Honest Money: The Power of Gold in Monetary Systems
Aug 21, 2023
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Guest Keith Weiner, Founder and CEO of Monetary Metals, discusses gold's stability and attractiveness for conservative savers. They also cover stress in the bond market, recession signs, and the debate of gold versus bitcoin.
Gold's stability and enduring history make it an attractive choice for conservative savers.
Blockchain may have specific applications, but it is unlikely to replace the global banking system.
Inflation should not be reduced to a statistic, as it has real-life consequences on individuals' savings and purchasing power.
Deep dives
Gold and Bitcoin: A Comparison
The podcast episode starts with a discussion between the host, Dan Ferris, and Keith Weiner about the differences between gold and bitcoin. Keith emphasizes that gold has been a trusted monetary asset for thousands of years, while bitcoin lacks stability and cannot function as a stable currency due to its extreme volatility. He argues that bitcoin primarily operates as a speculative asset rather than a reliable form of money. Keith also mentions that gold has a proven track record of preserving wealth, being used by families for generations to protect their savings.
The Role of Blockchain
In the podcast, the concept of blockchain is discussed. While Keith acknowledges that blockchain technology has interesting and important applications, he is skeptical about its potential to replace the global banking system or revolutionize the world. He suggests that blockchain may be more suited for specific purposes, such as supply chain tracking and provenance verification. However, he does not believe it will fulfill the role of a credit intermediary, which is a key function of banks.
The Importance of Understanding Inflation
The episode concludes with a thought-provoking discussion on inflation. Keith highlights the danger of reducing inflation to a statistic, emphasizing the impact it has on individuals' lives. He refers to a quote attributed to Stalin, where he states that one death is a tragedy, but a million deaths is a statistic. Keith warns against dismissing the real-life consequences of inflation by focusing solely on numbers, and encourages listeners to consider the true effects inflation can have on their savings and purchasing power.
Gold as a Hedge Against Central Bank Power
Keith discusses how gold can serve as a hedge against the centralized power of government and central banks. He highlights the importance of honesty in the financial system and how gold, as a physical asset, provides a counterbalance to the fiat currency system. Keith explains that gold is not part of the centralized financial system and is not reliant on valuing it in dollars. Instead, he focuses on the idea of owning gold as a means to preserve wealth, avoid counterparty risk, and protect against a potential collapse of the currency system.
The Significance of Gold in Uncertain Times
In this episode, Keith emphasizes the significance of gold in uncertain times, particularly during times of economic instability and monetary policy interventions. He talks about how gold has historically maintained its value, comparing it to other currencies that have experienced devaluation or collapse. Keith also discusses the rising interest in gold as an alternative investment for those seeking to diversify their assets outside of the traditional banking system. Despite being often ignored or unloved in mainstream markets, gold continues to hold its value and is considered a safe haven asset during periods of financial crisis and heightened market volatility.
On this week's Stansberry Investor Hour, Dan and Corey are joined by Keith Weiner. He's the founder and CEO of Monetary Metals, a gold investment firm. But first, Dan and Corey kick off the podcast by discussing the potential implications of stress in the bond market, and how bond yields have been showing signs of movement. Plus, they highlight that the yield curve could be signaling a recession sign. (00:00)
Next, Keith joins the conversation by sharing his beliefs on gold and the world's monetary system. He starts with his "origin story," describing how he founded and then sold a successful software company. Then Keith and Dan shift gears to dive into the current state of the economy. With three of the largest bank failures in history this year and the U.S.'s credit being downgraded recently, they discuss how this may be affecting people's attitudes toward gold. (18:34)
Finally, Keith goes on to share his insights on the debate of gold versus bitcoin. He emphasizes that gold's stability and millennia-long history of wealth preservation give it an edge over any cryptocurrency. While bitcoin has seen speculation and massive price fluctuations, gold's enduring stability makes it an attractive choice for conservative savers, even in times of economic uncertainty. (40:53)