/biz/ - Business & Finance

https://www.myrmikan.com/pub/Myrmikan_Research_2022_07_13.pdf
>We are now seeing the familiar pattern playing out again: costs are increasing,
operating margins are tightening, gold and the miners are being sold off as the world
heads into the next liquidity crunch. We know what comes next. The Fed must print, and
gold and gold miners will respond first and fastest.

>The next innovation will be
to buy stocks, as Janet Yellen has proposed and as the Bank of Japan does already.

>When the world losses confidence in the Western banking system, perhaps as soon
as this winter when Europe will face economic and political collapse because of the
conflict with Russia, the Fed will be forced to print more and faster, and there will be runs
on central banks. There are no liquid assets on these balance sheets that can be sold to
support the currency.

>Gold will trade at a price that balances central bank balance sheets. In order for gold
to back the Fed’s liabilities by a modest one third, it would currently require a price above
$11,000/oz. Since markets always overshoot, $17,000, or half-backing, is a more reasonable
target (the peak price in 1980 resulted in an absurd 133% backing, which today would
translate to $45,000/oz). This assumes no growth in the Fed’s balance sheet.