Inflation trends since 2018 mirror the years from 1970 (see...

Inflation trends since 2018 mirror the years from 1970 (see image below) but at a lower absolute rate. If the trend from now continues to be similar to the 1970s then watch out for the POG to rise much more in the next few years.

The incompetency of current governments and central banks is certainty indicating we may be heading for similar inflation trends as the 1970's going forward. The big picture, not the micro ones that everyone focused on, is we have increases in tariffs, increase in government subsidies, we have the green revolution leading to strong demand for most commodities, lack of investment in fossil fuels which will reduce supply in future years below demand, huge budget deficits in many countries especially the USA, rampant money printing especially the USA and onshoring of manufacturing in many countries - each of these factors are inflationary and added together are very inflationary

Central Banks and governments are kidding themselves future inflation will be at central banks target rates with all the above pressures - this will lead to much higher interest rates over a longer period and probably much higher than we have today. The impact from many of the above factors are in its infancy eg higher commodity prices from green revolution, onshoring is just starting, tariffs look like they will go higher, oil and gas prices to date have had limited impact from under investment.

The US fed is slowing its QT and has actually been adding to money supply since about October 2023 not the reduce it had been pursuing up to that date and hence increasing money supply has been causing higher inflation in 2024 than expected. This has added more liquidity to the us financial position leading to higher share prices.

The image below comes from Heresy Financial which seems to provide relative more sensible commentary on economic matters than many which hype their own agenda.

Added to all this are the geopolitical tensions which are causing many central banks to acquire gold in large volume. .

I cannot see the POG going forward going down over the next few years (but it ill be volatile) under the above environment unless governments change their current courses. With a lot of countries wanting to move away from the US dollar for various reasons (ie not just geopolitical) the problem is there is no real feasible alternative to the US dollar as the world's reserve currency as there were in past historical periods when there were changes from the then reserve currencies - all this may possibly result in gold going much much higher in future years as possibly the only alternative (the IMF has classified gold as a tier one asset - not sure if they have classified any other asset as tier one).