Economics Explored

Is Gold Flashing a Warning Sign? ep303

Episode Summary

Gold has doubled in price in less than two years—so what exactly is happening? Gene Tunny and John Humphreys break down the economic and geopolitical forces driving the surge, from inflation fears and rising global debt to BRICS nations buying massive amounts of gold. The conversation also explores whether a new gold-backed currency could challenge US dollar dominance.

Episode Notes

Gold has doubled in price in less than two years—so what exactly is happening? Gene Tunny and John Humphreys break down the economic and geopolitical forces driving the surge, from inflation fears and rising global debt to BRICS nations buying massive amounts of gold. The conversation also explores whether a new gold-backed currency could challenge US dollar dominance.

Gene would love to hear your thoughts on this episode. You can email him via contact@economicsexplored.com. 

Time stamps

00:00 – Introduction
01:30 – Why gold is surging
04:30 – The role of inflation fears & global debt
07:15 – BRICS gold buying and the idea of a gold-backed currency
12:00 – Is a gold-backed currency workable?
16:00 – Gold vs. fiat currencies: long-term stability
22:30 – Geopolitical implications of a shift away from the USD
26:00 – Gene’s clarification of Ken Rogoff’s perspective
28:30 – Outro 

Takeaways

  1. Gold has doubled in price in under two years, suggesting deep market concerns about inflation, debt, geopolitics, or structural distrust of fiat currencies.
  2. BRICS nations—particularly China—are buying unprecedented amounts of gold, possibly preparing for a commodity-backed settlement currency.
  3. A gold- or commodity-backed currency is politically useful for BRICS, as it may help overcome trust deficits relative to the US.
  4. Gold standards constrain monetary policy, reducing the ability to monetize debt or respond flexibly to recessions. Gene and John debate whether this constraint is feature or bug.

Links

Gold charts:
https://drive.google.com/file/d/1TamqJ1GOpXxveAVLRS0UJnb7U9GyRATX/view?usp=sharing

ATA livestream on 6 November:
https://www.youtube.com/live/gSVJ9ZU6lC4?si=8sXvajwG5cdUk85f

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