gold news

 Hello everyone, welcome to Bald Guy Money. And we start this video off with an interesting report released by the famous Black Rockck back on August 29th, so about a week ago, called 2025 fall investment directions, where they published their outlook on the market, risks they see, and their advice for investors on how they should rethink the way they structure their investment portfolios, taking all of these factors into consideration. And what the report said was that investors should consider

gold as an alternative to challenges appearing in the market when it comes to stocks and bonds. And it issued an additional warning on bonds, suggesting, as far as I understood it, that a combination of lower interest rates and persistent inflation could result in interest rates earned on cash savings to turn negative and to seek sources of income elsewhere, like dividend stocks. Now, mind you, this report was released right around the same time mainstream news outlets who are paid by companies

to attract investors and are always bullish on the stock market were spreading fear and uncertainty when it comes to buying gold, including CNBC's famous inverse or opposite indicator Jim Kramer, who said, "I like gold, but that's a bad reversal." Less than 24 hours before gold made a new all-time high. And that post just so happened to be made on the very same day, coincidentally of course, that CNBC released this article aimed at spreading doubt about gold ownership by claiming

people who purchased gold in September of last year are not actually doing as well as they think they are. Because when they try to sell their gold, and listen to this, this is rich, they will only get 90 to 95% of spot price back, which is of course total nonsense. And the article continues on to give a long explanation about how capital gains apply to gold as if they don't apply to anything else despite some minor differences in the rate levels. Now, why I bring this up is because this is a

classic case of do what they do, not what they say or tell you to do. Because while the mainstream media was executing a coordinated fear campaign, as far as I see it, against gold last week, big players continue to abandon popular investment approaches as they execute a significant restructuring of their portfolios to get ahead of something that happened in 1980 and 2011 when gold and silver hit new, very extreme highs. And the reason they're doing it is because it's about to happen again. And

that is precisely what I want to cover in today's video. Starting with the reason so many investors are finally giving up on the 60/40 portfolio and what it has to do with market conditions we saw in 1980 and 2011. Then I want to dig into what it means for gold and silver prices with a couple scenarios showing possible price targets. And we'll finish this video with a followup on gold and silver affordability and why the crisis of affordability will probably only get worse from here before

it gets better. Now, just before we dive in, please remember to check out summitmetals.com if you want to buy gold and silver at a great price from a dealer you can trust, including 5 ounces of silver at spot when you use code new customer at checkout. Details are in the video description below. So jumping in, I mentioned a moment ago the 60/40 portfolio. And as a little bit of a background to those of you who don't fully understand what that is, it is an investment approach that was developed

in the 1950s by a guy named Harry Marowitz. And he's called the father of modern portfolio theory. And his approach, which has been adopted by financial adviserss around the world, mind you, is still widely in use today and has people split their investments with 60% of their money being allocated towards stocks for wealth growth and 40% of their money being allocated to bonds for stability and to generate a guaranteed passive income. Now the growing problem with this strategy and why people are abandoning it is because

as currency debasement around the world accelerates the 40% that people have been putting into bonds is earning less and less with real problems starting when the real rate of return which is what you're looking at on the screen now and measures the interest rate on a bond minus inflation when it goes negative again that's when these real problems start and that is precisely what happened as you can see here in 1980 and 2011 when gold and silver prices exploded. And why this is so important

and why it led to two major blowoff tops in gold and silver prices in the past is because big money investors will not tolerate a guaranteed loss that negative real rates deliver. And that includes foreign central banks, by the way, who, as I demonstrated to you all last week, are leading the way out of the 40 side of the 60/40 portfolio. So, I mean, out of US treasuries in this case, and into precious metals in anticipation of another 1980 and 2011 moment because metals, as far as I see things, are the

only safe haven left. And it seems these central banks agree completely with me. Now, it's not only central banks that are doing this because it's big financial institutions that are following suit and they're doing it at a faster pace now because if the White House is able to gain more influence over the Federal Reserve and the real rate of interest, which as you just saw currently stands at 1.68% officially, but is probably negative if we factor in real levels of inflation. It means lowering interest rates by the

