"Gold Prices Will Skyrocket In 2026..." - Matthew Piepenburg

本站添加: 2026-05-31

[00:00:00]The US Treasury market, maybe you could argue is certainly more powerful than the gilt market, but in some ways our economy needs lower rates. We need lower rates because our economy is so fragile.

[00:00:10]But if we have inflation, we're going to have to have higher rates. The [music] problem with higher rates is we can't afford them. That's the entire fiscal dominance argument. If we have higher rates to fight the inflation, which is oil driven now in addition to monetarily driven, we're looking at a stagflation environment. If we raise rates to handle these inflation storm clouds, well then the cost of our own bar tab, our own public debt becomes unpayable. So the only way to pay that debt is to expand the money supply or print more mouse click dollars, which is inflationary. So the ironic paradox is that the very forces to fight inflation, the very policies are themselves inherently inflationary. I'm not alone in this, but I think just like UBS or Goldman Sachs or JP Morgan, who I don't often quote for candid transparent advice, I think stagflation is the future. We can see deflationary forces.

[00:01:01]But our tools of money supply expansion and rate cuts or rate hikes are becoming more and more impotent. We don't have much of a choice. [music] We can't afford to raise rates without debasing the currency. And that's the Hobson's choice that all central banks make. Do they save the bond market or do they save the currency? And they always save the bond market at [music] the expense of currency, which means there's going to be a massive debasement trade in paper money [music] in general, and of course the US dollar in particular. And that of course for me is a massive tailwind for gold longer term. Obviously I have a bias, [music] but this bias is shared by bankers at Goldman Sachs, JP Morgan, UBS, the IMF, [music] the BIS.

[00:01:42]It's shared by the central banks of the world. So it's not just a gold bug bias.

[00:01:46][music] We're looking at the direction of gold as a more trusted reserve asset than a debased ice cube melting US dollar or any paper currency. So these are all longer term tailwinds for gold.

[00:01:59]The price reductions we've seen because of sell-offs [music] in gold to cover other losses like margin costs literally, but the longer-term direction for gold is going to be much higher for the end of this year. My base case is at least 63, 6500, probably over 8,000 in US dollar [music] terms. So, these sell-offs for liquidity because of a liquidity shortage right now during the war are [music] just going to be tailwinds for a much higher gold price longer term. reason why these pullbacks are buying opportunities not just the inevitable retracement after a blow-off top in 2025. To me, 2025 was the first couple innings of the first half of a soccer match, not the end of the game, certainly not the floor for gold or the high for gold either.

[00:02:40]>> [music] >> But, you got to keep it simple without being simple stupid. You know, historically, this is what we understand. And I think sophisticated [music] gold investors understand this that look, gold is real money. Central banks are seeing this. Pre-1971, central banks 70% of their reserves were in gold. Today, it's only 30%. It's climbing, but it will get to at least 50% for all the reasons we've been discussing. Gold is becoming >> [music] >> the de facto primary reserve asset, the new FX reserve currency. In that world, gold is increasing [music] in dominance and the dollar is falling. Cannot underestimate the fact that central bank gold stacking has increased by 5x since [music] the US dollar was weaponized against Putin in 2022. Again, regardless of what you think of that war, weaponizing a neutral reserve asset like the US Treasury and US dollar caused a massive distrust for that dollar. You know, our argument has always been that gold is not rising, the dollar [music] is falling. The US money supply M2, which is far more important than M0, went from 15 trillion to 21 trillion during COVID. That was a 40% increase in dollars in 2 years. [music] And then after that, there was another 30% increase. That's the definition of inflation, Milton Friedman, [music] it's the money supply. You can look at other ratios like M2 money supply to the gold price. That ratio today is around 4.6.

[00:03:57]It's been as low as 2.5 in the '80s. I think we're heading in that direction, a compression. The other one that a lot of people are talking about in the gold space is the market price of US official gold to its [music] foreign US held treasuries. That ratio or that percentage is about 14% in 1989, it was 20%. And in the last 80 years, it's gone as high as 40 to 60%. [music] So, for gold in that ratio to even get to somewhere in that ratio, gold would have to triple to get to 50% of [music] US gold to foreign held US treasuries.

[00:04:25]Again, I think the tailwinds are very obvious. But for me, aside from those kind of historical data points, what we're seeing right now with some of the sell-offs, which are totally to be expected, it isn't because gold is topped. It's a classic, classic liquidity squeeze. It's a paradox of central banks, hedge funds, investors, and nations having to sell the good to cover the losses in the bad. Gold is the most liquid and valuable asset to sell.

[00:04:50]Turkey, for example, just sold 10% of its gold in Switzerland because, you know, that's 60 tons of gold. And they had to do this because 90% of Turkey's oil and gas is imported through the Middle East, and they have to buy that in dollars. So, they needed dollars to buy gold. What's interesting about Turkey is they didn't just sell their gold in Switzerland, they did a swap.

[00:05:09]You see the same thing in ETFs. A lot of that was two to three x levered ETFs.

