What if... a New Gold Standard?

This ain’t your grandpappy’s gold standard… [Altucher Confidential] October 25, 2022 [WEBSITE]( | [UNSUBSCRIBE]( If it does return, this ain’t your grandpappy’s gold standard. [Hero_Image] What if… a New Gold Standard? By Chris Campbell Attention! Before You Read Any Further… [Click here for more...]( Hey, it’s James. Before you read any further in today’s issue, an urgent situation needs your immediate attention. If you don’t plan on claiming this upgrade to your Altucher’s Investment Network subscription, you’re missing out on a huge opportunity. Right now is your chance to grab one of the biggest (and most valuable) upgrades our company has ever made to a newsletter. I’m taking Altucher’s Investment Network to an entirely new level and I’d hate to see you left behind. [To see how to claim your upgrade, just click here now.]( [Chris Campbell] CHRIS CAMPBELL Could we return to a global gold standard? Is it possible? For the record, I don’t hate gold. (At least, not as much as James hates gold.) Despite my pro crypto sensibilities, I understand the argument for it. I’m always keen on hedging my bets… And, truth be told, I don’t think a return to gold is impossible. (But would it be the most ideal timeline? Probably not.) Here, I’ll show you why many believe a gold standard is coming back… and why it might be. (But also not in the way you might think.) It’s Never Going Away The idea of a gold standard is NEVER going away. There’s always going to be some appetite for it. For a lot of reasons, most of which is simply historical precedent. Case in point: Recently, Congressman Alexander Mooney introduced Bill H.R.9157, outlining a proposal to peg every dollar in existence to a fixed weight of gold. [IMG 1] Far from unprecedented… This is the way the United States was run before the 1970s, along with other nations. In 1971, president Nixon took the dollar off of the gold standard. Other countries followed. Switzerland was the last man standing until it dropped the gold standard in 1999. So it’s only been a little over two decades where the world’s been without a gold standard. “But, We’ll NEVER Go Back!” Many people think that governments would NEVER go back to the gold standard. Why would they? They would lose the immense power of manipulating the money supply. There’s truth to that. But, there’s a case to be made that countries like the U.S. would actually benefit. If the U.S. dollar was backed by gold, the argument goes, then prices and foreign exchange rates would stabilize. This would maintain global trust in international trade during a time when the dollar’s reserve status -- and everything else -- is looking a little shaky. By the way… Trump was a YUGE fan of bringing back the gold standard for this reason. He once said, “Bringing back the gold standard would be very hard to do, but, boy, would it be wonderful.” Does it Make Sense? Could the U.S. actually return to a gold standard? That depends on how far they’re willing to go to get there. Best estimates suggest there are over 2.2 trillion dollars in circulation. Estimates also say the U.S. holds 8,133 tons of gold, or about 260,256,000 ounces. (At least, that’s what’s in the books. The U.S. gold reserves haven’t had a proper audit in over 60 years.) In today’s value, assuming this number is true, that’s worth about $431 billion. If we were switching to a new gold standard, then either the Treasury would need to at least quintuple its gold reserves… OR, the government sets a new price on gold. Not Impossible Again, neither would be unprecedented. In 1933, during the Great Depression, the U.S. government “nationalized” all gold, making it illegal for private individuals to own any of it. After citizens were forced to sell their gold at well below market rates, the government set a new official rate -- much higher, of course -- as part of the Gold Reserve Act of 1934. Seizing the gold and jacking up the price of each ounce allowed the government to print more dollars to stimulate the economy. As crazy as it sounds, gold ownership remained illegal until the 1970s, when the U.S. took the dollar off of the gold standard. Back then, it seems like few were super interested in gold. Until now. Military Experts preparing for a “Pearl Harbor Style Attack” on Guam? [Click here for more...]( Putin invades Ukraine… China launches rockets over the straits of Taiwan… And as we speak, military experts are warning the US to “Prepare for a Pearl Harbor Style Attack” on Guam. [I ts the beginning of World War III?]