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 Invest and earn up to $2,000 in bonus silver at golds.com. It's easy. Step one, open any golds storage account excluding IRA. Step two, purchase your precious metals. Step three, get up to $2,000 in bonus silver dropped straight into your vault. Visit golds.com/free silver to claim your silver. Hi everyone, it's Mike Maloney and Alan Hibbert once again with the Gold Silver Show. Let's get into it. >> Yes, exactly. So, I know a lot of people are getting interested in gold these

days and I thought what we could do is go through the in gold we trust report put out by Incrementum and look at a handful of the charts that really summarize what is going on in the gold market these days and what is sort of the main thesis for why someone would want to buy it. Okay, before you get started, I just want to point out that you said a lot of people are getting interested in gold these days. A few on in the west are getting interested. Mostly it's coming from the east and I believe you're probably going to present

some information in here that will end up proving that. >> So, yeah, we'll see. Yeah, I guess it's all relative, right? So, let let's get into it. Um, this is the in gold we trust report. uh they publish a long one that's over 400 pages and a short one that's like 40 pages. And in this video, we're going to condense it even further down to like five or six charts that sort of summarize the main thesis. >> Okay. >> So, if anyone wants to read this, it is

free online. >> Yeah. >> So, yeah. So, the first chart here, gold in US dollars and new all-time high closes going back to 1970. So, this is the price of gold and all the blue dots here are all-time highs. And you can really see the shape of bull markets. They tend to go vertical and get steeper and steeper and steeper as you go. All those dots start to pile up. >> And yeah. >> So yeah, what what do you see in this chart here, Mike? >> Uh one of the things I see, you know, at

first glance, you're saying, okay, uh this 2020's bull market is only 76 all-time highs. So basically, compared to 209 of the 70s, we're just getting started. However, I do want to point out that they split uh today's bull market into two uh sets of all-time highs where they have grouped the 70s bull market into just one set. Uh so you'd have to take the 106 add 76 and 106 together. But uh uh still it it doesn't matter. Um, the global economy is in a lot more trouble than it was back in the bull

markets of the 70s. And gold being a monetary asset, it's really when monetary demand hits and we haven't had it yet. We've got fear of missing out, which is completely different. That's greed driven, not fear driven. And uh and we've got uh some people getting prepared because they see something dangerous in the road ahead. Uh but not that many. So as a percentage of the population, not that many. Not enough people own gold yet for this to be anywhere near being over with. Exactly.

And for anyone who doesn't know, at the very end of this bull market in the 70s, the price of gold doubled in 42 days. So it went real vertical right at the end in 42 days. So that hasn't happened yet in the current bull market, but something like it probably will, I think, at least. So, I think we have a lot more all-time highs to go. I I think we're still going to keep going for a little bit of time here. >> I think we absolutely have more than a double in gold. Uh I think that, you

know, if I had said that $10,000 was possible when I wrote my first book back in 2007 and 8. Uh well, it came out in 2008, but it was written in 2005, 6, and 7. And uh uh if I had said that $10,000 was possible, everybody would have called me absolutely crazy. But one of the things that I've put in both books is that uh you know, at the be back in the early '7s when gold was just leaving $35 an ounce, a lot of economists thought that gold was going to fall in price, not rise, because there wouldn't

be any more central bank demand now that it was demonetized, basically. And anybody that predicted that $100 was possible was considered an absolute lunatic. And if you said $200 was possible or $400, it was like time up and put him in a rubber room because this guy is really crazy. Uh and you know, we ended up going to 873 intraday. Um, so anyway, early on in bull markets, uh, people, uh, point to the people that end up being very accurate, the ones that were actually right and calling them crazy. And so, uh, I still

think that there is a lot more room to run. >> I agree. I agree. And one thing to remember, people are used to the stock market where you get the biggest move first and then smaller and smaller moves until it levels off. Precious metals work the opposite way. You start with really small moves, then you get the medium moves, then you get the biggest moves at the end. So, it goes the opposite order you're expecting. So, >> I I want to encourage everybody once again to just get the Kindle version of

the book if you want. It's $9.99 for great gold and silver rush of the 21st century because in there there is a section of the there's a there's a chapter that compares the bull market of the 70s with the bull market of today which we are doing in this chart. But there's a a section of that chapter that's all about gifen goods and one of the things that we do is you know I've I've been showing this for years but it sort of goes over people's heads. Uh if you take a chart of gold and turn it

