Rebel Capitalist News You Won't Believe This...The Fed Might Do GOLD QE
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Oct 1, 2025 The podcast unfolds a striking proposal for the Federal Reserve to consider 'gold QE.' This could involve revaluing U.S. gold reserves to current market prices, potentially funding the Treasury without incurring new debt. The discussion highlights the financial mechanics behind this idea and its implications for bank reserves. Legal constraints and market reactions are examined, along with the critical role of commercial banks in the money supply. Listeners are left intrigued about how such a bold move might play out in times of crisis.
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Gold Revaluation Could Fund Treasury
- Revaluing US gold reserves to market price could legally increase Treasury assets by ~ $900B–$1T on paper.
- That revaluation could let the Fed place reserves into the TGA, effectively funding spending without new debt issuance.
Wait For A Steep Curve To Use The Option
- An inverted yield curve signals strong demand for Treasuries, reducing urgency to deploy an extraordinary funding trick now.
- George argues the Treasury should save any gold-revaluation option for a future steep-curve crisis when supply truly matters.
Gold Swap Resembles QE Mechanically
- Swapping gold for reserves on Fed books is analogous to QE because an asset increase pairs with new reserve liabilities.
- The net effect resembles the Fed buying treasuries except the asset is gold instead of bonds.