desired 3 percentage points as Donald Trump and his administration have said they want to do guarantees a return as we come back to this image showing real US interest rates of real negative interest when measured by even official inflation figures. Meaning the part of the 60/40 portfolio that was supposed to be safe becomes a guaranteed loss. In fact, it's a guaranteed loss already if you're in long-term bonds. And it's why in 2025, we hear more and more people saying that savers are losers and cash

is trash. And as a reminder to you all, in the spirit of look at what they do and not what they say or what they tell you to do, as I've said plenty of times here on the channel, this is what central banks have been preparing for since 2010 when they became net buyers of gold again after 20 years of selling because they saw the writing on the wall. Now, this is going to continue to impact gold and silver prices in big ways moving forward. And it's why I keep telling people to prepare themselves for

this because as things stand today, according to SIFMA, which is the Securities Industry and Financial Markets Association, there is about 145.1 trillion parked in fixed income assets around the world. And this includes government bonds, mortgage back securities, corporate bonds, and more. And with real interest rates ready to go negative again, as I've just shown you, a significant portion of this money that doesn't want to lock in long-term guaranteed losses is going to move out of fixed income and into precious

metals. Because, as I've said in the past, precious metals are the only real alternative to bonds and devaluing currencies in an uncertain market. Now to give you all an idea of exactly how much money we're talking about here and how it can move the price of gold and eventually silver and I will cover both in this video. So please just follow me through the steps here. Starting with gold. If 20% of the money that is currently allocated to these fixed income investments moves to gold over

the period of a few years as investors and account managers start to wake up to the fact that inflation and falling interest rates are just too risky. It means we could see $29 trillion just from the fixed income market move into gold. And that doesn't even include other sources of new money flowing into gold like regular investor buying. And to keep things simple, if we just add $29 trillion to the current estimated market cap for gold, that gives us more or less a new price for gold at $7,841

per ounce. Now, as I see things, this is a very realistic scenario to expect over the next few years with price really going to be driven up even higher as other sources add to inflows moving into precious metals. And we'll get into that in a second. But on the conservative side, if we ignore the massive bond market and focus in just on global assets under management by investment companies on behalf of clients like what Black Rockck does, it means we could be seeing at minimum a portion of what they

hold in fixed income investments moving into gold in line with what I showed you at the start of the video with BlackRock looking at gold due to what they call positive stock and bond ond correlations. Now, considering that roughly 29% of the $148.3 trillion these asset managers control is in fixed income investments like bonds. If we assume they will allocate roughly 20% to gold like we did in the previous calculation, it means that in a conservative scenario as asset managers hedge their risk against real negative

interest rates, we could be looking at 8.6 $6 trillion poised to enter the gold market. Which if we add that to the market cap of gold today suggests a new spot price without any other inflows coming into gold of about $4,847 per ounce. And realistically, I think we could be looking at this over the next 2 years, especially if faith in the bond market and the government's ability to pay back its debts without printing new money continues to fall. So coming over to silver with the understanding that

where gold goes silver follows and at some moments it follows at a much faster pace. If we take the two prices for gold that we may expect to see as the world kind of rebalances its 60/40 portfolio and we apply a gold to silver ratio of between 60 to 40 to it. Meaning that anywhere from 60 to 40 ounces of silver will be equal to the price of 1 ounce of gold in the future. And just for reference, that number is 87 as I'm making this video today. So 87 ounces of silver equals 1 ounce of gold. What we

could end up seeing in a conservative scenario is $80 per ounce silver in the next couple of years to as high as $200 per ounce of silver in the longer term, more aggressive scenario, which for those of you wondering matches up closely to numbers I have shared here on the channel in the past. I believe it was in early 2024 I first shared these numbers and my longtime viewers will definitely recognize this image because this is where I've said I can see us going over the next 8 years with gold

hitting almost $12,000 an ounce and silver reaching $200 an ounce factoring in all sources of inflows into precious metals as we see prices track closely to the moves up we saw between 2002 and 2011 just from a higher base this time. As we get closer to 2033, which I have said in past videos is of major importance because that is the year US Social Security starts to run out of money and may have to print the difference to deliver payments to benefit recipients. And I want all of my viewers, all of you watching this video

