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The U.S. dollar is at a tipping point, and gold is quietly reclaiming its role as real money.
In this exclusive interview compilation from the Rick Rule Symposium, Rick Rule, Frank Giustra, Grant Williams, Nomi Prins, and Peter Grosskopf reveal why the global monetary order is shifting.
What you’ll learn:
- Why the dollar could lose 75% of its purchasing power—just like in the 1970s
- How BRICS nations are building a parallel system outside U.S. control
- Why central banks are secretly hoarding gold at record levels
- The coming bull market in gold & silver—and what triggers it
- Why the Fed is trapped and will return to QE and money printing
- How strategic resources like copper, uranium, and rare earths are now a matter of national security
This isn’t just about gold, it’s about the future of money itself. As the dollar’s dominance erodes, BRICS nations are creating a new trade and reserve system, and gold is quietly moving back to the center of global finance.
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Rick Rule 0:00
I believe that because of the accumulated debt and deficit, particularly off balance sheet debt entitlements and the unfunded entitlement liabilities, that the purchasing power of the US dollar over the next 10 years is going to decline by 75% if that is more or less right, then the gold price goes up fourfold from here the
Mario Rodriguez 0:24
Hello, everyone. Mario Rodriguez here. I’m the executive producer of wealthion, and the guy, usually behind the camera and behind the guests you see on our channel, me and the wealthian team spent last week at Rick rolls fabulous annual symposium. It’s an event where the best and brightest investors, researchers and companies in the golden metal space gather each year. Today, we are bringing you some of the deepest insights on precious metals and macro investing from five out of our 15 symposium interviews, you will hear from Rick Roll himself, Frank juice draw, Grant Williams, Dr Nomi Prince and SCP resource finance Chairman Peter groscoff, everything from the fading dominance of the US dollar to the coming super cycling gold and silver to how geopolitical shifts are reshaping the entire financial system, they deliver perspectives you simply won’t hear anywhere else. Many of our interviews delve into investments you can only achieve by being an accredited investor. By signing up to our accredited investor list through the link in the description below, you’ll get all 15 full length interviews from the symposium for free, plus our free reports on investing in rare earths, uranium and copper, some of the hottest metals right now, we begin our video with a great man himself, Rick Roll, explaining why he believes that you he believes the US dollar is heading for the same fate it faced in 1970s losing 75% of its purchasing power, driving the price of gold way, way higher. Let’s take a listen. You Steve,
Trey Reik 2:03
So you made the comment that you think we’re heading into a very important precious metals bull market. So I’m going to pin you down, since we just went from, you know, 1800 to 3300 What do you see that excites you about the next five years, as opposed to the past three. You
Rick Rule 2:22
got to give me the next 10, not five. I believe that the analog to the deterioration the purchasing power of the US dollar that we’re going to experience is the 1970s in the 1970s according to the Office of Management Budget, the US dollar lost 75% of its purchasing power. This is not some old, fat libertarian Rick Rule saying this. This is the office, the Congressional Budget Office. I believe that because of the accumulated debt and deficit, particularly off balance sheet debt, entitlements and the unfunded entitlement liabilities, that the purchasing power of the US dollar over the next 10 years is going to decline by 75% again. I don’t know how it will be reflected in the gold price, but the easiest thing for me to say arithmetically is that the increase in the gold price will mirror the deterioration of purchasing power of the US dollar. If that is more or less right, then the gold price goes up four fold from here. People say to me, Rick like, give your head a shake. Gold has already gone. Already gone. It’s already up 40% if the analog is the decade of the 70s, let’s assume that the move in gold price from $35 to $100 was a dead cat bounce off the restriction the gold price. And let’s say that the move in the gold price above 550 to 850 was morons piling on that move from 100 to 606 foot move is a pretty good move. And if the cause of it is the perception of the deterioration in the purchasing power of the US dollar. I think it’s absolutely right to assume that the increase in the gold price, the increase in the nominal gold price, could reflect the deterioration in the purchasing power of the US dollar.
