Stansberry Research recently spoke with Mark Yaxley about the decline in precious metal prices and gold prices around the world. Why does the value of gold go down when the dollar appreciates?

The managing director of the precious metals company Strategic Wealth Preservation believes that the Fed’s aggressive policy of raising interest rates is causing the value of the dollar to rise. 

Is gold the same price around the world?

Because prices in the precious metals market are denominated in dollars, the price of gold falls while the dollar rises in value, the expert said: 

“The stronger the U.S. dollar, the fewer U.S. dollars it takes to buy one ounce of gold[…] That’s really the main factor, and that’s what investors should be paying attention to.”

Yaxley doesn’t think investors should panic over falling all world gold price lists and assures that the precious metal will eventually recover. He went on to say the following:

“It’s not the end of the world. The gold situation is not like a bitcoin crash. We haven’t lost half of our investment. It’s a healthy correction, and these things happen sometimes.”

He urges investors to buy gold now, while it’s still cheap, to profit when the trend reverses up, “Gold and silver always serve their purpose in the end, but you have to give it time. That’s why patience is required.”

As for gold prices all over the world manipulation in the precious metals market, he said that manipulating “paper” gold is “unfortunately part of the banking culture.” He said it will be difficult to replace banking titans like JPMorgan, which has recently been accused of manipulating gold and silver prices.

Fed policy

Kitco News interviewed Frank Holmes, during which they discussed the climate agenda and the Fed’s monetary policy after President Joe Biden announced last Wednesday new programs to combat climate change, including $2.3 billion to help people upgrade buildings and expand flood protection. 

But the “emotional” response to climate change has weakened economic growth and caused inflation, U.S. Global Investors CEO and executive coordinator of HIVE Blockchain explained in an interview. “Climate change is essentially perpetuating inflation,” Holmes said. 

“Much of it has to do with energy inflation in Europe, the panic closures of nuclear power in Spain and Germany, and taxing cars and trucks.”

Holmes expects the U.S. Federal Reserve to reverse course on tightening monetary policy and cut interest rates by the end of November this year. There have already been protests around the world over rising prices and concerns about the cost of living. According to the expert, the civil unrest could prompt the Fed to cut rates: 

“All that’s going to happen is a big protest, and not just in Europe. […] It’s a trend that’s happening in countries all over the world.”

He said he expects the U.S. Federal Reserve to hit the “panic button” and ease monetary policy “by Thanksgiving.” Holmes tracks the Manufacturers’ Manufacturing Index (PMI), which he said is a leading indicator of the overall health of the economy. “The PMI is declining all over the world,” he explained. “If the world economy suddenly starts contracting, the ‘panic buttons’ will go off and more money will be printed.”