1 00:00:00,240 --> 00:00:04,080 I sadly don't think that we'll get to that point where gold backs a currency 2 00:00:04,120 --> 00:00:07,400 anymore, because you said it. It takes the power out of the politician's 3 00:00:07,440 --> 00:00:09,839 hands, and they're going to hang onto that power as long as they can, 4 00:00:10,080 --> 00:00:13,560 and I'm really afraid they'll blow up the dollar and the financial system of 5 00:00:13,599 --> 00:00:17,039 the process. It's not a happy thought, but it's a realistic one. 6 00:00:17,079 --> 00:00:22,320 I think you're listening to Carrie Letz's Financial Survival Network, where you get valuable 7 00:00:22,320 --> 00:00:27,879 information you just can't find anywhere else to thrive in today's trying times. You 8 00:00:27,960 --> 00:00:34,200 need the Financial Survival Network now more than ever. Go to Financial Survival Network 9 00:00:34,280 --> 00:00:41,000 dot com and get your free newsletter and gift. Financial Survival Network now more 10 00:00:41,079 --> 00:00:49,719 than ever, and welcome. You aren't listening to watching the Financial Survival Network 11 00:00:49,759 --> 00:00:53,560 of your host Carrie Letz. Well, gold looked like it was going to 12 00:00:53,640 --> 00:00:58,240 break out and stay over that two thousand range forever. It would be a 13 00:00:58,320 --> 00:01:04,239 distant, a distant glimmer in the times when it was below two thousand. 14 00:01:04,319 --> 00:01:08,560 But here we are, and it's retraced a bit. We're under two thousand. 15 00:01:08,640 --> 00:01:14,159 But we got a special guest for you today and his name is Danis 16 00:01:14,200 --> 00:01:21,519 Samuelson, founder president of American Gold Exchange, a company I once bought some 17 00:01:22,000 --> 00:01:25,439 gold from a long time ago. Then it's great to have you on the 18 00:01:25,439 --> 00:01:29,239 show. So what is going on with gold now? When do you think 19 00:01:29,239 --> 00:01:33,959 it will raise num it's upward journey or will it hi carry well? Thanks 20 00:01:34,000 --> 00:01:36,519 for having me, It's great to be here. I appreciate your being a 21 00:01:36,560 --> 00:01:41,840 previous customer of ours. So gold gold is consolidating right now around the two 22 00:01:41,879 --> 00:01:46,359 thousand dollar mark. You know, last year we had a pretty whipsad year 23 00:01:46,519 --> 00:01:52,359 because the dollar was abnormally strong due to an interest rate differential here in the 24 00:01:52,480 --> 00:01:57,519 US compared to the other major economies of the world. The Fed raised rates 25 00:01:57,680 --> 00:02:02,760 harder and faster than they have before, and interest rates here were higher than 26 00:02:02,920 --> 00:02:07,800 in Japan, the Eurozone, Great Britain, which made the dollar become very 27 00:02:07,800 --> 00:02:10,800 strong for a period of time and pushed gold down to a six local low 28 00:02:10,840 --> 00:02:16,360 of sixteen thirty five. Now we've seen a big correction back up, especially 29 00:02:16,400 --> 00:02:22,759 after the bank failures Silicon Valley Bank. We're gold punched up to previous all 30 00:02:22,759 --> 00:02:25,120 time high of two thousand and eighty dollars an ounce about a month ago. 31 00:02:25,599 --> 00:02:30,439 And the key to the gold market now, in my opinion, is the 32 00:02:30,560 --> 00:02:36,000 value of the dollar relative to other currencies. And on the Dollar Index, 33 00:02:36,520 --> 00:02:40,080 which is now at about one oh three, the dollars looking up a little 34 00:02:40,120 --> 00:02:44,439 bit better than it has in the last two months, where it channeled at 35 00:02:44,479 --> 00:02:47,599 a bottom of one oh one and a half. Gold tends to trade