Trey Reik 4:11
So do you think that the scenario for the US dollar in the 70s was mostly, you know, motivated by inflation,
Rick Rule 4:21
or it was motivated by a negative real interest rate. We fought well, you didn’t, well you were you were alive. Then we fought the war in Vietnam, which we lost, and we fought the war in poverty, which we lost, and the highest marginal tax rate in United States then, before weird deductions, was 80% so we couldn’t raise taxes. We had to deal with these social obligations. We did it, not by changing the nominal value of our obligations, but really by changing the purchasing power of the dollar. The second thing that happened is that the the way. The fear of inflation was expressed in the market, Or put differently, the experience that consumers had with inflation juxtaposed to the rate of that they got on their savings meant that interest rates were sharply negative. We had a 10% measured rate of inflation. We measured it, of course, differently then and people were getting paid 5.5% on their savings accounts. Well, that was reflected pretty clearly by a change in a change in asset allocation from cash and cash equivalents or long term bonds to gold. We have a circumstance today Trey where, if your listeners believe in the CPI, they’re pretty sanguine. You get a 4.5% yield the US 10 year treasury. In a currency where you’re purchasing power is deteriorating by two and a half percent, you’re getting a 200 basis point real yield. I believe that’s ridiculous. The CPI is not a good measure of the deterioration of the purchasing power of your savings. For one thing, the CPI doesn’t include tax. Do you pay tax? Trey, a little bit. Yeah. If you look back at the basket of goods and services that the Reich family consumes, say, I don’t want to test your memory go too far back, but to the 2020 to today, gasoline prices up two and a half percent, compounded hardly. Mortgage rates doubled. Groceries are a political issue up 60% and they’re telling you the deterioration the purchasing power of the US dollar is happening at the rate of two and a half percent a year. I mean, what they’re smoking is not legal to transport state to state to state. I
Trey Reik 6:49
believe my favorite CPI stat is they measure the cost of health insurance. Have you heard this one? It’s down by the retained earnings of the insurance companies. That’s that’s literally, when you look it up, it says, we calculate, you know, the cost of health insurance by measuring the retained earnings of the insurance companies. You’re like, these guys should sell. I mean, and I don’t know if you know this, but the cost of health insurance is actually declining, you know, over the last several years, according according to metric, which I think is pretty incredible.
Rick Rule 7:22
Yeah, let’s compound the losses and call this again in the CPI. Anyway,
Mario Rodriguez 7:25
in this next segment, Frank juicer explained why the dollar’s dominance is fading and why gold is quietly reclaiming its role as real money. He also shares why he believes a return to money printing is inevitable, and this time, it will be far more devastating.
Frank Giustra 7:45
I’ve been writing and speaking about gold ever since I bought my first gold in 2001 never sold an ounce. Added to that in 2018 never sold an ounce. And I believe gold has real long term value. It has been proven right. When it started 250 it’s gone up over, well, 15 times in the last 25 years. So yeah, I consider myself someone that’s well informed when it comes to the subject of gold, and I can talk about it at all levels, and I study it day and night.
Trey Reik 8:17
So in a nutshell, the thesis is the dollar is going to my first
Frank Giustra 8:22
article in 2001 was titled really cute, tarnished dollar. Tarnished dollar will put a shine on gold. That was the title I put to it. And it was really a making a case that the dollar versus gold, the dollar was going to go down and gold was going to go up versus the dollar. And I gave all the economic reasons, the monetary reasons why that was going to happen had to do with trade deficits. It had to do with the Fed becoming more accommodative to fixing every crisis with easy money. It started with Greenspan and then became worse and worse and worse with Bernanke and Yellen all the way through each each Fed Chair became worse than the one previous in terms of allowing, basically this moral hazard to create as much debt as you want, because the Fed will always bail you up. There was always and I saw that coming, and especially after 2008 and I predicted money printing. When the crash happened, I said this time they’re going to do money print, and they ended up calling it QE, which was really cute name and and my thesis is that we are any in a macroeconomic environment where we’re going to go back to QE, and there are a number of reasons for that, and my theory is why eventually, whether it’s this year or next year or the year After, we’re going back to QE, and this time, it’s going to be devastating. So
Trey Reik 9:45
I have been working on gold for about the same period, and I think you and I share many of the same theses about gold, but I think you will agree I’m a bit surprised that the system is actually held together as long as it has like. I would have told you 15 years ago, the dollar is finished. It’s over tripping dilemma the whole bit. But it is amazing how much when the system has invested in a, you know, $1 standard system, or
Frank Giustra 10:15
global system, it takes a while to unwind that global reserve currency, if it doesn’t happen overnight,
Trey Reik 10:21
right? And there’s so many people who are invested in the dollar standard system. It’s taken,
Frank Giustra 10:26
it’s made of it’s created wealth inequality between the US and many other nations, because the US has been able to export its inflation to other countries because of a strong dollar and and lower its inflation because it can import goods with a strong currency, so it served its purpose for the US hasn’t done a lot of good for a lot of countries, and they’re finally starting to revolt, right? And that’s why you’re getting the bricks movement. Brooks is now 11 countries, with 44 applicants, and 120 observers, observing countries, and half the world’s population, almost half the GDP, right? And so we’re getting, we’re going to into a bifurcated world, where they’re going to be two systems for at least a while, until we get a real global monetary system reset, like Bretton Woods was during after World War Two. But I don’t think that that that the world is ready for agreeing to a one system. I think he might need a conflict with that before that happens. Sadly, sad to say, because that’s the way these things end up correcting themselves, is usually through conflict throughout history. So in what I’m focused on is what’s going to happen in the medium term, until we get this new reset down the road. And it’s already happening. There’s a mirror, an exact mirror system to the Western financial system being created by China and the BRICS and everything from pay settlement, depository insurance rating, alliances, currency swap arrangements, New Development Bank, which is going to mirror the World Bank. They’re creating an exact mirror system that exists outside of the US dollar system, and that’s the future, and that’s where all these BRICS countries are coming together, and the US doesn’t like it. You’ve seen Trump threaten twice now that if anybody, anybody creates any anti American policies, whatever that means, he’s going to punish with tariffs. And that, to me, is a sign of desperation when you have to threaten people to use your currency, that’s you’ve lost your privilege to be a reserve currency.
