2020 on GOLD: time is running out

And so here we are in the year 2020.

A year that I have often referred to in my work over the past 10 years here on DeshGold.com. I'll explain why.

A year that, from my long-term research on the precious metals market, has enormous potential to set an important maximum.

When it comes to highs, in a world based on an inflationary monetary system like ours, it is important to understand what we are talking about.

If you think of the great trends of history, I speak of decades or hundreds of years, you discover that in a world where the prices of all things constantly rise over time, the maximums are points destined to be almost always exceeded.

Unlike the historical lows, which are points that are much more likely not to be broken lower.

Think a little bit about the minimum that the DowJones did in 1932 at 41 index points. Today we are at 28900 points.

That minimum there, in the life of the DowJones, is extremely likely that it will never be touched again.

Otherwise, any major high that the stock market has made in the past 100 years, even the historic one from 1929, at some point was broken upward

The heart of this speech lies in the devaluation of the fiat currency.

Euros, dollars, pounds, any " money " in the world is constantly devalued.

It is as if a farmer had the gift of being able to snap his fingers and drop as many apples from his trees as he wishes.

The more apples there are in circulation, the lower the value of each individual apple will be. It is the law of supply and demand baby.

2020 on GOLD: time is running out

What if tomorrow the farmer snaps his fingers and rains millions of apples from his trees?

It happens that with so many apples around, and without an equally increased demand for apples from those who eat them, each apple will be worth less than yesterday.

Obviously, an equity index can rise in price also due to the growth in value of the companies that make it up.

But the point is that, if on the one hand the growth of the value of the companies we can question it (at least 10 years that the growth is slow), what you are certain of is that the central banks will continue to flood the apple market .

Why can you be so sure?

Simple: because if they didn't, given the point where this system is located, everything would collapse within 24 hours. It would be like going back to the Middle Ages.

Returning to the present day. And going back to the gold market ...

... 2020 has great potential to set maximum gold over an 8-year cycle. A cycle that started in December 2015 and which is slowly becoming mature to generate its maximum.

This high will have the strength to push prices down for a while.

Probably several months. Maybe even 1-2 years old. Then it will give way to new highs because the gold market is also influenced by the inflationary system in which we live today.

At best, the maximum of this cycle could arrive in 2021, even if it is statistically less probable.

Yet this is only one side of the coin.

The other side, the most important for those who understand the profound meaning of the word value , is that 2020 also has great chances of printing a maximum on gold in terms of purchasing power.

To understand the purchasing power of gold, you need to relate its price to the price of other things.

The most widespread relationship is that between gold and the American stock market.

If you look at the relationship between DowJones and Gold, you discover that from a certain point in 2018 gold has returned to appreciate not only in fiat currency but also in terms of the stock market.

If you don't learn to calculate the real value of a stock market chart, you will continue going overboard when there is nothing but fog around you.

You will not be able to see anything.

Just haze, smoke in the eyes, a vision dispersed in the gray of the fog.

As I have repeatedly shared during the ImpattoReale events , the winter of the Kondratieff cycle began between 1999 and 2001.

The Kondratieff cycle is the cycle that dictates the most interesting times of the mega-trends that develop on the financial markets in harmony with the average time of a human life.

To be clear, it is that cycle that starts multi-year trends, sometimes even over 10 years. These are the trends that change society (and even your life if you learn to recognize them and gallop yourself).

Today, as I write, we have entered the time when this cycle will change phase on the equity and the precious metals asset class.

This year 2020 has enormous potential to show us this reversal. At most, according to my calculations, this will happen in 2021.

And even if, at least for the moment, the most important minimum in the Dow / Gold ratio arrived in 2011, this does not diminish the importance of the minimum point that is going to be generated now on these two asset classes.

I have been writing for years that the price of gold in euro terms would have made an all-time high by the end of 2020.

Despite the fact that between 2013 and 2017 almost nobody believed it, the numbers today are there to show us that in 2019 gold in euro has made a new historical maximum.

In this 2020, if the maximum does not arrive in the first 3 months of the year (in this case the probability of exceeding $ 1,923 ounce will be recalculated), gold in dollars will also have great potential to show us a new historical maximum.

And if my calculations are correct, in this 2020, at the latest in 2021, DowJones and Oro will set the true secular inversion point. What many investors in precious metals would do well to make sure that they really understood how gold and silver move during the great mega-trends of history.