Gold continues to move off late March double bottom; ‘the last thing I care about is the price’ – Grant Williams on gold

(USAGOLD – 4/8/2021) – Gold continued to move off the late March double-bottom assisted by yesterday’s release of Fed minutes reflecting an overall dovish tone among Fed governors. That dovish tone carried over to media interviews of various Fed governors yesterday. The yellow metal is up $12.50 in early trading at $1751. Silver is up 28¢ at $25.49. The precious metals are also getting a boost this morning from a sharp drop in the dollar and steady yields. The 10-year Treasury is trading at 1.66% well off its recent 1.75% high. I happened to catch a fascinating On the Margin video interview of Real Vision’s Grant Williams yesterday in which he laid out his philosophy on gold ownership and expressed views on several other issues of consequence to precious metals investors. Some might recall Williams as the writer and editor of the popular investment letter, Things That Make You Go Hmmm.

“The last thing I care about is the price,” he says, “I know that no matter where the gold price is trading over time relative to other assets, it’s going to preserve my purchasing power, and that’s really all I care about. I just don’t want my money being worth less because of inflation, because of governments, because of all the things that they are required to do to keep the system together. You know, when a government tells you they are going to target 2% inflation, they are telling you our aim is to reduce your purchasing power by 2% a year, and that compounds very, very quickly. … I never think about the price level where I would sell my gold, I think about a point in time where I might decide that the gold I have in that safe deposit box, I would prefer to own that piece of land with it.”

Chart of the Day

line chart showing the Bank of England's balance sheets assets as a percent of GDP 1700 to present

Sources: St. Louis Federal Reserve [FRED], Bank of England; Board of Governors, U.S. Bureau of Economic Analysis

Chart note: This chart of the total assets held by the Bank of England as a percent of GDP from 1700 to present, shows at a glance the extraordinary situation in which the central bank finds itself as a result of the coronavirus-related economic crisis. The BoE is also attempting to cushion the fallout from UK’s departure from the European Union. We should add that BoE is not alone in pulling out all the stops. The U.S. Federal Reserve is charting a similar course as are most of the major central banks around the world.

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