Trey Reik 12:25
So over the years, I’ve always told my investors there are the right reasons gold goes up and and the less right reasons. There’s no wrong reasons. But geopolitics, you know, October 7, you know, a couple years ago. I mean,
Frank Giustra 12:39
those are all short. They’re flashes in the pan.
Trey Reik 12:43
But my point is that for all these years that we’ve been following this, I think it’s actually happening. You know, what we’ve been planning for, what we’ve been anticipating, is finally starting to happen. You agree with that, 100% we’re hitting the tipping point.
Frank Giustra 12:58
We’re absolutely so you when you speak, you know, usually there’s a geopolitical flare up in gold has a run up, right? Very short lived, right? What’s been driving this longer term trend that started in 2001 by she started 1971 but is really more about lack of faith in the dollar, fear of the dollar being weaponized. I think that would the Ukraine. The Russian freeze really woke up a lot of countries around the world. Is China, who had one of the second largest Treasury holdings in the world. They saw the writing on the wall, and they’ve been de dollarizing at a very steady pacer down from one point 1,000,000,000,007 50 billion Japan, which was always the most steadfast buyer of us, treasuries, actually sold some for the first time, 50 billion in the third quarter or fourth quarter. And for their own reasons, there’s more about their own policies coming home to roost on having to sell their dollars to support the yen. But yeah, this macro trend is definitely in place because the world like there are two concerns. One is the sanctions and the fear of sanctions, and the other is the fiscal state of America. They are there’s no will, and we’ve seen it, whether I don’t care if you’re Republican or a Democrat, they both increased deficits by equal amounts. No one is interested in really addressing the deficit problem, and we’re heading towards a cliff, and the numbers are so large now and growing at such a large with large deficits every year, like plus $2 trillion every year is the norm now, and as far as the eye can see, and then you have the 100 trillion dollars of unfunded liability sitting there that no one seems to want to talk about, and you have a recipe for a financial currency crisis. And I see that will happen, how it manifests itself? Could be a job like questions,
Trey Reik 14:58
how is. It going to resolve it? So you mentioned the currency crisis war.
Frank Giustra 15:04
Well, the currency crisis is either going to happen, be triggered by geopolitical event, failure of financial institution, or a failed Treasury auction, a real failed Treasury auction, where there are no buyers, and then the Fed has to, as always, step in and monetize that debt. And that is absolutely, as far as I can see, there’s no way you’re going to avoid that. And you know, especially if Trump gets his way and tries to lower rates down to 1% with his next Fed chief, he’s going to hire someone who’s going to do exactly what he wants done. And he’s very good at doing that, getting people to do exactly what he wants done. He’s very persuasive, and I think the next Fed chair will do as he’s instructed. There will be no separation between government and the federal reserve. And if he gets those rates down to 1% what does that mean in terms of I mean, certainly it may fuel a rush to equities and assets and whatever, but ultimately it’s going to lead to a complete destruction of the dollar, and you’re going to get inflation, and then if the foreign buyers, and even the domestic buyers of US Treasuries, start to get spooked, that’s when the spiral really comes into place, and can happen very quickly. And so what would the US do in the US dollar crisis be nasty. So do you
Trey Reik 16:21
think the dollar will be replaced or play a lower
Frank Giustra 16:24
role? I think I don’t think it’ll be replaced in any I think you’re gonna get competition in terms of a trade currency which is different than a reserve currency. Okay, the role of a reserve currency is very different trade. So what’s happening now, and it’s happening very again, led by China, including the Brits and a number of other players. They’re creating a payment system that uses digital bank, digital certified digital currencies, completely outside the US dollar system, with gold. In my opinion, this my theory. Has been my theory for five years. The gold is going to play a role. And the most obvious role that I see is that if you have bilateral trade between two countries using their local currencies, define the central bank digital currencies, and they’re trading, and there’s a surplus, country has