A Dark Shadow Lights Up the Gold Market
Historically the price of gold rises when there’s an increasing percentage of federal revenues going to pay interest on the national debt and…declines when US interest payments move down as a percentage of federal revenues. [Given what is currently unfolding,]…the forecast for the price of gold is simply up, up and away. [Let me show you in graphic form.] Words: 451
So says Byron King (www.dailyreckoning.com) in excerpts from an article* which Lorimer Wilson, editor of www.munKNEE.com (It’s all about Money!), has further edited ([ ]), abridged (…) and reformatted below for the sake of clarity and brevity to ensure a fast and easy read. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement. King goes on to say:
Below is a chart that shows the percentage of US government income that goes to pay interest on the national debt and the historical price of gold in real terms.
Before 2010, the [above] chart uses historical data for both gold and the percentage of revenues going to pay interest. In the years ahead, the interest payments are an estimate based on known outstanding US debt. [As can be clearly seen] the anticipated rates…[and] interest on the debt will eat up more and more of the overall federal revenue stream…because national debt and interest on that debt are growing far faster than taxable GDP. [As such,] we’re staring at the potential for utter economic devastation. If you’ll grant me a bit of artistic license in all this…life as we know it in the U.S. could come to a crashing halt.
From the standpoint of investing, the chart also gives us every reason to anticipate even higher prices for gold, and, by association, silver so if you don’t have some gold and silver, get some.
By 2020 we may be living in a country where the government is chronically insolvent due to interest payments, and gold is going stratospheric. We’ll enter into an era when the government won’t pay its day-to-day bills on time, if it pays them at all. Eventually, we may see the U.S. currency in free-fall, if not collapse, and that is why:
Your ONLY real long-term hope in all of this is to invest in “real” assets – things that will retain value over time – [such as] energy and minerals, and particularly… physical gold and silver…
- The above article consists of reformatted edited excerpts from the original for the sake of brevity, clarity and to ensure a fast and easy read. The author’s views and conclusions are unaltered.
- Permission to reprint in whole or in part is gladly granted, provided full credit is given as per paragraph 2 above.