It has been another interesting week of intersection between God and Gold. Tuesday marked the most remarkable day of the year in the Orthodox calendar when God gave humanity one last crack at Paradise. The Holy Spirit proposed to the now widely beloved, teenage Jewish girl and she said yes despite her fear that it would lead to her execution. The marriage was consummated, the Messiah was conceived and the salvation story went into overdrive.  

Since the founding of America when US citizens have caught glimpses of this same girl, be it President George Washington in Valley Forge, the famed Ivy League professor in New England, or the sawmill workers from Fort Worth, Texas, in each case those few moments with her were life-changing. And when she has been seen on Tuesday’s anniversary, like the story history’s most regal queens, she comes dressed in gold.

While US financial advisors continue to tell families that despite the laws of finance, and despite history, stewards do not need gold, heaven continues to weave physical gold and silver into the tapestry of life. Like the most extraordinary stories of life-saving protection from Europe during World War II, or stories from Asia as communism ensnared countless families, history’s most famous gold custodian, St. Joseph, likely used physical gold to protect the Holy Spirit‘s bride and the savior of humanity on his intercontinental expedition for the ages.

Since we last updated you, the headlines continue to hint that we may be living in the most opportunistic era of the last century in finance. If you did not see it, President Trump signed an executive order to accelerate America’s ability to extract crucial minerals. Gold was listed as crucial even though it has virtually no industrial use. Not coincidentally, China mirrored Trump’s move with a similar push as virtually the entire world save for Wall Street’s financial advisors position for a new financial paradigm.

China is now encouraging its insurance companies to also begin allocating to physical gold as it seeks to amass as much gold as possible within its borders and outside of the financial system. Americans need to consider that China is consistently one of the largest gold miners in the world and at the same time one of the world’s biggest importers of gold. We encourage you to think of one other time in history this duality existed. As if there was any doubt as to how critical Asia realizes gold will be in this emerging paradigm, China in most instances forbids the export of gold from its borders.

It has been encouraging to see regional US leadership pushing forward with diversifying public funds into gold and amending laws to encourage Americans to invest in gold. 

Utah announced it has become the first state in the nation, perhaps since FDR’s treasonous betrayal of the Constitution, to approve gold and silver payments with state vendors.  Utah also announced it has invested $60M of taxpayer money in gold, and hinted that it will continue to add to its gold position. Idaho also reaffirmed gold and silver as legal tender, i.e. money. So investors – realize either the world’s central banks, these states and history are correct that gold is money … or your finanical advisor is correct who tells you it is not.

Think hard about who you really want to bet with.

In the last 12 months, multiple states have also passed legislation ending sales tax on gold and silver and simultaneously ruled that central bank digital currencies are not money.

Perhaps most encouraging is that legislation has been introduced to remove federal income taxes on gold and silver, recognizing the metals are indeed America’s money as declared by our founding fathers. States including Alabama, Arkansas and Nebraska have already advanced similar bills to remove income tax at the local level from metals.

As of this month, Gold is outperforming the stock market on a short, intermediate and now longer-term basis. This is shocking as the entire purpose for owning stocks is to pursue higher returns that would justify the far greater risks of stocks relative to a defensive asset such as gold. If you care about your family’s financial future forget about what your advisor tells you about gold, and do your own research into the data.  Take just one hour comparing the returns and risks of gold, stocks, bonds and paper currencies. We fully expect you will put your pencil down and conclude that “near-zero percent allocations to gold may be in my advisor’s best interests, but not in mine.”

Equities have numerous newer headwinds gathering force as well.  Foreigners are repatriating capital out of the US as witnessed with Europe’s calls to withdraw funds from America. Trump has also moved to rescind taxation privileges to Chinese citizens, privileges Americans were not entitled to regarding stock ownership. This will likely pause incremental investments from Chinese investors as they lose their preferred status. Even Sell-side financial analysts who have been so late to raise gold target prices are now admitting it looks like $3,000 is emerging as support.  All of these factors contribute to liquidity in the stock market that is now at a multi-year low.

If you did not see it, the evidence is now so irrefutable that the US government has been hiding data on US mortgage bankruptcies that the NYT has conceded the truth of this reality. It is clear that the government has been subsidizing and propping up current real estate valuations with taxpayer funds.  Could the realization of residential housing vulnerability be why Buffett is trying to sell his massive US residential real estate holdings? Commercial Real Estate also continues to be priced in suspended reality as banks no longer adhere to traditional accounting standards as such standards would render many financial institutions insolvent. In all likelihood, more than $1 trillion in CRE needs to be repriced lower.

We encourage our clients to remember that consistently rising gold prices are history’s red alert warning that the value of a currency is eroding. The distinction that goods and services are not costing more, but that the dollar is buying less is critical to appreciate. As Warren Buffett said highlighting the futility of storing wealth in dollar-denominated assets such as T-Bills, CD’s, bonds, annuities and life insurance:

"Paper money can see its value evaporate if fiscal folly prevails. In some countries, this reckless practice has become habitual, and, in our country’s short history, the U.S. has come close to the edge. Fixed-coupon bonds provide no protection against runaway currency."

Recall that Buffett’s lifelong partner Charlie Munger admitted in an interview shortly before his death that their internal working thesis is that the dollar will become worthless.

Why is it that Buffett does not encourage people to allocate to gold, an insight his father brilliantly championed going so far as to say that gold is even critical to humanity’s freedom? We suspect in the fullness of time we will see that Buffett has been encouraged and pressured in his public role to not speak positively about gold for the sake of the elite who have such exposure to the financial system.  We suspect in return his compliance earns him late night phone calls, offering extraordinary assets at times of desperation when no other buyers are afforded the same opportunities. Buffett is obviously smart, but when he speaks publicly on gold his comments are simply nonsensical.

It is noteworthy that Buffett has also sold much of his equity portfolio, raising record amounts of cash as if he expects a near-term market correction and wants to sidestep impending  risks.

Don’t think that it is too late to allocate to gold. For gold to reach the same proportion of value relative to the US money supply from the prior cycle, gold will need to rise to over $7,000. While there are no guarantees that will ever happen or any other guarantees with gold, realize also that $7,000 parity assumes the government will not expand the money supply which history suggests is unlikely.

We encourage you to reach out to our team - Revisit your current allocation of gold relative to your net worth and be sure you are appropriately positioned. We will guide you through the nuances of IRA gold holdings with our acclaimed platform, give you history on gold/silver allocations and delve into the details of the metals.

While advisors tell Americans that gold is about Armageddon, history and the Bible tell us just the opposite - Gold is about making the most of the spectacular opportunities tomorrow will offer those who are prepared.

God bless, and God bless America





Past performance is not indicative of future results.