In this week’s “Resource Heads”, I tell the increasingly concerning story of the rising energy prices in Belgium, but also across Europe. I talk to Menachem Sahler about the difference between money & wealth, MMT, and we discuss whether government spending really causes inflation. Patrick Karim shows me an interesting ratio on gold, and explains to me why he thinks the gold bull market is only just beginning. Finally, Dr. Quinton Hennigh walks me through the technical results of Skeena Resources.
10 Things to Know
- Average Belgian family will soon have to pay up to $9,000 per year on gas & electricity, if the prices keep rising like they have been. This will leave many families close to or unable to covering their basic expenses like shelter, energy, food, transportation, etc.
- Zero hedge chart shows that when oil spikes as much as it recently has, we often go into a recession after that.
- Rising energy & food prices can cause short-term bad inflation, which is long-term deflationary.
- Money is a tool for accounting and saving productivity. Money could be used to build wealth, when used to buy or build productive assets that add to the value of the collateral.
- Wealth is productivity, or the ability to produce what we consume, or more than that.
- Government spending doesn’t cause inflation nor deflation because when the government spends money, there is no new money introduced into the system. The government simply gets that money by selling bonds, and taking in money that was already existent. When there is government deficit spending, no new money is introduced into the system, therefore that’s not where inflation or deflation starts.
- MMT wouldn’t work because governments are notorious for spending money unproductively. Giving governments the ability to print money so they can spend it, results in a high risk for the government to cause bad inflation, which might result in a recession.
- The ratio between Gold and Gross Domestic Income shows us that we’re nowhere near the top. The bull run has started but we’re very close to the bottom in gold prices. History shows us that this bull run in gold could continue for another seven years.
- Skeena Resources is publishing some promising grades, over long intervals. This could mean a lot of high grade gold is in that area.
- Next week, I’m talking to FireFox Gold, and a nuclear plant operator with boots-on-the-ground experience. Any questions are welcome on the Discord server. The server is not free, though. Here’s the link.
Please read this, and the full disclaimer over here, it really is important and for your own good:
This video should not be considered investment advice of any sort. The contents of this video are general and impersonal in nature No trading recommendations are being made in this article. Be diligent and do your own research before risking your capital. The investment decisions of the author are based on their own investor profile. This includes, but is not limited to, their risk profile, their cash balance and their debts. The author likely has a higher risk appetite than yourself. That’s why you may never assume anything on this website to be personally tailored to your situation. Resource Talks, nor the Author of this article are a registered advisory service and we do not give investment advice. Our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity or any other financial instrument at any time.
Timestamps:
00:00 We are all in trouble, here’s why
07:35 What is money?
09:10 What is wealth?
13:10 Why government spending doesn’t cause inflation
14:50 Can MMT work?
21:00 Gold-to-GDI ratio, and where gold is going
27:45 Skeena Resource results
35:40 Why didn’t Skeena’s stock price move?
