Jeff Snider, Head of Global Investment Research for Alhambra Investments with Emil Kalinowski, slowing it way down à la Major Marquis Warren. Artwork by David Parkins, descendant of Arthur Eld ancient King of All-World. Podcast intro and outro is “Aoraki” by Ooyy, at Epidemic Sound.
[Emil’s Summary] Hark! Inflation’s war cry… At least that is what you’ll read in the pages of the financial media. And that is EXACTLY what your central bankers need you to believe. Now, admittedly SOME commodity prices have gone up. Half of the agricultural and livestock prices are up year-to-date. Copper is up! But these are the results of supply line disruptions and demand surges. The temporary, transitory reactions to the CoVo. NOT the persistent, broad-based multi-year inflation carried in by a monetary surge that central bankers suggest. Almost every energy-based commodity is DOWN. Most all industrial metals are DOWN.
We address the issue in three segments, in this, the 19th episode of Making Sense. First, gold’s sauntering to $2,000. Silver is looking lustily at $30. Inflation, right? Central bank printing, true? Politicians handing out stipends and stimulus, yes? NO! Gold has been rising regularly – in concert with sovereign bonds – since October 2018 signaling deflation, disorder… and danger.
Then in part two, America’s dollar is said to be the global reserve currency. But might there be hostile nations scheming furiously to undermine the US dollar? They are, afterall, selling US Treasuries on net, since 2014. Is there a dollar Pearl Harbor ahead? No. Precisely the opposite. It’s the real reserve currency – the EURODOLLAR – that holds nations hostage, including the USA!
And finally, Federal Reserve officials are promoting the notion the central bank will allow inflation to run. Run pure. And hot! A Bloomberg opinion column called it “a whole new ballgame [baby!]” (I added the “baby!” part). We’ve heard this story before. Not only from the Fed but as children. From Aesop. We knew it then as, “The Boy Who Cried Wolf”.
That’s not Inflation’s war cry. Not in this monetary disorder and economic depression. It’s a publicity campaign. A caterwauling.
00:05 | Are countries attempting to overthrow the reserve currency status of the US dollar?
02:01 | What do we mean when we say “de-dollarizing”, “de-dollared” and “Special Drawing Rights”?
04:02 | What are the historical examples of “de-reserve currency-ing”? Why didn’t the Soviet Union try it?
09:16 | On net, foreign central banks have been selling US Treasuries (de-dollarizing?) since 2014. But is it done willingly?
10:55 | What does it mean to ‘sell’ US Treasuries? Why does having a lot of dollar reserves a vulnerability?
15:43 | Why does the People’s Bank of China keep raising the subject of the International Monetary Fund’s Special Drawing Rights?
17:05 | Does Jeff Snider, head of global research for Alhambra Investments, read spy thrillers? Or is it just FOMC statements?!
Huge, Massive Difference: De-dollarizing vs. Being De-dollared: https://bit.ly/30Itacu
More To Being De-dollared: https://bit.ly/3hzm2FU
Alhambra Investments Blog: https://bit.ly/2VIC2wW
RealClear Markets Essays: https://bit.ly/38tL5a7