Interest Rates

Stocks and government-issued currencies fell this week, while bonds and commodities were mixed. The largest gains were once again in Bitcoin, which rose 11.1% to 29.3 grams, now approaching parity with one ounce of gold. Gold stocks fell more than any other asset-class, dropping 4.7% to close at 5.1 grams.

More on Weekly Update 24 Feb 2017

This was a good week for stocks, but mixed for bonds and commodities. The big winner was the Euro STOXX, which gained 6.3% this week on news that the European Central Bank will be extending its low interest rate policy and expanding its quantitative easing programs. US stocks also rallied on the news. Coffee dropped again this week, falling a further 3.6%, the largest loss of any asset class.

For more on currencies, stock markets, bonds and commodities, and for a look back at results for the last year, check out the whole article!


This podcast is a continuation of my 30-July-2015 interview with Keith Weiner, CEO of Monetary Metals and president of the Gold Standard Institute USA.

In the first part, we discussed the ultimate fate of the dollar. In this episode, we look at the true purpose of the Fed, the limits of central bank power, and then examine investments and speculations that allow us to profit from today's economic situation.

Audio MP3

Download Podcast Part 2 (54:12, 26 MB)

More on Podcast: Gold, Yield, and the End of the Dollar – Part 2


This podcast is a recording of a conversation I had on July 30th with economist Keith Weiner, CEO of Monetary Metals and president of the Gold Standard Institute USA. We intended to chat for about 20 minutes, but wound up talking for almost an hour and a half! Due to the length, I’ve broken it up into two parts.

More on Podcast: Gold, Yield, and the End of the Dollar – Part 1


Recently, I got a great question about compound interest.  Everyone is taught the power of compounding… Usually the story goes something like "If you invested $1,000 in 1900 at 5% compound interest, it would be worth $236,000 today!".

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I got a great question in my email this morning, and I'd like to share it, and my answer, with you.

Using your methods, how can one know when gold and silver are grossly overvalued? Much like the tech stocks around 2000-2001?
I don't think of it in quite those terms… I use gold as the unit of measure, and thus see it as unchanging.  The USD may rise and fall, silver may rise and fall, but gold is my constant, like cash.
If you put 1kg of gold in a safe for 10 years (or 100 years!), you will still have 1kg of gold.  No gain, no loss. Put enough $100 bills to buy 1kg of gold in the same safe, and you will probably not be able to buy anything close to the same amount of stuff with it in 10 or 100 years (if the bits of paper have any value at all!)
So taking the US Dollar first, your question would be translated as "how can one know when the dollar is grossly overvalued, much like the tech stocks in 2000-2001?"  If that time comes again, you will want to sell your dollars and go to cash (gold), just as in 2000-2001.  Conversely, we could get a bottom in the USD, as in 1980, and it might become a good long-term speculation.  I don't think that is anywhere close yet.  And there is a real possibility that the USD will continue to fall gradually for a long time, or suddenly fall a lot, or even be replaced by some other monetary unit leading to a near-zero value… so I see buying dollars as a risky speculation, but one that could be quite profitable from time to time – as indeed it has been for the last 12 months or so.
My favorite tool is the "half-life of the dollar chart".  When I see the USD moving below the half-life curve significantly, say by 10%, I start paying attention. If it starts to recover, you could be entering a period of mean reversion that would make the USD a good buy.  The main fundamental that is likely to drive the USD up would be positive and rising real rates of interest.  When the bond vigilantes ride again, it might also be time to buy USD, at least for a medium term speculation. As long as the Fed is holding interest rates low, and concern about the economy and deflation is strong, I think you are better off in cash (gold), since the Fed will be using various tricks to increase the money supply to fight these perceived threats.
Silver is a different animal; I see silver as primarily an industrial metal, with a secondary monetary appeal to smaller savers.  As such, it is quite volatile, but unlike the USD, will never be without value – and is thus a less risky speculation than the dollar.  My suspicion is that either the economy will need to improve dramatically, or the USD will need to tank, for silver to show real strength.
I hope this is helpful!
Sir Charles

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Market Update, 29 Jun 2012

This week saw a reversal of last week's trend, with almost all investment categories showing losses.  Currencies and bonds were all lower, on news of new European bank bailouts and fears that next week will bring further easing from the ECB and Bank of England.  Most stock markets were also lower, with the Japanese Nikkei, up 0.6%, being the exception.

More on Market Update, 29 Jun 2012


On May 31st, Dr. Marc Faber, one of my favorite economists and a very engaging speaker, gave a landmark presentation at the Mises Circle on Austrian Economics and Finance. In this talk, Dr. Faber details the coming economic catastrophe, and what to do about it.

More on We Are Doomed

I think it's time we all switched to using gold as our unit of account, as the fiat currencies of the world continue to be consumed in a firestorm of inflationary "money" creation. Whether or not we hold actual physical gold (which we should, as our bedrock cash position) we should be seeking to own stuff that is rising in value in gold terms. The real problem is that the signals we get from investments priced in EUR, USD, JPY, etc. are being seriously distorted by the massive issuance of these currencies, resulting in investors continuing to hold them and even add to them, believing their value is rising when it is in fact falling.

More on US Treasury Bonds Collapse

Gold is a type of money, just like Dollars, Euros, Pounds and Yen. Unlike these other forms of money, gold has been around for thousands of years, while many fiat systems have come and gone. Because the amount of gold in the world cannot be increased without finding and mining more of it, its value is fairly constant. This is in stark contrast to the fiat monies which can be created on command by governments and central banks.

More on Gold and the Financial Crisis