Click here tIt is no surprise to hear Ray Dalio speaking strong against the bond market. You will recall Bridgewater, the largest hedge fund in the world dramatically increased its holdings in gold by 575%. With the price of gold now trading in the $1,300’s levels I wonder if this is the new trading range, or baseline for gold? The debt issue is massive. It is not just the US but the entire world has stepped up and decided to play along. One country in particular started building with this money and went on a shopping spree throughout Africa, Canada and the US buying up resources and real estate. The Chinese have strategically positioned themselves for growth. The West spent the money on cell phones and sneakers.
The one positive on the side of debt is that it seems that most of the world has debt levels that can barely be serviced if interest rates return to historic norms. This means that raising interest rates must be done at a snail pace, if at all. As long as the rest of the world is willing to play along then this can go on indefinitely. However, if any country like China decides it does not believe in the ‘magic money tree’ that Fed has stashed away in the Federal Reserve building then problems will ensue.
China as we have mentioned before is a major holder of gold and all its production of gold remains within the country. Why when you know these facts are you not doing what these people and institutions are doing? Consider moving some of your portfolio into physical gold, even if it is just 10%. Contact me directly and lets discuss.