With Joe Biden in the White House and Democrats controlling both houses of Congress, it seems pretty certain we’re going to get a federal $15 an hour minimum wage. In this episode of the Friday Gold Wrap podcast, host Mike Maharrey discusses the economic ramifications of minimum wage laws. Hint — they are not good. He also talks about Fed Chair Jerome Powell’s comments this week and why they should make you even more bullish on gold.
Last month, we reported on signs of revival in the Indian gold market. Gold imports hit a 19-month high in December.
That revival has continued into 2021. Gold imports in January were up 72% year-on-year, and some shifts in government policy could give demand another shot in the arm.
On Wednesday, Federal Reserve Chairman Jerome Powell called for a “society-wide” commitment to reaching full employment, calling for “contributions from across government and the private sector.” He said getting people back to work would require “continued support from both near-term policy and longer-run investments.” He also dismissed concerns about debt saying the focus needs to be on the economy’s immediate needs. As Peter Schiff put it in his podcast, Powell handed the US Treasury a blank check.
Silver got a brief boost when the Reddit Raiders turned their attention to the white metal. The online investors weren’t able to pull off a short-squeeze in the silver market, but we’ve said all along that there are fundamental reasons to be bullish on silver, the attention of Reddit Raiders notwithstanding.
New demand projections for silver in 2021 bear this out. Silver demand is expected to rise 11% this year and reach 1.025 billion ounces, according to the Silver Institute’s forecast.
So, what’s wrong with stimulus, money printing, trade deficits, and the minimum wage? Peter Schiff appeared on Meet Kevin to tackle these questions and more.
In a podcast, Peter Schiff said it smells like stagflation is on the horizon. Inflationary pressures are becoming more and more apparent. Labor costs, commodity prices and bond yields are all pushing upward – clear signs of inflationary pressure. And of course, defined correctly – as an increase in the money supply – there is no denying inflation is rampant. We saw a record increase in the money supply last year. The only time that even comes close was the stagflationary period of the 1970s.
But what does this really mean for you and me?
We ended last week with some weaker than expected economic data – particularly the jobs numbers, but the stock market continues to go up. These days, the mainstream reacts to everything as good news. No matter what the data suggests, everybody seems to think things will come up smelling roses because of stimulus. But in a recent podcast, Peter said all of this smells more like stagflation.
After two consecutive months of outflows, gold-backed ETFs became net buyers of gold again last month. Gold-backed funds added 13.8 tons of gold to their holdings globally, driven by inflows in Europe-based funds, according to the latest data from the World Gold Council.
The tale of GameStop has much more to say about the current state of investing.”
The central idea in the classic Mel Brooks comedy “The Producers” is that unscrupulous Broadway impresarios could succeed fabulously by creating a play so uniquely awful that it would close on its first day. Their idea was to oversubscribe shares to investors, to the point where hundreds of percentages of ownership could be claimed. But if the show failed spectacularly, there would be no proceeds to fight over, all the investors would accept that their shares were worthless, and no one would know that they had been conned. The producers could pocket the excess money. The only way they could fail would be by producing a hit.
Over the years, I’ve done a number of Fun on Friday posts about eating gold. You can have gold on your steak, on your desert, and even in your beer. Well, apparently some ancient Egyptians wanted the taste of gold in their mouths for all eternity. Archaeologists recently discovered a 2,000-year-old mummy with a gold tongue at an ancient Egyptian site called Taposiris Magna.