a surplus. Let’s say Saudi Arabia and China and Saudi Arabia ends up with a bunch of unwanted Yuans. Everybody always told me that the reason that wouldn’t work is because what are these countries do, going to do with those unwanted currency that’s not a, you know, global reserve country, like the dollar, is not as liquid, etc. Well, the answer is gold. And this way, all the same countries that are participating in these, what’s called the Enbridge project, which China started, are all the countries that are buying gold in huge amounts. And then, more recently, China announced that you are now able to exchange your Yuans. And the Shanghai gold exchange for gold. They created a warehouse in Hong Kong, the first will be many around the world, where the physical gold will be stored and you can take delivery. So if you have a bunch of unwanted Yuan between you just go and exchange anyone for gold. That’s why China, as I believed for years, and I said for years, has a lot more gold than they’ve officially reported. They were officially reported 2200 tons. I’ve been saying they had a lot more for years, because you just watched the physical flows into that region, and the numbers didn’t make sense. And that Goldman Sachs recently came out and confirmed that, saying they probably have up to 10 times more gold than they disclose. And that’s what I’ve been saying for about five, six years now. And I think that that gold, when they determine that there’s a need to disclose how much gold they have, there’s a purpose, they finish accumulating because they’re still buying, still buying, then you’ll know what the number is. But not yet. Saudi Arabia, same thing. They’ve been buying gold. They never report anything officially. But we see the physical flows into Saudi Arabia, and has been massive flows. They don’t report a thing. The last time they reported was 2015 do they even report their central bank reserves? Well, they did the last time, 2015 but a lot more gold is flowed there in the meantime.
Trey Reik 19:04
Interesting. So as this monetary regime, which I think we would all agree, is already evolving, the step wise nature of the BRICS, et cetera, dollars down from 72% of reserves to 57 or whatever, 58 What do you think gold will play an official role in the monetary system?
Frank Giustra 19:26
It already is. It’s a tier Basel three, which is Bank of International Settlements, the bank of Central bank of Central banks, created Basel three rules, which made gold a tier one asset. What does that mean? It’s the equivalent of cash, zero risk asset, and now that’s going to be adopted by all the commercial banks. July 1 was the supposed date when that all happened with commercial banks in the US. And so gold is now money. It was always money. We just have been trained to think it’s only not been money for the last 50 years. It was always money before that, and it’s going to be money again. So it’s now replaced the euro as the number two reserve holding under the dollar in all central banks around the world surpassed the euro. So to me, gold today is more valuable than US Treasuries
Mario Rodriguez 20:15
up next. Grant Williams explains why a single decision by the US Treasury in 2022 changed the global financial system forever, resulting in de dollarization, in this surging gold buying. Here’s why grant believes that moment marked the beginning of the end for unquestioned dollar dominance.
Trey Reik 20:39
Do you think, speaking of the dollar, that we have already started the process of evolution from the dollar standard system
Grant Williams 20:48
depends who you ask, right? If you ask, if you ask people in Asia, they would probably say yes. You ask people in America, they would definitely say no, because to them, King, dollar is sacred, and it has always been sacred. And so why would they conceive anything different? And to them, it’s not any kind of problem, right? So they don’t have any they’re not there’s no incentive for them to their dollar denominated other countries, not so much. There are clear incentives now to try and at least reduce reliance upon the dollar and to also reduce your your ability to be influenced by the policies of the Fed, and particularly the Treasury. You know, I think what happened in 2022 when the Treasury froze those Russian Central Bank assets, that was a really key moment that that kind of bypassed a lot of people. They just thought it was another sanction, and it didn’t really register a lot of people, but that was a game changer for me. You know, I think from
Trey Reik 21:44
that moment, Chinese Treasury holdings accelerated down. Everybody. Central Bank gold buying doubled, yeah, literally from that moment.