inversely 36 00:02:47,680 --> 00:02:52,439 to the dollars. So when the dollar is strong, like it was last 37 00:02:52,520 --> 00:02:55,520 year at a peak of one fourteen on the Dollar index, that's when gold 38 00:02:55,560 --> 00:03:00,319 bottomed at sixteen thirty three. Today the dollars of one oh three, I 39 00:03:00,360 --> 00:03:05,439 do think we're going in towards an economic slowdown, if not a full blown 40 00:03:05,439 --> 00:03:07,479 recession, it looks like we're on the cusp of that, which would weaken 41 00:03:07,560 --> 00:03:12,120 the dollar. That'll help to buoy gold higher, because as I said, 42 00:03:12,159 --> 00:03:20,080 gold trades inversely to the dollar. More importantly, we've got bond yields are 43 00:03:20,199 --> 00:03:24,639 near cyclic cyclogal highs right now, and your treasure yield about three and a 44 00:03:24,680 --> 00:03:31,280 half percent. Remember that was about one percent two years ago. And gold 45 00:03:31,400 --> 00:03:37,000 does not do well typically when yields are high, because gold doesn't pay a 46 00:03:37,039 --> 00:03:40,159 dividend. Well, if the FED is forced to pause, which they will 47 00:03:40,159 --> 00:03:45,120 probably they may be done raising the federal funds right now. We'll see how 48 00:03:45,120 --> 00:03:49,479 inflation goes. But gold has responded to the anticipation of a pause, and 49 00:03:49,560 --> 00:03:53,319 that's part of the reason that's bullied up to around two thousand dollars announced and 50 00:03:53,400 --> 00:03:59,159 held that floor for quite a while. Now two months, when yields come 51 00:03:59,199 --> 00:04:01,759 down, that will really open the door to higher gold price, and I 52 00:04:01,800 --> 00:04:05,599 think that we're on the we're looking at that later in the year, either 53 00:04:05,680 --> 00:04:11,560 as the FED decides to cut interest rates or the economy slows down. Either 54 00:04:11,599 --> 00:04:15,800 way, I think yields will ease, if not fall further from the heights 55 00:04:15,800 --> 00:04:16,959 that they're at now and now will move the gold price. So I think 56 00:04:17,000 --> 00:04:21,720 gold has upside potential of ten to fifteen percent in this environment. That's a 57 00:04:21,720 --> 00:04:30,600 pretty easy gain barring any other unusual for circumstances in the economy, like another 58 00:04:30,639 --> 00:04:33,839 big bank failure. It looks like most of the banking issues have been pushed 59 00:04:33,839 --> 00:04:39,600 through the system, although some systemic risk. The risk still exists, I 60 00:04:39,639 --> 00:04:43,800 believe. Yeah, So what of the bank failures and all that, You 61 00:04:43,879 --> 00:04:49,240 think it's really behind us or road as it just left the headlines for a 62 00:04:49,240 --> 00:04:54,360 while. Well, it's hard to say. You know, the first two 63 00:04:54,439 --> 00:04:59,240 weeks follow wing the Silicone Valley bank failure, we saw a huge exodus of 64 00:04:59,439 --> 00:05:03,959 excess cash reserves and banks moved primarily into the US treasury market, and that 65 00:05:04,079 --> 00:05:11,199 was a crisis of confidence in the banking system. If that rate of deposit 66 00:05:11,279 --> 00:05:16,399 departure had continued, it would have severely challenged the banking system. So confidence 67 00:05:16,600 --> 00:05:24,240 was restored because the FED backstopped the depositors over two hundred and fifty thousand dollars 68 00:05:24,279 --> 00:05:28,839 all of them. They put another three hundred billion back in the system that 69 00:05:28,879 --> 00:05:32,199 they were trying to take out to help liquefy things. So confidence is back, 70 00:05:32,279 --> 00:05:38,279 but that doesn't ease the fact