right now to keep this long-term view in mind when considering precious metals. Now, just before we continue to the topic of why I think the gold and silver affordability crisis will not get better, please remember that if you want to diversify your hard asset portfolio into land before we see more asset price inflation, which I have said is coming, visit channel partner landofland.com. Properties like this one located in Arkansas and selling for less than the price of 3 ounces of gold are a great

way to diversify your hard asset portfolio and add hard ground under your feet in a well-located area with access to water at a reasonable price. And to see what else they have, check out landofland.com or call them at the number on the screen and use code bald guy to get $300 off your purchase as many of my viewers already have and I think it's something everyone should at least consider. So, with that covered, it's time to answer this video's viewer question. And please remember that you

can submit your questions in the comments section of every single video I do. I select one question to appear in every video I do. And you never know, yours just may be next. And this week's question, which continues a topic that I started last week when I talked about gold and silver becoming unaffordable for regular people, comes from Jonas Watson. And Jonas asks, "If the price of gold goes too high, won't that cause demand to drop and prices to fall?" And it's a good question because, as the old

saying goes, high prices are the cure to high prices. And it's a quote I've mentioned on the channel before when examining a claim from Morning Star analyst David Sakara, who said exactly that back on March 20th of this year. Now, although gold price is up 18%, so more than $500 an ounce since the article was published, I suppose I have to give him the benefit of the doubt because he did say that it would happen 5 years from now. And the basis of his argument is that the drop in price will

be caused by slow jewelry demand because it makes up about 50% of total gold demand worldwide as you can see in the image here on the screen. But the main point that Mr. Sakara and people like him are not taking into consideration when they say higher prices will cure higher prices is the very reason prices are going up right now and the reason is because the US dollar is weakening and is slowly being replaced by gold as the basis of the world's financial system which is simply a return to what we used

to have before 1971 and as a result of that as I presented to you all in the first part of this video, there is a heck of a lot of money that needs to slowly get out of the dollar and get into gold. And it's a process that has already started. But it means that without a doubt, gold can continue to go up even without participation of the jewelry market because it's done just that over the past year. Gold has gone up more than 40% in price over the past year despite a 14% drop in demand for

gold jewelry because investment demand is replacing the demand for jewelry. And that movement from the dollar to gold doesn't show any signs of slowing down. In fact, it's only showing signs of speeding up as India is now publicly repairing relations with China, potentially paving the way for more ddollarization moving forward. And El Salvador, a country famous for building up a Bitcoin reserve, just made a major strategy shift and has entered the gold game, buying $50 million of gold this

past week, which is something I told you all to look out for back in February, because if more countries around the world start to participate in this gold buying spree, as they realize they need to have gold reserves with the dollar potentially on its way out, or at least on its way to playing a smaller role in the global financial system. It means we could be entering, as I said in that video back in February, a 12year bull market as central banks of the world in order to reach a reasonable level of

gold holdings still need to buy 44 million troy ounces of gold. And since they buy out of necessity and they are not price sensitive, higher prices in this scenario are not necessarily going to be the cure to higher prices. And gold along with silver will continue to fall in affordability for the average person. And the reason is because the average person who's lining up at the local coin shop right now to sell their gold and silver doesn't matter much in this equation. It's big money driving

the prices of metals up right now. It's the trillions of dollars coming out of the bond market. It's the money central banks can create out of thin air that is buying a lot of this gold today. And what we saw this past week continues to prove that as the price of one ounce of gold is now higher than US median household income multiplied by the savings rate, which in theory tells us that with gold price where it is right now, the average American household cannot afford to save even one full

ounce of gold in a year. So Jonas, I hope that answers your question and thank you very much for submitting it. And thank you to everybody who's made it this far in the video. Please remember, if you like my content, leave a like below. That tells YouTube to recommend this video to more people who need to hear this message. And if you have any questions for me, please leave them in the comments section below and I may answer your question in my next video. And as I end all of my videos, I want to

encourage everybody out there to take care of yourselves . But more importantly, please remember to take care of each other. See you in the next video.