[00:05:14]These investors were not wealth preservationists, not long-term thinkers. They got their stop signals, they had to sell. The hedge fund space has sold a lot of gold since this [music] war started. Not because it's the end of gold, but because they need cash. When Middle East made these, their stocks go down. So, lots of levered losses in the hedge funds. Sometimes, if they're 5x to 40x levered, when big funds see a panic sale, that's usually a sign that they're selling their gold at a margin. And [music] throughout my experience in Wall Street, when you see a massive panic sale to cover losses, it usually means the smart money sells this aggressively. When that happens, you usually see there's a massive reversal afterwards. And I think the most important thing, and I can't believe I'm saying that, if you want to know the price direction of gold in the future, you've got to watch what the banks are doing rather than what they're saying.

[00:05:59][music] Even before the war started, early in 2026, the year-end gold price targets for Goldman Sachs and JP Morgan were 6,300 as a base case and 8,300 as a possible target. So, even the banks, which are no friend of gold, can't deny that it's going to rise because of [music] the inflation to come, the stagflation to come, and the debasement to come. They're seeing energy supply disruptions [music] that's going to take years, not months, to repair. The dollar is going to fall because of deficits and they'll pay those deficits with printed money. [music] That's just to me undeniable and it's undeniable to even Goldman Sachs, which I never thought I'd quote to support [music] the gold price.

[00:06:36]And 20% of the emerging market reserves are going to gold right now. So, long way of saying the fundamentals haven't changed. I think short-term it's like a cannon that backs up as it's firing. You know, of course, you're looking for the most liquid and valuable assets to sell in a time of crisis. [music] This is clearly, whatever you think, a time of crisis, whatever party or hopes or wishes you have. And gold, like US Treasuries, are two of the things that can be sold. I think the fact that gold is looked at as the most valuable liquid asset for a quick swap or quick collateral, more so than the dollar, is a telling signal [music] of gold's future direction. You know, I have a lot of respect for Brent Johnson, the milkshake theory, the safe haven of the US dollar in times of crisis, but we're not seeing the DXY go anywhere near 130 or 150 like he said. I think the milkshake theory and Brent are brilliant in a lot of ways. Where I disagree is, yes, there's a massive dollar shortage and liquidity problem with the dollar, but the bigger issue for me, to your point, is the US Treasury market.

[00:07:35]There's less and less love for that market, and the sell-off in US Treasuries for liquidity or the sell-off in US Treasuries in favor of gold I've been tracing since 2014. The real issue is not the dollar as much as the demand for US Treasuries. That safe haven is becoming less and less safe simply for the fact that the US is at [music] 40 trillion in debt. The risk premium for taking on a US bond isn't that high.

[00:07:57]You're not getting that much return for the risk. You're not really beating actual as opposed to reported inflation.

[00:08:02]It's a negative return. [music] So, it's the US Treasury market that is so much more important, I think, than the dollar market. I know from [music] my time in Wall Street, you know, in a risk-off period in a crisis period, you'd see a major bid for US Treasuries. But, if you understand what goes on behind the curtains there, that bid usually lasts about 10 minutes, and then there's a big dumping of US Treasuries, a need [music] to sell US Treasuries to get liquidity.

[00:08:26]And what I mean by that is US hedge funds buy almost 40% of their Treasuries via the Cayman Islands. They have to sell their leveraged US Treasuries in a crisis. So, the yields spike, you know, within 15 days. They buy it, and then they sell it, and then the yield spike.

[00:08:42]Again, going back to the boring, [music] boring bond market, when there's a dumping of Treasuries for liquidity, yields spike, and that makes [music] it almost impossible for countries to get out of their debt traps. And every major country in the G7's in a debt trap.

[00:08:55][music] When there's a sell-off in gold for liquidity, that doesn't affect the yield or the cost of debt. When there's a sell-off in US Treasuries and US gold, it's [music] far more dangerous to see the sell-off in US Treasuries because that just means spiking yields, spiking debt costs, and debt trap nations have nowhere to go but print more money. And the irony is you can sell-off gold to get liquidity, but as nations print more money, the gold price is going to go higher. [music] So, you've got to have a long-term view of where gold is going if you're an investor as opposed to a trader. Trading gold is extremely complex, especially in volatile times.

[00:09:26][music] There really only are three outcomes. If the war ends today in a totally peaceful, agreed-upon ceasefire, and Hormuz opens, and And [music] a Kumbaya, peace, love, and happiness moment, flowers in her hair. That's great, but we still have delayed inflation coming. We still have a weaker petrodollar arrangement. I know China is never going to agree to a petrodollar out of Iran. The dollar will still weaken. If the war continues, well, then things break irreversibly. The UK and the EU bond markets will crack. They'll sell off those US treasuries you've been talking about. That will cause a a dumping of more treasuries. The US bond market will break because the yields will spike only way out of that for the US and the US bond market, which is everything to the US [music] and to the Fed, is going to be yield curve control and QE to the moon and mouse click money and the debasement trade that we talked about in 2025 will seem like nothing compared to what's coming. I don't see in any any scenario, even if the war ended today, as I said and as the big banks have said, it's going to take months, if not years, to [music] repair the infrastructure damage, to repair the trust damage, and I don't see anything but stagflation ahead. We could have disinflationary or deflationary forces, but the central banks like the Fed, their only resort, other than more war, which is out of their hands, their only way to pay for this crisis is going to be expansion of the M2 money supply and money printing [music] to the moon and a debasement trade. And the longer-term direction for gold here to me couldn't be more clear. Yes, though, I have a massive bias, but our bias is based on conviction and we've never been more bullish right now.