( But more importantly, there is an [exact playbook]( on what is playing out in the world and what you need to do to prepare. Simply click here now I’ll show you how to claim your copy. The Case For Gold One popular website, called “[WTF Happened In 1971]( shows all the ways the economy began tilting in the wrong direction since 1971, when the dollar was taken off the gold standard. For example, let’s take a look at growth in productivity and hourly compensation since 1948. [IMG 2] After 1971, productivity kept climbing, but compensation became relatively stagnant. From a different lens, here’s the growth of income of the bottom 90% of earners vs. the top 1% of earners. [IMG 3] After 1971, the bottom 90% began trending sideways while the top 1% started trending upward. Gold bugs point to a phenomenon known as the Cantillon Effect: those closest to the money printers benefit most. [There are tons of graphs like this](. Yeah. Yeah. Correlation doesn’t equal causation… sure. But it’s pretty compelling. OK. But none of that matters if countries and central banks aren’t interested in returning to gold, right? But here’s the thing… Nations Loading Up Within the past few years, BRICs nations specifically have been loading up on gold at a record pace -- up to several thousands of percent per year. And other countries have followed suit. In 2019 alone, central banks added a total 650 tons to their reserves. That was the second-highest jump in 50 years, second only to 2018… when they added 656 tons. This is quite the shift… Prior to the 2008 crisis, central banks were selling gold in droves. So what changed? I’ll tell you. “The Secret Bank that Rules the World” It has to do with the Bank of International Settlements (BIS), also known in some circles as the “secret bank that runs the world.” Located in Basel, Switzerland, the BIS is the central bank of all central banks, collectively owned by 63 central banks in countries that make up 95% of the world’s GDP. The BIS controls not just the way central banks work, but also how much banks have to hold in reserve in case of market risk and what types of assets the banks are allowed to hold in their reserves. That’s where it gets interesting. The Big Switch The BIS classifies assets in terms of three tiers. Tier 1 assets are seen as “risk-free,” and banks are required to hold at least 4% of their capital reserves in the form of Tier 1 assets. On the other hand, Tier 3 assets are the riskiest assets banks are allowed to hold in their reserves. Until recently, the BIS only had ONE asset in its “risk-free” asset class: the U.S. dollar. But that’s changed. On April 1, 2019, the BIS moved gold from Tier 3 to Tier 1 -- the safest assets possible. Here’s what’s strange… While all other nations are loading up, the United States hasn’t added any gold to its reserves in 50 years. Don’t Call it a Comeback? There are serious moves on the world stage to ‘make gold great again.’ But will it materialize into a full-blown gold standard? Time will tell. A return to the gold standard might be a better shake than our current system. But it might not be the best possible system we can muster in the digital age. We’re optimists. But we’re not against hedging our bets. That’s why, when Jim Rickards talks, we listen. And this year, he’s made some bold predictions. Not only does he predict governments will outlaw cash… they’ll also implement their own forms of digital currencies. And, when the gold standard returns, it won’t look like your grandpappy’s gold standard. [Click here for Jim’s latest predictions… and how he thinks you should begin prepping.]( Until tomorrow, [Chris Campbell] Chris Campbell For Altucher Confidential Biden’s Latest IRS Move Is A Nightmare For Everyday Americans [Click here for more...]( Biden has just put everyday Americans like you into his crosshairs. As you’ve likely heard, he’s just signed into law the biggest expansion of the IRS in our nation’s history, adding 87,000 new agents… And many warn these new agents will be used to target regular Americans just like you. That’s why you need to take action right away… [Click here now for the full story.]( [Paradigm]( ☰ ⊗ [ARCHIVE]( [ABOUT]( [Contact Us]( © 2022 Paradigm Press, LLC. 808 Saint Paul Street, Baltimore MD 21202. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. To end your Altucher Confidential e-mail subscription and associated external offers sent from Altucher Confidential, feel free to [click here.]( Please note: the mailbox associated with this email address is not monitored, so do not reply to this message. We welcome comments or suggestions at feedback@altucherconfidential.com. This address is for feedback only. 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