing gambling addictions - are creating a massive Deflationary force as they implode.  The Negative Wealth effect from the loss of purchasing power will be felt for years to come.

Again that creates a deeply unstable economic/societal condition.

Instability can be hedged only by things which have proven their stability over centuries and millienia: Gold and Hard Assets.

Gold is a stable currency.  From the time of Kroisos of Lydia through Alexander the Great, through Julius Caesar through Constantine the Great through to Philip IV and Edward III through to Napoleon and through the First and Second World Wars - Gold was the currency everyone looked to as the one store of value that would get you through tought times.

There are those who think that Financialization is the future and we will never go back to hard currency.  But even many of the greatest advocates of this Brave Fiancialized Future store their own assets in gold and Hard Assets.  The more you understand the instability inherent in Financialization the more attractive Hard Assets become.