Why I think gold/oil ratio will go to 100+ over time

Summary

The speaker discusses the current economic landscape, focusing on issues like debt, negative real interest rates, and the U.S. government's inability to make its fiscal policies work without these conditions. They stress the importance of gold as a safe-haven asset, suggesting that once gold's value aligns with a more sustainable economic structure (around $10,000-$12,000 per ounce), they would consider transitioning into long-term treasuries. The speaker encourages viewers to explore their website for insights on economic trends and analysis through their 'tree rings' product.

Takeaways

• 😀 The U.S. government's financial system struggles to make the math work without negative real interest rates.
• 💰 The speaker believes gold should be priced appropriately relative to the dollar, potentially as high as $12,000 per ounce.
• 📉 The current state of long-term debt makes it unattractive to hold until the dollar is correctly valued against gold.
• 💡 The speaker suggests that once gold reaches the right price, they would be open to moving gold into long-term treasuries offering yields of 3-4%.
• 🔄 There is an expectation of a reset in the financial system once gold prices are properly aligned with the dollar.
• 📈 The speaker envisions a future where gold prices rise significantly, indicating potential changes in the global financial system.
• 🏦 The idea of reinvesting gold into U.S. treasuries is presented as a beneficial strategy after gold reaches a high valuation.
• 💭 There is a focus on the importance of understanding how global debt and the value of gold affect long-term financial decisions.
• 🌍 The speaker notes that these economic conditions are likely to change, but the long-term outlook will be shaped by these reset conditions.
• 🎧 The speaker encourages the audience to check out fft-lc.com for further insights and updates about their tree rings product and related topics.

Q & A

What is the speaker's view on the current economic situation and debt in the US?

The speaker believes that the US government is unable to manage its debt properly without relying on negative real interest rates, which they see as unsustainable and problematic for the economy.

What is the speaker's perspective on gold in relation to the US dollar?

The speaker views gold as a key asset and suggests that once the dollar is appropriately priced against gold, they would be happy to invest in long-term treasuries, indicating a shift towards gold being a benchmark for evaluating the US dollar's value.

How does the speaker envision their future investment strategy regarding gold and treasuries?

Once the price of gold reaches $10,000-$12,000 per ounce, the speaker plans to sell some of their gold and move their investments into long-term treasuries yielding around 3-4%, signaling a shift in investment strategy when conditions align.

What role does negative real interest rates play in the speaker's analysis?

Negative real interest rates are a central issue in the speaker's analysis, as they believe that these rates are a symptom of the government's inability to manage its debt effectively. They argue that negative real interest rates are not sustainable in the long term.

What does the speaker mean by 'resetting' the economy?

The 'reset' the speaker refers to likely involves a shift in the financial system where the dollar is revalued against gold, and new economic conditions allow for stable, sustainable investments, particularly in treasuries.

Why does the speaker suggest they would be happy to sell their gold at $10,000 per ounce?

The speaker sees this price as a signal that the dollar has been appropriately priced relative to gold, which would mark a turning point for them to start shifting their investment strategy towards safer assets like long-term treasuries.

What is the purpose of the speaker mentioning their website, fft-lc.com?

The speaker mentions their website as a resource for more information about their 'tree rings' product and to share a summary of their insights on current trends and how they are shaping their views on the economy.

How does the speaker view the relationship between the dollar and long-term treasuries?

The speaker indicates that once the dollar is properly priced against gold, they would feel comfortable investing in long-term treasuries with stable yields (3-4%), suggesting that the economic conditions would be more favorable for such investments.

What does the speaker imply about the current state of the US debt?

The speaker implies that the US debt situation is precarious, with the government unable to resolve it effectively, leading to the use of negative real interest rates as a temporary solution.

What is the significance of the speaker's final message to the audience?

The speaker's final message conveys a sense of optimism about future economic conditions and encourages the audience to stay informed, while also wishing them a pleasant rest of the week and summer, creating a personal and positive closure to the discussion.