that there are a lot of treasuries and 71 00:05:38,319 --> 00:05:43,160 securities that are held by banks that are upside down right now because they yield 72 00:05:43,199 --> 00:05:47,959 his jump so much and we haven't seen a rate increase from the FED and 73 00:05:48,160 --> 00:05:53,800 yields rise like this at this rate since the last inflationary cycle. Now, 74 00:05:53,839 --> 00:05:56,519 I got a little snow on top of the mountain over here, so I 75 00:05:56,600 --> 00:06:01,360 remember the last inflationary cycle, and today you've got money managers, bankers that 76 00:06:01,439 --> 00:06:04,399 are in their thirties, that are in their forties, even in their fifties, 77 00:06:04,439 --> 00:06:10,879 that don't know what how to manage risk in a rate environment change like 78 00:06:10,959 --> 00:06:14,720 we've seen, and that's exactly what happened in Silicon Valley Bank. They didn't 79 00:06:14,759 --> 00:06:18,759 manage their risk properly, specifically duration and yield risks. So there are still 80 00:06:18,759 --> 00:06:25,519 problems in the system, and easing of the rates will help to mitigate some 81 00:06:25,600 --> 00:06:29,079 of the losses that are on paper. It all comes down to whether they 82 00:06:29,120 --> 00:06:31,879 have to actually take the losses that they have on paper or whether they can 83 00:06:31,879 --> 00:06:36,480 trade themselves out of their losses. Over time, We'll see, But another 84 00:06:36,480 --> 00:06:41,680 shoe could still drop it just will it Maybe Maybe it's hard to say, 85 00:06:42,240 --> 00:06:46,199 Well, it's not just the United States banks that are on the balls of 86 00:06:46,319 --> 00:06:50,160 their feet, so to speak. China, you know, their banking industry 87 00:06:50,160 --> 00:06:57,079 has been insolvent longer than the US's has. And Europe with the bailout of 88 00:06:57,120 --> 00:07:01,759 the Deutsche Bank and the credits was for ust acquisition, all these things that 89 00:07:02,720 --> 00:07:09,079 a banking system that's kind of on its way out. Perhaps well, there's 90 00:07:09,079 --> 00:07:13,680 no doubt that there's a lot of fundamental problems with our overall financial system. 91 00:07:13,839 --> 00:07:17,360 You know, too much debt. We've just increased the deadload dramatically over the 92 00:07:17,439 --> 00:07:23,439 last fifteen years from the Great Financial Crisis and then COVID. Now inflation is 93 00:07:23,480 --> 00:07:28,120 here, and it's probably much more entrenched than most people realize. I have 94 00:07:28,160 --> 00:07:31,800 a hard time believing that we'll get the base line rent down to less than 95 00:07:31,879 --> 00:07:35,680 three percent, and probably less than four percent may be difficult for the Fed 96 00:07:35,720 --> 00:07:41,680 to achieve unless we go through a real strong economic slowdown and the demand just, 97 00:07:42,079 --> 00:07:45,000 you know, really dramatically falls. You know, if you look a 98 00:07:45,120 --> 00:07:47,959 look at in the big picture, between seventeen ninety five and nineteen ninety five, 99 00:07:48,120 --> 00:07:51,920 the US accumulated five trillion dollars in debt, and in the last twenty 100 00:07:51,959 --> 00:07:58,839 eight years we've multiplied that sixfold. And that is just an astronomical rate of 101 00:07:58,879 --> 00:08:03,759 increase. It just cannot be sustained. Yeah, the whole system's unsustainable the 102 00:08:03,800 --> 00:08:07,040 way it is now. How bad do you think the recession's going to be 103 00:08:07,120 --> 00:08:11,120 here? At DANTA? That's inevitable recession. Well, as I mentioned, 104 00:08:11,240 --> 00:08:18,759 I'm kind of an armchair macroeconomist. It's really hard to say. The