upside down, it looks more like a a chart of the stock market, the stock market has these round distribution dome tops and these real sharp uh crashes and Vbounces that are fear driven. Gold, it's fear driven toward the tops. And so you've got these spiky tops that it it really does look like an upside down uh the gold looks like an upside down stock markets chart. Stock markets look like an upside down gold chart. And it just shows that the dynamics of fear and greed are very different in these two

asset classes. >> Exactly. So anyway you look at it, we got more to go. All right. Next chart here. Accumulated gold ETF holdings uh compared to the price of gold. And you can see that they follow each other pretty nicely. Except the last couple years, ETF holdings have leveled off, even dropped a little bit while the price of gold has been rising. So that split's been going on about two years. So what do you make of this divergence here, Mike? >> Well, the problem here is that the

source is World Gold Council and Incrementum AG, and I don't know, did they include ETFs in China and so on? Most likely they don't have that data because the gap between those is most likely made up by people in the east. It's it's investment uh coming from China and then the wedding season in India and so on. Uh and so there there's something going there's two things going on here that plus central bank buying. Uh that could be one of the reasons for that gap because that the the um ETF

holdings isn't what is putting a floor underneath gold. It's it's definitely coming from elsewhere. And so uh this you know at the beginning I said that uh you know it it wasn't people you said that uh people have more people have had interest in gold lately. Yeah a few westerners but not that many. It's mostly uh Asia that was driving this. And I think this is the chart here that sort of sort of shows that it's coming from somewhere else. It's not coming from the retail investor in the United

States. >> Yeah, exactly. And to your point about central banks, yes, central banks have been net buyers of gold since around 2015, 2016, around this bottom here. And I think they're the ones providing the the tailwind for the price of gold for the last 10 years. And that's actually what our next chart is. Central bank gold purchases. >> Okay. >> So, so you anticipated that nicely. Uh yeah, we have it going back to 1950 here. So, you can see uh a lot of uh a lot of color on this chart. A lot of

different periods we have. So, central banks were net buyers of gold here. And France repatriated over 3,000 tons of gold. Uh Charles de Gaul and that's basically what led up to the Nixon shock in 1971. also led up to that collapse of the London gold pool. So for any any viewers that don't know, the London gold pool uh was a group of central banks led by the United States and whenever gold would rise to uh a significant amount like when it got up uh if it was supposed to be 35 bucks an ounce. Uh

that was the official price. That was the price that uh central banks traded it for. But when the free market price rose above that and there was enough a significant enough uh um price differential, the this group of uh central banks led by the United States would dump a bunch of gold on the market to cause the price to go down. And it was absolutely emptying the coffers. And the uh United States was the largest contributor to this because we had the largest stock of gold. And it really did suck a lot of

gold away from the United States. Uh and that collapsed as soon as France pulled out and started repatriating. [Laughter] So okay. And then and that is what caused so these three first events are a chain reaction. That is what caused the Nixon shock. Nixon had to take us off of the Breton Woods system which was the last connection to some sort of pseudo phony gold standard where we only had about 8% gold backing at the time. uh and uh uh because if gold kept on flowing out of the vaults because you

know under the gold standard uh any central bank uh any foreigner actually was allowed to show up at the New York Federal Reserve and they actually had a window where they would pay out gold for US uh Federal Reserve notes. Uh so you could cash in your Federal Reserve notes for gold uh at 35 bucks an ounce and gold was leaving the United States because of that because of this chain reaction of of events here. It's very interesting. Okay. And then oh UK uh and and Switzerland. So the UK sold almost

all of their gold, right? it it he's got a a very large rectangle there of uh of gold sa central bank sales uh I don't know which one it would be interesting to just isolate the UK but I mean they call it Brown's bottom Gordon Brown I think his first name was Gordon was uh chancellor of the ex-checker or something like that I can't remember his title uh and uh they sold all half half of all of their gold at the very bottom bottom down in the 250s. >> Brilliant, huh? >> Yeah, that's not good. You want to buy

low, sell high. You know, maybe he missed that day, >> right? And so they they sold it all at 250 and now they're buying back at 3,000. >> Anywh who, so yeah, so then uh basically after the global financial crisis, central banks started buying a ton of gold. So, and then after COVID, they started buying even more and of course Russia invaded Ukraine and we've had the asset freezes and seizures >> and now uh gold purchases are accelerating by the central banks. But to your point, to your point,

