Breakout Alert!, page-24

Morning Guys,

I was out biking this morning and came across this piece of recent graffiti in my neighbourhood ...




It is, IMO, highly relevant to our discussion re the setup for gold and the rise of the socialist movement in the West. This anecdote (image above), is just one signal that there is a growing resentment towards capitalism, inequality and wealth. Politicians throughout the West are picking up on this and proposing more distributive policies - effectively increasing the tax for those that earn/ have wealth and distributing it to those who don't.

This post is not to moralise the subject ... but instead to observe what is occuring.

In turn, this is likely going to lead to private individuals to look for ways that they can legally protect their wealth from an increasingly onerous tax regime by their Government. In a digital age, physical gold is one of the last remaining places to opt out of the financial system and Government oversight. However, as Simon Mikhailovich (U.S. gold fund operator) has stated previously in RV interviews - "that time has come and gone in the U.S."

The anecdote above adds to a number of bread crumbs, including Jeff Gundlach's recent RV interview, in building the case for an increase in physical gold demand in the years ahead by Western private investors - a demand driver that has been sorely lacking in recent years.

What will be interesting, IMO, is what will happen when this demand emerges only to find that stockpiles of physical gold held in the West have dropped materially over the past couple of decades (headed East) and the annual production from gold mines falls off the proverbial cliff in the mid 2020's as per CIBC data.

Cheers
John