Grant Williams 21:52
So that’s right, and those are, those are the visible signs, but you have to think about the incentives, because what you, what you did in that moment, was you said to everybody in the world that holds dollar reserves, which is everybody. Everyone’s either a net importer or exporter of energy. So you said to everybody, there are conditions under which we will freeze your reserves. Now I don’t think Indonesia is going to invade Ukraine anytime soon, but it told Indonesia that we don’t know what they might be, but this is no longer sacred. The Arabs are no longer sacred. So we’re now incentivized to find alternatives. So you’ve you’ve started that process now, and it’s not something that goes back because you’ve done that, you there’s evidence that you do it. There’s no guarantee you won’t do it again. And so it becomes an issue of national security. So I think there’s a really important moment in history. And to your point, right? If you go back and look at these various things, you can draw a line the day before that happened, a line after and central gold, central bank gold buying has ballooned since then, and that is a clear sign that they’re thinking, well, less dollars, more gold is probably a safer way for us
Trey Reik 23:02
to go. Right? We’ve heard about the brakes for probably 20 years, common currency, etc. I remember the very first picture of the five leaders in holding hands up in the air. And here we are, 15 later, years later, and not much has come of it, but they seem to be adjusting their focus from a common currency to a sort of multilateral clearing type understanding of Yeah. So do you think BRICS is finally becoming a functioning alternative to the dollar? I
Grant Williams 23:36
don’t think we’re there yet, but these things take time. And when you’ve got so many countries trying to negotiate and find common ground, countries vastly different economies, vastly different levels of GDP, they’re so different these countries. It’s, it’s, it’s crazy, but what people have to understand is the direction of travel is set right. They’re on that path. And yeah, nothing’s happened. And yeah, we might get three more summits go by when nothing gets announced, but the talks are happening that they’re continuing down that road, and they will continue down that road because it’s in their best interest. So again, you know, it’s another it’s another stable door that there’s no point closing now, because the horse is out, and you can sit back and say, well, they’re never going to get it together. They’re too disparate. They’re too but every time something happens along the lines of that Treasury move you, you give them a reason to put aside their differences and come together in a common cause, which is, how do we get out under the yoke of the dollar? So I think anyone that says it’s definitely going to happen or it definitely isn’t going to happen is is kind of missing the forest for the trees. There are clear incentives for it to happen. It just becomes a question of, can they do it? If they can, what form does it take, and what does it look like? But that’s the way we’re headed. There’s no two ways about
Trey Reik 24:54
it. Have you studied the Enbridge system that China is developing? Yeah, a
Grant Williams 24:59
little bit. And it hasn’t reached the kind of stage where I feel like I need to be all over it yet, because
Trey Reik 25:04
they are starting to get into technical details in that type of thing that way, for sure. So it’s interesting, and gold plays a role, a big topic here at the conference, on a topic yesterday, there was some talk about where gold is heading. And I think you pretty effectively sidestepped naming a price, but I understand.
Grant Williams 25:26
I don’t look at, I don’t care about
Trey Reik 25:32
the price of gold. Well, tell me about that.
Grant Williams 25:35
Well, I don’t. I’ve never bought gold to make money. I bought gold to keep money. And so the price is irrelevant. It’s really what I can exchange it for. So I everybody wants to know what the gold price is going to be. I don’t know so many a year ago, did you know that the gold price could be 3500 I said, Yeah, but I didn’t know it’s going to be. Now, I feel very confident it’s going to keep going higher because of the nature of the world we live in. But I’m not looking at 5000 to target where I’m going to sell it. I’m going to exchange it for a house somewhere that I want to buy when I realize that those ounces of gold rather own the house. So I think the price, I understand why people fixate on it, but I think it’s a bit of a red herring if you own gold, for the reasons, if it’s a trading vehicle, the price is everything. But I just feel like gold is is so much more than trading people. You want to trade stuff. There’s a gajillion things you can trade, options and shares and bonds and ETFs. You can trade anything. Why do you feel the need to trade gold? At the point I made in my presentation this morning is, you know, gold isn’t someone. You buy something you buy, it’s something you own. Because if you talk about in terms of buying, there’s an implicit sell there. If you talk in terms of owning it, it’s just a case of, I want to accumulate this and let it sit there quietly and protect my purchasing power, and at some point in time, I’ll exchange it for someone else. And I can see a time when I own zero gold. Right now I have a lot
Mario Rodriguez 27:01
of gold coming up. Nomi Prins reveals what the Fed’s quantitative tightening has been little more than a round error, and why she believes QE quantitative easing is about to return. Plus dr Prince warns about America’s dangerous reliance on China for critical minerals like rare earths, uranium and copper, and what it means for the United States, economic and national security.
