Gold Price Market — Could a US Constitutional Crisis Be Good for Gold?
What is the actual market price of gold and silver?
This question stumps many people.
Most will simply say it is the price quoted in US dollars. Commodity prices are officially quoted this way.
But this is not entirely true. The US dollar does not have a fixed value. Its value is relative to other currencies.
The US Dollar Index measures the value of the US dollar against six other major currencies. The euro, the British pound, the Japanese yen, the Canadian dollar, the Swiss franc and the Swedish krona.
A higher US Dollar Index means a stronger US dollar. It reached its peak in early 2002 at 120 and was at its lows in mid-April 2008 at 71.
However, very few people pay attention to the US Dollar Index. Therefore, they do not get the full picture of the actual market prices of commodities.
The current price of gold is US$1,855/oz, while the US Dollar Index is 90.55.
You can calculate the actual market price of gold by multiplying the US quoted price by the US Dollar Index, treating the index as a percentage.
The actual market price for gold is therefore just US$1,855 x 0.9055 = US$1,679.70.
Let’s call this the ‘US Dollar-Adjusted Gold Price’. For context, I will show you how it has performed since 2010 in the figure below:
Source: Thomson Reuters Datastream
In September 2011, the price of gold hit a record high of US$1,921/oz. The US Dollar Index was weak at that time, sitting at 75–77. The USD-Adjusted Gold Price was just shy of US$1,500/oz.
The gold bear market in 2013–15 caused gold to trade between US$1,000–1,100/oz.
You can see that the actual price of gold broke the 2011 record since June 2019. It has remained above US$1,500/oz since.
I believe we could soon see the USD-Adjusted Gold Price rise even further.
It has to do with a constitutional crisis that is brewing in the US.
The corporate media is doing its best to avoid talking about it.
The politicians are busy trying to suppress it.
But it is now beyond their control.
The US 2020 election is far from over
Many have come to accept that Joe Biden is the duly elected 46th president of the US. He ‘won’ with a record 81 million votes.
The Democrats, social media and corporate media have called the election ‘most secure and fair’. They label those wishing to contest the results as ‘treasonous and seditious’. Another popular ad-hominem they use is ‘far-right conspiracy theorists’.
You will not hear about it, except for Rachel Maddow on NBC claiming this is all sparked by ‘QAnon conspiracy theorists’.
Trusting your eyes
If you were like me and watched the election vote counting live, you would not be able to accept these results.
Many focused on the swing states of Arizona, Georgia, Michigan, Nevada, Pennsylvania and Wisconsin. Almost every state saw President Trump maintain a solid lead as they counted the votes for some 4–5 hours.
I was looking at Rhode Island and Virginia; two states where President Trump had more than 50% of the votes in early counting. They were coloured blue as if the media companies knew it was a Democrat win.
Of course, there were the ballot dumps in Michigan and Wisconsin of more than 100,000 votes in the wee hours of the morning. And then you had votes continuing to come in for a week in these states.
They are supposed to be mail-in ballots that were counted in record time — almost all for Biden.
Something did not seem right.
Shutting out the hearings — what have they got to hide?
People picked up several abnormalities about the election.
The US Supreme Court, State Supreme Court and several courts even refused to hear these cases.
All these are supposed to mean everything is fine. You decide for yourself.
Meanwhile, state legislatures held hearing sessions with election officials, witnesses, and even concerned state and federal Congress members. Evidence of ballot tampering, machine errors, missing documentation and other inconsistencies emerged.
The US Constitution is about to show itself to be a very powerful system.
Crisis of truth
The Founding Fathers who drafted the US Constitution knew that a system is only as good as the scruples of its rulers. That was why they designed the power structure to be a bottom-up system rather than top-down.
The state governments are about to show their true power.
The hearings from the state legislatures in several swing states revealed the need for forensic audits of the ballots.
Arizona has authorised a full forensic audit at Maricopa County, which cast more than two million votes of the state’s 3.33 million.
It is about to wrap up.
What is a forensic audit? A forensic audit tracks every ballot from its start to end. They reconcile what is cast on paper, what is recorded on the computer and even traces the source of the ballot paper in terms of the printer. This audit also looks at the data transfer to ensure its integrity.
This is much more than a regular audit of checking the votes counted are correct.
Mike Lindell has appeared on a video titled ‘Absolutely 9-0’ (watch here), stating that the US military captured the data transmitted in real-time on the night of the election as they counted the votes.
You can choose to believe or dismiss this.
Corporate media has done their utmost to hide, censor and control the narrative through ‘fact checks’. They own the narrative of the ‘most secure and fair election’. Any mistakes are data glitches and certainly not enough to overturn the results of this election.
What they are doing on the ground seems not to add up, though.
The Democrats also sent more than 70 lawyers to Arizona to push for the forensic audit to not proceed. Corporations have threatened to boycott states that change voting laws or approve forensic audits. Even Attorney General Merrick Garland has said late last week that he would seek to scrutinise the audit process to ensure nothing is violated.
My question is, what is there to stop if the Democrats won fair and square?
They should welcome and even initiate the process to make the doubters eat crow.
There would be nothing left to doubt.
My guess is that they know their game is up. This could be the biggest Constitutional crisis we will see in history.
An opportunity for gold
What does this have to do with gold?
Go back to the USD-Adjusted Gold Price. A US Constitutional crisis will likely bring down the US dollar, but not the price of gold. Rather, I could see gold rise significantly as a result.
Also, this is a massive black swan event. Gold thrives in such circumstances.
I know what I am putting my confidence in.
It is not in a corrupt system.
Editor, The Daily Reckoning Australia
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