Gold at low end of seesaw market action this morning

(USAGOLD – 8/15/2019) – Now down $5 on the day at $1512, gold is on the lower end of a seesaw performance that began in overnight trading and carried over to the open in New York. Silver is off 6¢ at $17.18. The markets, in general, seem to be taking a bit of a breather after yesterday’s strong reaction to the rate inversion in two and ten year Treasury debt. Overall, the same four horsemen threats of recession, plummeting yields, currency depreciation, and stock market instability continue to drive interest in gold and silver and bolster global demand.

It wasn’t all that long ago that calls for $1500 gold were greeted with a considerable amount of skepticism. Now with $1500 gold a reality, some analysts are eying the potential for gold reaching another milestone – $2000 per ounce. In a recent CNBC interview, TD Securities’ Daniel Ghali and Bank of America Merrill Lynch’s Michael Widmer both said $2000 gold could materialize the result of unconventional, aggressive easing on the part of central banks. In a Bloomberg interview yesterday, BOAML’s chief technical analyst, Paul Ciana, outdoes them both by forecasting the yellow metal could “go as high as $2300 per ounce” in the years to come based on technical wave structure analysis that had its beginnings in the 1970s.

Quote of the Day
“Why does the cycle move as it does? What causes these periodic alternations, this ebb and this flow, in the national priorities? If it is a genuine cycle, the explanation must be primarily internal. Each phase must flow out of the conditions – and contradictions – of the phase before and then itself prepare the way for the next recurrence. A true cycle is self-generating. It cannot be determined, short of catastrophe, by external events. Wars, depressions, inflations may heighten or complicate moods, but the cycle itself rolls on, self-contained, self-sufficient and autonomous. . .The roots of cyclical self sufficiency lies deep in the natural life of humanity. There is a cyclical pattern in organic nature — in the tides, in the seasons, in night and day, in the systole and diastole of the human heart.” – Arthur M. Schlesinger, Jr., The Cycles of American History

Chart of the Day

Chart note:  This chart depicts U.S. government receipts and expenditures from 1950 to present.  Note the growing gap between incoming and outgoing – the difference for the most part filled by additions to the national debt.  Given the established trend, that gap in all likelihood would have continued widening without the imposition of the new tax reduction program and simultaneous growth in government spending.  With tax reductions now in place, the distance between the two lines is likely to widen even further.  This is the second last installment in our series on the national debt.  Tomorrow, we will post the final entry.

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