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Published on Sep 8, 2016
Gold
is up 26% thus far in 2016 and heading into the fall the greater risk
remains to the upside due to the tremendous amount of money sloshing
through the system, said Josh Crumb, founder of Goldmoney. 'The last
couple of years the expectation was exiting monetary policy and raising
rates,' said Crumb. 'And after China and oil and credit problems in the
first quarter, the market realized that it is going to be very hard to
exit this liquidity trap and that's when the market revalued gold back
to where it was a few years ago and I still see that asymmetry.'
Goldmoney is a full-reserve and gold-based financial services group,
operating the world's largest self-directed gold savings and payments
network. Goldmoney makes allocated physical gold accessible as a
currency to any person or business with internet access. And currently
has over one million user signups from over 200 countries and $1.8
billion in client assets under administration. 'With our platform you
can buy $100 a month worth of gold, just like you used to put in a
savings account - back when you actually had interest rates,' said
Crumb. Crumb said the potential Federal Reserve interest rate hike this
September will not hurt gold prices because gold prices are a function
of historically low real interest rates. Also helping the yellow metal,
in Crumb's view, is the dislocation in the currency markets, especially
post-Brexit. 'How many currencies have been devalued in the past six
months?' asks Crumb. 'From Brazil to Nigeria and many in between. I
think this currency volatility is at the beginning and we are not close
to the end yet.' In terms of new supply hitting the market and knocking
down the price, Crumb says gold will generally remain immune. 'The
demand as a safe haven is going to continue to outstrip any incremental
supply as long as we are pursuing experimental monetary policies
indefinitely,' said Crumb.
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