Trey Reik 27:28
Skipping to the the panel that I saw yesterday, because it was so lively. A lot of the questions that came up had to do with, you know, where we are in the cycle of the dollar and the Fed and QE and how we’re going to get out of this debt problem, et cetera. And you had a position that the Fed has really already started the process of QE. You explain your views there a little
Nomi Prins 27:54
bit. Basically. What I see is that the Fed, of course, was expanding its balance sheet during COVID and then started to contract its balance sheet and last balance sheet in the last couple years by monthly roll down of the treasury bonds that it has on its balance sheet. So that just means that a rolling off. It basically means they just let bonds mature and they don’t replace them. It doesn’t mean they sell them because they didn’t want to sell them. That would freak out the treasury bond holders in the market. So they sort of had an orchestrated roll off. That roll off has trickled to merely five to $10 billion a month as of two FOMC meetings ago. That is like a rounding error on a $6.8 trillion book of assets. So to me, just looking at that number in the context of the size of the assets and the fact that there had been a bigger roll off before that, it kind of indicated the Feds in that neutral zone. And if you take rounding error out, it means that QE is basically the next
Trey Reik 28:59
step, so that Qt started at 75 billion per month, and then I remember there was an interim 35 billion, but you’re suggesting that in practice, it’s already down under 10 billion. Well,
Nomi Prins 29:11
they said it would be 10,000,000,002 FOMC meetings ago. Oh, I
Trey Reik 29:16
didn’t know that we were still at the 35
Nomi Prins 29:18
No, see that that’s the whole thing. So they basically did announce it in between everybody watching for whether there was going to be a rate cut again this year, which hasn’t happened. So instead of doing that, they, you know, they basically focused on the long end. Because what’s happened is, is rates came down by 100 basis points last year. The long end of the curve. 10 years, 30 years, have actually not come down. In fact, on certain trading days, the yields are up, and that’s a problem for servicing US debt, because the longer the debt is and the higher the interest rate is, the more the US has to basically wake up before it turns on its lights, pay its interest on its debt. So the Fed, very quietly, has been adjusting that sort of Q tape period in. And amount. And so that’s what happened a couple of film you see meetings ago, interesting. They did not, it was not the headline. It was not the headline, but, but it happened. It’s in their notes, but it was not the headline.
Trey Reik 30:11
So there’s so much to talk about here. What? How do you see this unwinding in the next six to 12 months with respect to the Fed?
Nomi Prins 30:19
I think the Fed’s going to have to ease at some point. I think there is a battle of wills between, well, I think we know there’s a battle of wills between President Trump and Jerome Powell. That’s obvious. That’s on Twitter. Jerome’s keeping his sort of like, we’re not going to be politicized, and Trump saying, Yeah, you need to cut rates in different sort of language. The reality is us, growth is slowing. It was negative last quarter, so GDP was negative half a percent last quarter. The jobless claims are at two year heist as of the last print, and unemployment rate is at 4.4% that’s higher than it was going into the COVID period. So before all of that stuff happened, at which point, rates were effectively near zero. So the Fed has room to cut. I think it will cut. And I think it will look at those growth figures and think about those relative to inflation. Of course, inflation is still in that two and a half to 3% area, depending on the day, depending on the month, year on year. It’s kind of coming down a little off of that, but it’s not under 2% back then. It wasn’t either. It was like a 2.2% no one talked about it. So if you take all the numbers together, and Joe Powell is very data dependent, he talks about it on every single, you know, meeting and every single speech,
Trey Reik 31:35
he’s data dependent. Unless he’s predicting inflation that may come from Trump tariffs, right?
Nomi Prins 31:40
That could be an upside. That’s correct, then that’s a very, very good voice. They dependent on the downside of growth. So now, right? So I think given all that, given there is strain in the banking system with respect to loan delinquencies, defaults coming in, that the Fed will want to produce more liquidity for the system, and it will use growth slowing down as a reason, but not at the same time that there is some sort of a skirmish with the White House into an FOMC meeting like I think it will be when there’s quiet time. We will see those rate cuts this year, and I think we are going to have 75 basis points, if not 100 depending on how growth goes between now and the end of the year.
Trey Reik 32:19
In the discussion yesterday about how we invigorate growth in the United States, one of the points that all the panelists were talking about is how to spur business investment in the United States, and how important that is, because student loan forgiveness all the way back to the GFS, all of this free money and fiscal and monetary stuff is sort of behind us. And you made a very interesting point. I thought about how important it is for the United States to address its debt problem by developing natural resources and that type of thing. Can you give us an expanded view of that? Yeah, sure.
