It’s a special edition. Never before have we invested so much time, energy, money and passion into this report. Never before has the team for the report been so large. And never before have we analyzed such a broad spectrum of topics. For the first time, we are publishing the In Gold We Trust report in China, for a market that is becoming increasingly important for us and for the gold industry. But it is also a special vintage because we have chosen a theme that is of the utmost importance for both interpersonal cooperation and economic prosperity. The term is so crucial that it is an integral part of the name of our annual publication: trust.
Trust is the basic value of interpersonal cooperation and the cement of our social order. The erosion of our “trust capital” can be observed in many areas of society.
• The breakdown of trust in the international monetary order is manifesting itself in the highest gold purchases by central banks since 1971 and the ongoing trend to
repatriate gold reserves.
• Gold reaffirmed its portfolio position as a good diversifier as trust in the “Everything Bubble” was tested in Q4/2018. While equity markets suffered doubledigit percentage losses, gold gained 8.1% and gold mining stocks 13.7%.
• The normalization of monetary policy was abruptly halted by the stock market slump in Q4/2018. The “monetary U-turn” that we already forecasted last year
has begun.
• Recession risks are significantly higher than discounted by the market. In the event of a downturn, negative interest rates, a new round of QE, and the implementation of even more extreme monetary policy ideas (e.g. MMT) are to be expected.
• When it comes to trust in investments, our vote is clear. Trust looks to the future, forms itself in the present, and feeds itself from the past. Gold can look back on a successful five-thousand-year history as sound money.
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