BRICS vs. The Dollar: A Gold-Backed Currency on the Horizon?
This week’s financial news is packed with surprises and interesting trends. The top stories in the financial world showcase the ever changing and uncertain nature of the industry.
Let’s dive in!
📈 Inflation remains lower than expected in June, with the Consumer Price Index (CPI) showing a modest increase of just .2%. However, it’s crucial to note that the CPI doesn’t include essential items like food and electricity, which have seen significant year-over-year price hikes of 5.7% and 5.4% respectively.
💰 Brace yourselves for this one — the federal budget deficit has surged 64% over the past year, hitting a whopping $2.3 trillion. That’s more than double what it was before the pandemic. Yikes!
🤑 Time to talk treasure! A Kentucky man made an extraordinary discovery known as the “Great Kentucky Hoard.” This lucky guy recently discovered a treasure trove of over 700 rare gold coins in his field. Some of these coins from the mid-1800s have already been sold for six-figure sums at auctions. This remarkable find could potentially be worth millions of dollars. Jackpot!
🗺️ India is projected to overtake the United States as the world’s second-largest economy by 2075. Currently ranked as the fifth-largest economy, India’s GDP is forecasted to experience substantial growth, driven by its population of 1.4 billion people, ultimately surpassing other economies.
💸 Florida is grappling with high inflation rates, leading the nation, with a cost of living rising at over twice the national average of 3%. Cities like Tampa and Miami are experiencing inflation rates of 7.3% and 6.9% respectively, outpacing other metropolitan areas.
The U.S. dollar has recently plummeted to its lowest level in over a year, signifying a significant downturn.
This downward trend may persist as the real yield curve flattens, according to Bloomberg strategist. The real yield curve serves as a leading indicator for the dollar and is influenced by the real return of foreign investors in U.S. yields.
Market speculators anticipate eventual rate cuts, expecting these changes to occur around 2024. A weakened dollar could have global ramifications, potentially reducing import prices for developing nations and boosting currencies like the yen.
The future trajectory of the dollar remains uncertain, and concerns arise amidst the growing number of countries seeking to reduce their reliance on the dollar.
Speaking of currencies, the BRICS nations (Brazil, Russia, India, China, and South Africa) are up to something interesting. As Robert Kyosaki points out, they’re planning to introduce a new gold-backed trading currency to challenge the dollar’s supremacy.
Over 30 countries are showing interest in joining their alliance, so things could get quite exciting in the international financial arena.
While the idea of ‘de-dollarization’ was once deemed unlikely, a gradual shift away from the U.S. dollar or the emergence of an alternative now seems not just possible, but inescapable.
However, the implementation of a gold-backed currency poses significant challenges.
With the scarcity of gold compared to the vast amount of global currency, it would be virtually impossible to establish such a currency at current gold prices. Increasing the price of gold a lot higher would be necessary to accommodate a gold-backed currency, but this presents its own set of obstacles.
If you’re considering investing in physical gold or silver, timing your purchase becomes crucial.
Check out my article on why $5,000 Gold is on the horizon:
Analyzing historical data since 1975, we find that gold tends to experience a surge in the early months of the year, followed by a slowdown in spring and summer before picking up again in the fall. In the third quarter, specifically July through September, has historically been the strongest period for gold.
While considering the price of gold is important when making a purchase, it is equally crucial to focus on the number of ounces you own. Owning a meaningful portfolio of gold has proven to be one of the best ways to safeguard against significant losses during times of crisis.
Given the historical trend of July being a prime opportunity to invest in precious metals, why wait? Seize the golden opportunity now!