Nomi Prins 32:56
I follow hard assets very closely, and I have since I was working on Wall Street, where we basically structured bond deals out of nowhere with derivatives, and we see that that led to the financial crisis of 2008 to an extent. And there’s still a lot of structured deals going on on Wall Street right now, but they’re turning towards commodities and sort of real underlying assets, and that’s where the growth and financing is going on, real assets, real custody, solid jurisdictions. In natural resources, that’s where financing growth is in terms of actual growth on the public side, in the public sector side, we need to, as a country, consider how we grow the processing capacity of those natural resources. Now we have that in oil. We have that in natural gas. Natural gas is we are the top exporter for natural gas globally. We don’t have that for the really important strategic critical minerals. We don’t have that kind of processing capability for uranium, enriching uranium, either we don’t have it for rare earths. None of us can use a cell phone without rare earths. Our army, our Navy, our defense forces, cannot operate without processed rare earth products and missiles and permanent magnets and what have you. From China, our entire defense force is predicated on processing rare earths in China, for example, that can’t be a thing. And in the last couple of months, we have had executive orders from the White House that have clearly indicated that some of these critical minerals, specifically rare earths and other strategic minerals, including copper, actually, for the first time, are under something called Section 232 observation for review to see if they are critical to our defense and then potentially to either tariff or do other types of engagements around them. In order to secure the asset, the hard asset, but to grow we need to move that hard asset into physical processing capacity, manufacturing capacity, for energy, for defense, for magnets here in the United States,
Trey Reik 34:59
how did we. Get in this position is the under investment, just because we got into a yield curve, playing economy, and we got away from basic, basic industry. But how do we get in this position,
Nomi Prins 35:11
I think, and when I was on Wall Street this, this was, this was a big thing, because this entire, like, last 20 years, where we’ve been losing, we’ve lost manufacturing before that. But even this natural earth space, not really natural resource space, not really continuing forward with rare earths, not continuing forward with enrichment of uranium processes, right? I think it’s been a big gap, and I think it’s because financing in general is very short term looking. It’s short term looking on Wall Street. It’s like, Where can most amount of money be made in the shortest amount of time. These are long term projects, long term expensive projects. Now they were cheaper to do 14 they were cheaper to do in the wake of 2008 financial crisis. But the last thing strategically the US government tried to do, or thought about doing, was say, Look, our financing costs are zero right now. Let’s look at all the things that we should grow and do and be, to be more successful as a nation and to protect ourselves better as a nation and our allies, and invest in that. But that was the opposite of what happened. I spent a lot of time on the hill. I talked to congress people on both sides of the aisle. I don’t I don’t care what side they are. I care about us getting things done. And there was a couple things that were in the way. One was the permitting processes and some of the regulations that are taught for these sorts of plans. But also, more than that, the strategy, the long term strategy, was just not there. Well, China, on the other hand, said, Look, we have access to rare earths. We have partnerships with access to Uranium. We’re just going to create plants here, and that’s what they did. That was their plan. That’s where they put funding, and that’s what they built. So there was a lot of things going on that’s created this, this chasm between the countries,
Trey Reik 36:52
and I hear over and over that one of the big hurdles for what you’re talking about being developed is human capital that we that we just don’t have the people and the expertise in some of these industries. So that’ll take a while right to build up.
Nomi Prins 37:08
I think it will if we, if we’re organically growing it. But you know, we can buy human capital. This is not this is not problematic. We can have relationships with scientists and geologists around the world, and we do. It’s a question of harnessing it and having that strategic business
Trey Reik 37:27
and having the will to do it and having the will to do it. So again, whether you’re a Trump fan or not, this is one area where he’s got some good ideas
Nomi Prins 37:36
he does, and also there’s bipartisan support for it. I mean, if you take away the sort of noise on a lot of other things in which there are disagreements on Washington, nuclear power, enriching uranium, rare earths, critical minerals. These are all conversations that are had on both sides of the
Mario Rodriguez 37:53
aisle. Last but not least, Peter grozkov, he dives into why silver is primed for a powerful rally, and why gold could still climb 4000 and beyond, a timely and eye opening discussion where hard assets fit in today’s evolving financial landscape. Let’s take a listen.
Trey Reik 38:15
One last metal, which seems to be on the cusp of a pretty important breakout, is silver. You know, it’s lagged a bit since gold moved from 2800 to 3300 3500 back to 3300 silver hasn’t, sort of kept up. The gold to silver ratio got up to, I think, 105 recently, but now we’re at 36 and I know you do a lot of work in the silver market. What are your views for silver? Well,
Peter Grosskopf 38:43
silver is a much smaller market than gold, and when gold moves, silver moves more. So I think Silver’s got to catch up. I think the biggest drawback to silver, it’s actually clunky. You actually have to own a lot of it in physical volume, unless you put it in a stable coin. And I think that digital forms of storage are going to change the silver market even more than gold. So I do think it’s due for a pretty violent rally.
Trey Reik 39:13
I think I recall towards the end of 23 that capital in the resource space was was pretty precious. The business really slowed down. And I get the impression that, you know, the spigots are open a little bit more than they were back then. Yeah. What? What To what do you attribute that?