>> and if you overlaid that last chart with this, the the divergences um are uh largely driven by this most likely. So, yeah, I'm sorry I interrupted. What were you gonna say? Um, I was going to say to your point, Mike, uh, central banks are buying, but a lot of retail investors are still sleeping. They're not they're not there yet. So, >> Yep. Right. >> Hopefully, they'll join the party soon. >> Well, it's best to be early than than a minute. You know, it's best to be a year

early than a minute too late. So, >> Exactly. Exactly. So with all these central banks buying gold like one has to wonder what are they going to do with it right and what's going to happen to the monetary system either in the United States or globally well Scott Bessant secretary of the treasury he said uh I could see in the next few years that we are going to have some kind of a grand global economic reordering something equivalent to a new Breton Woods or if you want to look further back something

akin to the steel agreements or even the treaty of Versailles there's a very good chance we'll need this within the next four years and I'd like to be a part of it. >> Yep. Okay. So, um we made some videos on this and I I did I was in Arizona uh back in April. Uh I believe this is a February or March statement by Scott Bent. Uh, and I pieced this together with several other statements, some from President Trump and more from Scott Bent that sort of point toward, you know, if if this happens, something equivalent to

a new Breton Woods, it's most likely a global monetary system that's connected to gold and it can't be at these prices. It's got to be at far far higher prices than where we are right now. >> Exactly. Yeah. And so there's a series of videos if people look back into um uh March, April, May time frame, you'll see these videos on the possibility of a coming gold standard. And the evidence is there. And one of the things that was interesting is if you listen I think it's in this it might be no it's a

different uh interview than this where Scott Bent when you put these all together Scott Bent and Trump basically said gold gold gold not Bitcoin basically said Bitcoin is a riskon asset gold is a risk off and a riskon asset and uh So basically uh when everything is going well and you want to take gamles those are risk on assets risk off is where you run for a safe haven. So that's what that was those are his words not mine. So for the Bitcoin out there I just want to say that's Scott Ben's take

on it. The president the the secretary of the treasury. >> Yeah. Exactly. He came out recently in a recent interview and said uh that they're not going to be buying Bitcoin for the strategic Bitcoin reserve. They're just going to be confiscating criminals. >> I don't think they ever called it the strategic Bitcoin reserve. They called it a strateg. It's a strategic crypto reserve. But did they ever use the word Bitcoin? Because when they established this thing, I thought they specifically

said that they are not going to be buying any new Bitcoin. Um they actually created two different entities. One is a strategic Bitcoin reserve and they have they have uh legislation in place to never sell it and then they have another one that's a digital asset stockpile and I believe the language is they will develop strategies for responsible stewardship which doesn't prevent them from selling it. Um so yeah, that's where they're at. But but he did come out recently and say that they're not

going to be buying Bitcoin with taxpayer money probably because they can't come up with a revenue neutral revenue neutral way to do it. Um but he did say that. So the implication is that they will only have Bitcoin from confiscating it from criminal proceedings. So >> okay. >> So yeah, so that's where we're at with that. So go ahead and get your gold before they revalue it. >> Here is the US M2 money supply per capita. So this is per person in the US going back to 1900. So, of course, the

population grows over time, and I believe it's grown by a factor of four or five since then. I might be wrong about that, but the M2 money supply per person has obviously grown much faster. Uh, if they kept pace with each other, this would be a horizontal line. It would be perfectly flat. If the currency supply grew at the same rate as the population, >> obviously, it's growing exponentially. This is over 500 times larger. So, you know, every time we get a new person, we get $500 more dollars. Like, it's it's

crazy. This is growing way too quickly. >> Yes. Okay. So, uh it it would be interesting to plot this growth um against uh inflation except you you know you'd have to pick some sort of mean between the way the government used to measure inflation and the way they measure it today because what we've shown lately the difference between the shadow stats government uh shadow government statistics um uh alternate CPI which is the original way that the US calculated inflation and then the a

that they, you know, they keep on fiddling with it. Every few years they change their methodology of calculating inflation just to massage the numbers and make them look a little bit better to everybody. But it would be interesting to plot these because this is where the inflation comes from ultimately. There are short-term changes in velocity and some other things that cause inflation and lack of inflation. Uh but ultimately this is where it comes from. And you said if it grew um uh equally with the population, it would be

a flat line. Well, that's what gold does. We make babies at about the same rate that we mine gold. And that's the reason it has constant purchasing power uh for, you know, not not absolutely flat. It goes up and down inside this valuation range. But you go back to ancient Rome to today and there's a range of purchasing power that gold has. Okay. So >> yeah, >> what's next? >> Yep. Uh we have the shadow gold price at different gold coverage levels. So basically with all that M2 currency