jobs 105 00:08:18,800 --> 00:08:22,800 market remains strong, but jobs are the last thing to go. You know, 106 00:08:22,839 --> 00:08:28,839 we've already seen the housing market dramatically impacted by higher interest rates. Manufacturing 107 00:08:28,920 --> 00:08:33,240 is usually the second leg to go to weaken, where orders fall off and 108 00:08:33,279 --> 00:08:41,200 then profits fall and then employment falls. I think they call that the hope 109 00:08:41,200 --> 00:08:46,480 cycle, housing orders, profits, employment. Right now, we're somewhere between 110 00:08:46,399 --> 00:08:50,759 orders and profits, and it just depends on how weak, you know, 111 00:08:50,799 --> 00:08:56,000 how much resistance the economy really gets from these higher interest rates. One thing 112 00:08:56,120 --> 00:09:01,080 we are seeing is bank lending is slowing down dramatically, and that's going to 113 00:09:01,200 --> 00:09:05,080 help the Fed attain their goal of slowing the economy down without potentially raising rates 114 00:09:05,120 --> 00:09:09,240 further. But bank landing is the key to small business and medium sized business, 115 00:09:09,320 --> 00:09:15,080 and that's half of the economy. And you know, I saw what's 116 00:09:15,120 --> 00:09:18,200 his name among Shark Tank, Kevin O'Leary is at his name, Yeah, 117 00:09:18,440 --> 00:09:20,639 do an interview a couple of weeks ago, and he said, you know, 118 00:09:22,000 --> 00:09:26,919 businesses that can typically borrow against ninety days of receivables at seven or eight 119 00:09:26,960 --> 00:09:31,960 percent are now paying twenty five and thirty percent interest to get that same ninety 120 00:09:33,039 --> 00:09:37,960 day receivable ash flow back from lenders. And that's a killer for small businesses 121 00:09:39,039 --> 00:09:43,320 who can't you know, wait that long between paying for their goods and being 122 00:09:43,399 --> 00:09:48,720 paid for their products or services. Materials rather and then products and services. 123 00:09:48,759 --> 00:09:52,559 So that's sure, it's hard to say in my opinion, but I think 124 00:09:52,720 --> 00:09:56,919 if you look at the yield inversion curve, which is steep, and it's 125 00:09:56,960 --> 00:10:01,519 been steep for nine months now, that's is one of the biggest recessions we've 126 00:10:01,559 --> 00:10:03,799 had since the eighties. Now, whether we have materializers or not, it 127 00:10:03,799 --> 00:10:07,240 all boils down to consumer spending, which is of course seventy percent of our 128 00:10:07,279 --> 00:10:13,240 economy. Yeah, so we have this recession and then the FED cuts rates, 129 00:10:15,039 --> 00:10:20,559 but economic activities down, deficit goes even higher than it is now to 130 00:10:20,080 --> 00:10:26,639 two three trillion a year. Where does that leave us? It's just the 131 00:10:26,759 --> 00:10:31,039 debt. We have a debt problem, and we keep compounding it by creating 132 00:10:31,080 --> 00:10:37,559 more debt. Isn't that the solution that our leaders are constantly putting forth right? 133 00:10:37,679 --> 00:10:41,639 That's that's what we've been doing for fifteen twenty years now, and we're 134 00:10:41,720 --> 00:10:45,200 hearing the endgame because the interest that we're going to pay on our debt now 135 00:10:45,320 --> 00:10:48,039 is going to be the highest line item on the US budget and over a 136 00:10:48,120 --> 00:10:52,879 trillion dollars a year. Two years ago, our interest on our debt was 137 00:10:52,159 --> 00:10:56,360 half a trillion, five hundred billion. So we're getting into the point of 138 00:10:56,399 --> 00:11:03,120 time where GDP we'll take all our GDP just to pay the interest on our 