Peter Grosskopf 39:34
Well, I think we went through a pretty long bear market for all mining and commodity issuers, it may have ended when COVID started and the money printing began in earnest. However, still a lack of organized investment in the area, which has really only started to marshal itself in the last year. Year. So I think that the generalists, for instance, weren’t really buying the trend until about a year ago.
Trey Reik 40:07
And when you look at the different metals, at the stage of company that CP is financing, are there enough attractive companies, say, in uranium or rare earths, or, you know, copper that you feel, you know, there’s a coterie of opportunities moving forward.
Peter Grosskopf 40:30
Yeah, it’s easier to be a gold producer. It’s still not, not easy on the scale of one to 10. But gold is a commodity that’s produced at the mine gate and sold into a global and very liquid market. These specialty mineral producers require, I think, a little more selection. And so if we look at 20, we only find one or two that are of interest. But if you add them all up, I mean, we probably have 40 companies that I think are really undervalued in our basket now, and that could deliver exciting rates of returns to investors, even at spot commodity prices,
Trey Reik 41:15
excellent. And I think the whole thing this conference is pretty ebullient about gold, gold, gold. I haven’t heard anyone mention copper since I’ve been here, and the numbers that we’re throwing around are starting to get pretty routinely in the four to $5,000 category. And I know this isn’t your job, but as you look at the gold market, what’s your expectation for the gold price, generally, specifically, I assume you would agree we’re going higher.
Peter Grosskopf 41:48
I do, and I think we’re going higher because I’m seeing it being added in higher proportions in portfolios, right across the board, from central banks to individual investors and even the pension consultants that have been so reluctant to go to the area, it’s the only asset that is liquid and not correlated, and is somewhat of a protection against what many believe is an over extended financial system. So I just don’t see any end in sight to money moving into the sector. And you could play it’s so hard to pick an exact target, you could play it conservatively and say, well, it might correct to 3000 and then move to 4000 and that on the charts is kind of what it would normally be expected to do. But we haven’t got to the blow off stage yet, where everybody is going to need some gold, and so I don’t know what the roof for or target would be when that happens, it could be several $1,000 higher.
Trey Reik 42:53
You at the Gold Council, I know have done work on gold as a high quality, liquid asset, I believe. Hlq, do I have that right? Hlqa, hlqa, so give us Yeah,
Peter Grosskopf 43:09
yeah. So under the Basel European banking guidelines, gold missed an opportunity be deemed as an H, L, Q, a, and I don’t know how quickly that can be attained. It’s based on reporting its trading volumes, which it’s now doing. And I think the challenge had been it was not reporting those volumes, so the regulators didn’t know exactly how liquid it was. It should be a high quality asset, in my opinion, a higher quality asset than Treasury’s because it’s not anybody else’s liability, and it’s that liquid. So, you know, I would be a strong advocate that it shouldn’t attract a banking surcharge to hold it.
Trey Reik 44:01
The Basel three has been a little confusing. I was under the impression that that went into effect on July one, but you’ve given me some information suggesting that, I guess it’s in the experimental stage or it hasn’t been fully adopted. Is that? What you understand?
Peter Grosskopf 44:19
I haven’t heard that there’s any firm deal or firm guideline, but I know the World Gold Council and others in the gold industry are supplying a lot of data with arguments to the effect that it should be given a relief in capital treatment,
Trey Reik 44:34
and it’s also not your job, but I know that you spend a little bit of time focusing on debt and the Fed and, you know, the situation and the monetary system of the world. So let’s delve into this. From this angle, do you believe that the dollar standard system is already evolving to something different, a new monetary system over. Stating it,
Peter Grosskopf 45:00
is it overstate? I don’t think it’s overstating it. I think that the balance of and these things are probably measured in micro degrees, and I think the tide is ebbing away from the dollar standard, and that there’s other forms of commerce now that are highly digital and highly liquid, including cryptocurrencies, and including BRICS currencies and and I think you can see that and how central banks across the world are reacting to that SWIFT system control the US has they know and individuals know they need a hedge against being so overly controlled by the dollar and the political goals that it has. So I do, I think it’s significant, and I think it’s going to keep occurring, and it’s going to be a slow moving train.
Mario Rodriguez 45:51
I hope you enjoyed this special look at some of the incredible conversations we captured at the Rick will symposium. Remember, these were just highlights. There’s so much more depth and new ones in the full discussions. To watch all 15 full length symposium interviews, simply register it for our accredited investing list using the link in the description below. It’s free, and you’ll gain access to these exclusive insights that can help shape your investment decisions in today’s rapidly changing world. Thanks for watching, and we’ll see you next time you.
