Great Work Banimal
Yesterday Banimal Posted a link to a PHD Thesis on Gold as a Monetary Metal which is 160 pages long
I asked him to summarize , not thinking that anyone could actually do such a thing , but low and behold he did and posted it in a comment.
This is exceptional dedication
This Deserves Front Page Billing .
Thanks a ton Sir Banimal
……………
“Here is a quick summary of each different section of the report, as there are 8 different summary sections, and the pages that the summaries are taken from can be read in full for more detail.
1) Gold’s Monetary Aspect (p. 31) – To conclude gold is and should be considered to be a monetary asset which is widely used and appreciated around the world. Based on gold’s history, wide acceptance, the political secrecy over gold and nation level demand it is justifiable to say that gold is still to date the ultimate store of value.
2) Market Efficiency (p. 62) -It is crucial for the reader to acknowledge the inefficient nature of markets even when talk-ing about years and decades of mispricing. Understanding of this enables the reader to grasp the potential opportunities presented currently in the gold market. While there are opportunities to be seen there are also many risk factors which are further examined in each of the scenarios presented in the market analysis segment of the report. One of the obstacles and a further contributing factor for market inefficiency is market manipulation which is examined in detail in the next chapter.
3) Gold Market Manipulation (p.72) – As a conclusion, there is no question whether the gold market has been manipulated in the past by a variety of market participants. The increasing number of cases brought for-wards by the CFTC over the past years and the suspicious actions seen in the COMEX futures suggest that with a high degree of certainty the gold market remains to be manipu-lated meaning that the market is unable to function efficiently in the intermediate-term.
4) First Scenario: Fundamental Supply and Demand Drivers (p. 98) The fundamentals of the gold market suggest that the price of gold will trend higher as supply contracts and demand will either rise or remain stable. Based on fundamentals presented in this scenario, the trend for gold prices should be higher or side-ways rather than lower over the next 20 years.
5) Second Scenario: Resuming the Secular Bull Market (p. 126)
If cycles hold true, the target price for gold should be well over 5000 US dollars over the next 20 years and most likely within the next ten years. It is also important to keep in mind that if and when gold transitions into a bubble it can move over 200 per cent in a year or less. This makes putting a target price for gold extremely difficult, but the 5000 US dollar target is conservative. As a conservative conclusion on gold’s cycles analysis, gold should move generally higher over the next five years. If global economic conditions continue to deteriorate gold’s next eight year cycle should also produce new all time highs even if the current eight year cycle fails to produce new all time highs. From a cycles analytical perspective, gold has limited downside especially in other currencies apart from the US dollar as many other currencies are showing relative weakness against the dollar. The cyclical outlook for gold over the next ten to twenty years is very bullish and supportive for much higher prices in all major currencies but the short term US dollar price of gold does have some risks involved.
6) Third Scenario: Monetary System Reform (p. 154)
No matter whether gold will be a part of the new monetary system history has shown that the bid for gold tends to increase during unstable times pushing the price of gold up. When adopting a gold-backed currency, the one who moves first has a massive advantage over the others since adopting a gold-backed currency signals distrust towards the current system and a solution at the same time creating a bid for the new gold standard. Currently, China has the upper hand which the US enjoyed in 1944 and the rest is history.
7) Results and the Most Likely Outcome (p. 158)
All in all, the analysis for gold’s upcoming 20 years is extremely positive, no matter which aspect is analysed. On the long-term gold prices are poised to rise in all currencies whilst the shorter-term remains uncertain with the contingency brought by the US dollar. Gold’s remonetisation during the next 20 provides the biggest upside potential for gold investors and in such scenario, the safes way of owning the yellow metal would be physically in bullion. Cycles are natural and occur everywhere. By the basis of the type of cycles analysis used in this report, the cyclical outlook for gold is also extremely positive. Even though political resistance against a gold standard is present for the time being, it does not explain the movements taken by eastern central banks towards gold accumulation.”
Well thank goodness for that! Excellent summary.
Great summary, and completely in line with my own thinking. Thanks Banimal.
You’re all most welcome and thanks for reposting it Fully. For all the great charting done by all the great contributors here, it’s the least I could do since I’m not a great chartist.
It was a bit long to go through but I might add the cycle section is most interesting (if that is what you are interested in) so I recommend reading that. The entire report is excellent and suggest reading one section a night for the next week to fully benefit from many interesting points mentioned. It’s always good to know what may be coming doing the chutes so you don’t get blind sided.
Enjoy the show in the markets today!