creation and of course M0, M1, right, all the different measures you want to use, currency has been exploding. So if the price of gold were to be adjusted either by the free market or by a new monetary system that revalued it, the question is what price of gold would it have to be revalued to so that the price covers the amount of currency that's been created? So this chart is showing six different examples, six different possibilities. >> So I'll I'll walk everyone through them

uh one at a time here. So, if if the price of gold covered 25% of M0, the price of gold would have to be $5,100 per ounce. Okay? If it covered 40% of M0, it'd have to be about $8,000 per ounce. If it covered all of M0, $20,000 per ounce. >> If it covered 25% of M2, about 50 58,000, 40% of M2, 92,000. and all of M2 $231,000 per ounce. That that of course is absurd. Um so yeah, Mike, what what do you think would be a reasonable level of coverage here? >> Uh well, first of all, uh M0

incorporates uh a few uh different aggregates of the currency supply. What gold backs currently in the monetary system and historically is only the currency in circulation. It backs the Federal Reserve notes. So trying to calculate what what it would have to be if it was to cover M2 is absolutely pointless. It's ridiculous because the Federal Reserve does not guarantee all of the bank credit that is created. It's not going to ever cover bank credit. So for anybody to uh run these calculations

of well what would it take if gold covered the the currency supply? Well, I believe it's about 92% is created by the banks and not the Federal Reserve. And so, um, uh, you have to eliminate that. So, those blue, uh, bars are basically a pointless exercise. It's never going to happen. It won't. Uh, if uh, right now uh, almost all what how much did we calc it was like 99.7% of all America of America's gold was pledged to the Federal Reserve. And so they have basically a lean on on America's gold

and those gold certificates which could be revalued under this new system that Scott Bant was talking about. Um uh and something like this I think this this might be in our future. It's going to be a giant shock to the global monetary system if it happens. And it's only really going to happen if there is a major crisis. But I see a major crisis coming. So um uh the historically we had treasury notes 100% backed by gold. So if you had a note that was the IOU. If you had a dollar bill or a $20 bill that

was the IOU from the Treasury and it said there have been deposited in the Tre Treasury of the United States $20 in gold coin payable to the bearer upon demand right on the note. And so that was the IOU and a gold standard is self-funding. a gold mining company digs up a bunch of gold, sells it uh to the treasury, and the treasury buys it just by creating the IUs for it. So, they print the currency, and then the gold that they just bought backs the IOU. So, it's a self-funding process. It's

nothing that has to be taken out of taxes or anything else. uh but um the 40% is the ratio that fell apart during the great depression when the Federal Reserve was established. We went from a 100% uh gold backing of the currency, the IUS to IUS that were only 40% backed, meaning 60% of the IUS were fraudulent. That this was a lie. And that's what caused it to fall apart is because they were lying. So if they pick a 40% reserve ratio, you can this is the reason I've always said gold standards

suck. Gold is great, but gold standards suck. Uh the lie is what fell apart. And then they didn't establish a a uh a bylaw reserve ratio for the Bretonwoods system and they just kept on creating currency and it fell to about 8%. Uh but basically um you and I already did this calculation in one of our videos from uh April or May. Uh but it was $9,044 to cover 100% of the currency in circulation. not M0. Uh so uh you know by now maybe we're uh very close to $10,000 an ounce to cover to do to go

back to what historically was the portion of the currency supply that uh the US gold covers. But the US uh gold that that you know the gold that is supposed to be held interest for all of the US citizens is not going to be used to back private bank credit banks. You know they have some rules that they have to uh um live within and uh and the Federal Reserve can tighten up those rules or loosen up those ru rules but there are rules that govern that. Uh but the US has never guaranteed the bank credit that they create and that's most

of the dollars that exist. >> Yeah. So, you're thinking $9,000 or $10,000 an ounce would be enough to cover currency in circulation. And we may overshoot that temporarily if it happens due to free market factors. >> That free market factors plus uh how much uh uh headroom does the government want to be able to do deficit spending? Because this really puts a constraint on on everything, how much currency you're going to create. Uh it it you know they're talking about goldbacked bonds

and they used to have goldbacked bonds before uh everything fell before uh Roosevelt uh made private ownership of gold illegal they had to uh abregate it's called uh the uh gold clause in all of the US uh treasury bonds that said they were redeemable in in lawful money uh which included gold coin Yeah. No more lawful money. Not in this country. >> Right. So, for anybody that wants proof of this, just go to the Federal Reserve's website or just do an internet search for Federal Reserve H.4.1 4.1

release and scroll to the bottom and you will see that the only place on the Federal Reserve's balance sheet that the US gold is uh being used monetarily is to back currency in circulation that's the last item on the H.4.1 4.1 release. And if you take uh that the the number of ounces that we've got divided by the currency in circulation, you need $9,044. At least that's what it was when we made a video about it recently. Uh to back the currency in circulation, and that is what they did historically.

