Craig Hemke: Fed Not Fighting Inflation Equals $18,000 Gold

• Craig Hemke: Fed Not Fighting Inflation Equals $18,000 Gold
  by Greg Hunter’s USAWatchdog.com
  Financial writer and precious metals expert Craig Hemke predicted in July that silver was about to start a dramatic move higher.  He was right.  After Tuesday’s smash-down of the metal, Hemke says precious metals investors have nothing to worry about.  Hemke explains, “The important thing to understand is the fundamental stuff that has driven gold and silver higher, especially in the last couple of weeks, none of that has changed. . . . You get these speculative excesses.   They traded on the COMEX futures exchange (Tuesday 8/11/20) 1.5 billion ounces of pretend fake digital silver.  In a normal non-Covid world, the entire globe mines about 850 million ounces of silver.  So, in one day’s trading of the phony baloney plastic silver, they traded two times global mine supply. . . . The picture has not changed fundamentally.  They can trade two times global mine supply and you get these speculative excesses that get wrung out, but that just sets you up for the next move higher.”
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  Hemke also points out that the Fed is signaling new policy changes to prop up the failing economy.  In simple terms, the Fed is going to allow much more inflation than 2%, and on top of that, the Fed is not going to raise interest rates to fight it.  Hemke says, “We are going to have a very bumpy economic growth ride with what has already taken place with Covid and what is going to come.  The Fed has already promised it is going to maintain 0% interest rates on the short end (of the curve) until 2022. . . . The Fed is going to let inflation go past 2% to 3% or 4%.  They are probably going to make this change at the September Fed meeting. . . . They are going to let inflation overshoot 2%. . . . The reason why they do that is you can pay off all this accumulated debt with the less valuable money of tomorrow.  This is how it has always worked. . . .These two policy changes go hand in hand.  They are going to let inflation run, and they are locking in nominal rates and institutionalizing steeper and steeper negative real rates.”
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