139 00:11:03,159 --> 00:11:05,919 debt at some point in time, and that's when you know, things really 140 00:11:05,960 --> 00:11:09,720 fail, that's when the fun really starts. So all right, at that 141 00:11:09,840 --> 00:11:13,679 point, I guess you could expect to see gold go far higher than it 142 00:11:13,720 --> 00:11:18,399 is now. Yeah. It's the currency of last resort and the world's oldest 143 00:11:18,440 --> 00:11:26,919 and safest trusted form of money. Yeah. Gold is an international asset, 144 00:11:26,960 --> 00:11:33,639 it has no counter party risk, it's immediately liquid anywhere it's it's immediately valued 145 00:11:33,759 --> 00:11:39,039 all over the world instantly. The gold that will be a great hedge to 146 00:11:39,159 --> 00:11:43,759 have in an event where the dollar just continues. So we was purchasing power 147 00:11:43,799 --> 00:11:48,279 if it doesn't blow up all together, which will eventually happen if we don't 148 00:11:48,360 --> 00:11:52,519 change the course that we're on and politicians just don't have the resolve to fix 149 00:11:52,600 --> 00:11:58,120 the problems that we have. Yeah, and the isn't that the truth? 150 00:11:58,759 --> 00:12:03,799 And it's not just the US currency that'll go And they'll all go up and 151 00:12:03,840 --> 00:12:07,639 smoke together, won't they. Yeah, I believe that. Uh, you 152 00:12:07,679 --> 00:12:11,159 know, the dollar is the king, it's you know, there's been a 153 00:12:11,159 --> 00:12:13,480 lot of talk at d dollarization. I think that that's a process that has 154 00:12:15,000 --> 00:12:18,759 started in earnest. It will take quite a while for that to manifest fully, 155 00:12:18,679 --> 00:12:22,840 probably ten twenty years, to be honest, unless I'm wrong, but 156 00:12:22,120 --> 00:12:26,919 I do think I don't think the system can stay intact that long. The 157 00:12:26,960 --> 00:12:35,399 way we're going now with debt and the continuing loss of purchasing power dilution of 158 00:12:35,519 --> 00:12:39,320 value of the currency, is we print more and more of it and increase 159 00:12:39,399 --> 00:12:43,840 our debt. I mean, what was global debt was one hundred and fifty 160 00:12:43,840 --> 00:12:48,519 percent of global GDP twenty ten, and now it's two hundred and fifty percent. 161 00:12:48,519 --> 00:12:52,679 It's it's a worldwide problem, and it will blow up fiat currencies. 162 00:12:52,399 --> 00:12:58,600 Hey, So one final buspin for you, the future of the backing currencies 163 00:12:58,720 --> 00:13:03,360 with the precious medals. It's the last thing the politicians ever want to do 164 00:13:03,399 --> 00:13:07,240 because that will take away their power. Is it inevitable or will they keep 165 00:13:07,320 --> 00:13:11,320 fighting it to the very end? Well, I would love to see that. 166 00:13:11,320 --> 00:13:16,320 That would put the gold price in anywhere between ten thousand and fifteen thousand 167 00:13:16,360 --> 00:13:20,600 dollars announce and higher. If it were to fully back the dollar or other 168 00:13:20,759 --> 00:13:24,240 currencies, I think we might see a partial backing of something like the Chinese 169 00:13:24,279 --> 00:13:28,799 you want. I sadly don't think that we'll get to that point where gold 170 00:13:28,840 --> 00:13:33,200 backs a currency anymore, because you said it. It takes the power out 171 00:13:33,240 --> 00:13:35,960 of the politician's hands, and they're going to hang onto that power as long 172 00:13:35,960 --> 00:13:39,279 as they can. And I'm really afraid they'll blow up the dollar and the 173 00:13:39,320 --> 00:13:41,799 financial system of the process. It's not a happy thought, but it's a 174 00:13:41,879 --> 