Daily Gold Market Report

Unsustainability of Rapid Debt Increase
Gold’s Protective Role

(USAGOLD – 10/5/2023) Gold is down from yesterday’s close. Gold is currently trading at $1815.62, down $5.74. Silver is trading lower at $20.93, down 7 cents. The US’s debt spike by $300 billion within 5 days is alarming. Two weeks prior, the total US debt reached the $33 trillion mark, a historic first. This rapid rise suggests an imbalance between expenditure and revenue, potentially shaking investor trust in US securities. As confidence wanes, borrowing costs could soar, and the government’s ability to manage economic downturns may be hampered due to a significant chunk of its revenues being tied up in debt servicing. The Fiscal Responsibility Act of 2023 was signed into law in June which eliminated the debt ceiling through January 1, 2025. At the current quarterly debt issuance pace, the US is projected to reach $40 trillion in total debt by the close of 2025.

USAGOLD Comment: In times of fiscal instability, gold shines as a steadfast asset. Unlike fiat currencies, which can be devalued when governments overspend, gold’s intrinsic value remains. As traditional assets wobble during debt crises, investors often flock to gold, seeing it as a bulwark against wealth erosion and financial turbulence.