>> Well, we got one more here. Comx gold deliveries in thousands of Troy ounces. Uh, and you can see that there's there's a there's a long-term trend that's relatively low of how much gold is is delivered and then it spiked here a few years ago in the COVID era and now it's ticking up even more the last year or so. So, a lot of gold being delivered off of Comx. >> Yeah. uh you know this is um these are a few smart people that are worried and they're just getting right to the front

of the line and and basically uh they're not holding the IUS anymore. That's the difference. Uh the ones that don't take delivery are just holding IUS. Will those IUs be any good in a crisis? Who knows? >> Yeah, exactly. And speaking of IUS, do you have enough non-debt money, Ray Dalio? Right. >> Okay. So, you know, I hope Rey joins the party uh that years ago when when I was uh when Robert Kiyosaki first put me on stage in front of a large group. He had put me on stage in three times in front

of 300 people. And then I went to ask him if I could be the rich dad adviser for precious metals. He said, "You've got to write a book first." And we were meeting backstage at the Los Angeles Convention Center. And this was during a break right in the middle of uh this uh the the this conference uh where he was speaking. And so everybody was out in the uh hall having lunch and then they were coming back into the speaking hall. Uh and you could hear uh his name being said over the loudspeakers and he he

goes, "I've got to go out on stage now uh but I'd like you to wait back here and then I'll bring you out and you can tell them when Nixon took us off of gold in 1971." And when he introduced me, so I'm waiting backstage and he introduced me and he goes, "In 1971, the dollar ceased being money and became currency and I went bing, oh my god." And I started researching this and I'm like the only one that really went after this. Uh he started using uh referring to the dollar

as money. But that that was basically the day that I stopped uh you know when I researched it and found that you know uh that the key attributes are it's got to be a medium of exchange. It's got to be a unit of account so that you can put prices on things and a store of value. And if you do an internet search right now for what are the key attribute what what are the key attributes that something has to have in order for it to be called money. Uh even on the Federal Reserve's website, the Federal Reserve

says the most important attribute is that it's got to be a store of value. Well, it's lost 99 something% of its value since the Federal Reserve uh became, you know, took took charge of it. Uh Aristotle was the first one to define these characteristics. And so you're talking a few thousand years we've known this. what something has to do, its functions has to be before it can be called money. The dollar does not qualify, nor does any national fiat currency. If it's debt-based, it is not

money. So, do you have enough non-debt money? Well, if it's money, it isn't debt. So, basically, you can draw a line between the word debt and money. And uh there's money is non-det. >> Yeah. And so >> exactly. So this is redundant. This is redundant. >> Do you have enough money instead of currency? That's the point, right? >> Exactly. I I agree. >> One of the things that's interesting is a lot more people have been defining the difference between money and currency.

And I've been fighting for this for more than 10 years now. >> Yes. Yes. Fight the good fight. I love it. Well, thank you, Mike, for doing all that. So, for anyone So, for anyone who uh is a little bit unclear what we've been talking about here, we have uh gold at all-time highs, but not quite as many all-time highs as it used to have. We've got uh ETFs, a divergence between ETFs and the price of gold. We've got central banks buying a ton of gold. And the Treasury of the Secretary talking about

a new monetary system. He thinks it's going to happen and he wants to be a part of it and he thinks it's going to be gold. So, what does that all spell? Well, it spells our meme of the day. It's a fill-in-theblank meme because you have to answer this for yourself. What are you going to tell your children when they ask you, "Did you buy gold, Daddy? >> Did you or did you not?" >> Yeah. And what you want is that positive response down at the bottom there. Legend.

>> Legend. Legend. >> Awesome. Okay, I want to thank you, Alan, for this presentation and thank everybody for watching. We'll see you later. Invest and earn up to $2,000 in bonus silver at golds.com. It's easy. Step one, open any golds storage account excluding IRA. Step two, purchase your precious metals. Step three, get up to $2,000 in bonus silver dropped straight into your vault. Visit golds.com/frees to claim your silver.