Questions of Trust and Financial Protection
I am glad to read confirmation from three members of Silver Gold Stackers that my first post was not out of track. Thanks @bitcoinman, @royalevidence, and @olympicdragon.
I am done updating my 2015 articles. I am now checking on the content I published in 2016. And I found one that is interesting. This one is about plundering the nations and Koos Jansen’s interview with Alex Stanczyk. Though the article is old for I published it on 18 January 2016, I think some insights here remain relevant even after six years. And besides, I have been out of the gold market for more than a year and so I need to connect the dots to refresh myself on what is currently going on in this sector.
As I already shared, since July last year when I entered crypto, I virtually forgot all that I did in the past. The last gold-related article I wrote was dated 18 April 2021 when I predicted that gold stocks were about to resume their rally after analyzing both the weekly and daily charts of XAUUSD.
Now turning to this 2016 article, I based my summary on two posts published by Koos Jansen on 07 July 2013 and 09 September of the same year. My concern at this point is focused on the first article. In it, Jansen narrated three things:
That China is informed about the correlation between gold, oil, and the USD.
That China understands the intricacy of how the US plunders the world using the USD as a world reserve currency, and
That China is updated about the important role of gold in case there will be a global financial reset.
Being in the crypto space for more than a year, I am now unsure if the tentative conclusions I made at that time remain valid. These are the insights I learned after reading Jansen’s article:
Gold, oil, and commodities have a positive correlation.
Gold and the USD index have a negative correlation.
Whenever the prices of oil and commodities are down, this shows that the future prospects of investors about the economy are negative.
Lastly, the increasing price of gold is an indication that investors no longer trust the existing financial system and they are looking for ways to protect themselves.
Currently, though I haven’t explored yet the overall price trend of both oil and commodities, generally, reading crypto-related articles I got the impression that investors are worried about the future direction of the global economy.
As to how the rising price of gold relates to the issues of trust and financial protection, well, such an analysis could be well-received if given in August 2018 when the price of gold reached 1,155 USD. From that time on, gold enjoyed a two-year rally until August 2020 when it reached 2,068 USD. After that peak price, gold retraced for seven months until March 2021. It then climbed up again for a year to reach its previous high. From March 2022, until September this year, gold touched 1,612, which seems to be the new floor price.
So, for two months now, the price of gold is increasing. Is this current price increase now an indication of growing distrust in the system? Personally, I am tired of responding to this type of question. If gata.org is correct that the gold sector is heavily manipulated, then the price direction of gold cannot provide us with a reliable indicator of such a growing distrust.
How about the question of financial protection? If the heavy hand of the government can touch this sector and do whatever it wishes, how can investors really protect themselves by investing in gold-related investments? Isn’t investing in a decentralized blockchain like Hive a better move?
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Don't you think every major market is manipulated by those who have powers be it gold, oil or crypto?
I have a question if you might explain as I am quite naive about financial technicalities
Does it mean that the low price of commodities and oil show that economy of a country is down? Does it mean inflation demonstrates a better economy?
Manipulation in gold is well documented. As for oil, I think it also exists though I haven't read any reports about it. As for crypto, yes it can be particularly in centralized projects. That's why we prefer decentralized entities like HIVE. If the analysis of a few analysts on Hive is accurate that no whale holds more than 5% of the HIVE supply, then such manipulation would not be easy. It can be done in small ways but not to the extent that it will dictate the overall price direction of the token. The only way to achieve such price manipulation is in the case of whales who hold more than 50% of the token supply agree to such a goal.
Low prices of commodities and oil show low demand and this only happens when the economy contracts. As for the inflation question, economists too are divided. After spending more than a year on Hive, I realized that there is a certain kind of inflation that is good, that is, an increase in money supply matched with increased economic activity such as more business development, more products in the market, and that the additional money is used as capital for numerous projects.
Thanks for your time.
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Ahaan! Makes sense. Even if there is increase in price, people have the ability to purchase items because they have money at their disposal , the inflation doesn't count negative for the economy.
Thanks for the explanation
!hivebits
My pleasure.
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One thing I have come to discover about financial market is it is often controlled by the whales
I just stumbled upon that name in the crypto space. 😅💲🦈