00:13:46,480 realistic one, I think. Date. I would just add to what you 175 00:13:46,519 --> 00:13:52,159 said. The politicians will absolutely fight it to the very end until they have 176 00:13:52,320 --> 00:13:58,159 absolutely no choice. There's no other option. Because look, any fee out 177 00:13:58,200 --> 00:14:05,000 system relies upon confidence. And I always say the root called the root of 178 00:14:05,080 --> 00:14:09,159 the word confidence as con right. So once the con is over, that's 179 00:14:09,200 --> 00:14:13,000 the end of the confidence, right, Yeah, exactly, And we are 180 00:14:13,080 --> 00:14:16,679 headed that way. And you know, in a fractual banking system, I 181 00:14:16,679 --> 00:14:20,399 mean it's been exposed with these bank failures that we've had. You know how 182 00:14:20,440 --> 00:14:26,360 thin this system really is, and you know, the pressures from the dead 183 00:14:26,639 --> 00:14:33,200 and these higher interest rates are just revealing the fragility of the system, and 184 00:14:33,919 --> 00:14:39,519 we cannot just continue to add another five ten trillion dollars to our dead without 185 00:14:39,600 --> 00:14:43,559 creating some other unintended, unintended consequences, one of which will be the end 186 00:14:43,600 --> 00:14:48,320 of the dollars purchasing power at all. So true, a once upon a 187 00:14:48,399 --> 00:14:52,360 time of the reserve requirement at these banks, the amount of reserves they had 188 00:14:52,399 --> 00:14:58,440 to keep on hand or depositors was ten twelve percent. Now they've done away 189 00:14:58,480 --> 00:15:01,919 with that since the last finance crisis. There is no reserve requirement, which 190 00:15:01,960 --> 00:15:09,519 means infinite hyper hyper leverage, hyper hypothfication, all that good stuff. Data 191 00:15:09,519 --> 00:15:11,000 and just tell us where do we find you? How do we connect with 192 00:15:11,080 --> 00:15:16,360 you? Find you work well? My company is American Gold Exchange. We're 193 00:15:16,360 --> 00:15:20,639 located in Austin, Texas. We're a national physical precious metals and vintage US 194 00:15:20,720 --> 00:15:31,240 gold coin dealership. Our website is www dot A M E Rgold dot com, 195 00:15:31,320 --> 00:15:37,200 amaregold dot com. Our general email address is info I NFO at amergold 196 00:15:37,240 --> 00:15:39,440 dot com and if you want to take a look at our website, we 197 00:15:39,480 --> 00:15:45,639 have live transparent pricing. We're very competitive, have an impeccable reputation in the 198 00:15:45,759 --> 00:15:48,279 national market for forty years, so we'd love to try and help people if 199 00:15:48,279 --> 00:15:52,600 they're interested in physical precious metals. That's what we do, all right. 200 00:15:52,679 --> 00:15:54,279 Hey, we appreciate you coming on. If you've got a question for data 201 00:15:54,399 --> 00:16:00,559 myself, email addresses k l at Kerreluts dot com. You'll find the link 202 00:16:00,639 --> 00:16:04,600 to a marigold in the show. That's this interview on Financial Survival Network dot 203 00:16:04,639 --> 00:16:07,559 com. Just click through. While you're there, sign up for your free 204 00:16:07,559 --> 00:16:11,159 NEWSLETTERDA that a real pleasure will have you on again. Thanks so much, 205 00:16:11,360 --> 00:16:15,240 Thank you, Carrie, it's pretty pleasure speaking with you today. Best wishes, 206 00:16:15,720 --> 00:16:21,360 thanks for listening to Carrie Letz's Financial Survival Network, your solution to today's 207 00:16:21,440 --> 00:16:26,360 trying times. For the latest, go to Financial Survival Network dot com. 208 00:16:26,360 --> 00:16:30,159 Financial Survival Network now more than ever.