Gold will benefit from Trump’s escapades even longer – DiePresse.com

Since the gold price after years of sideways movement the mark of $ 2000 was able to skip the 2000 dollar in the previous year, he no longer seems to know. One record high followed on the other until you had to put almost $ 3400 down for 31.1 grams of the precious metal. The demand has reached a new record level annually 4975 tons, Jürgen Lukasser, Deputy Cio at LGT Private Banking. The demand for jewelry – 47.5 percent of the gold flow into this industry – recently weakened, while demand is increasing from the central banks. This is a clear sign of the increasing importance of gold as a strategic value memory in economically uncertain times.

Buy Russia, China and Türkiye

Gold differs from other precious metals such as silver, platinum and palladium in that only a very small proportion of industry goes. For this, it is asked much more by investors, both from those who buy bars or coins directly, as well as investors in securities who are underlaid with gold. The central banks invest exclusively in gold and no other precious metal. They stand for 15 percent of gold demand. While the stock of the United States – the country has not changed by far the most gold – the stocks of Russia (currently 2336 tons), Chinas (2280), Turkey (765) or India (822) have been growing rapidly for decades. « You saw what happened to the Russian assets that were confiscated as a result of the Ukraine war, » says Lukasser. That’s why you prefer to put yourself in gold in the safe. Germany (with 3351 tons of the second largest owner), Italy (2452) and France (2437 tons) have recently kept their gold stocks rather constant, Switzerland has been on the seller side since the turn of the millennium and has only 1040 tons.

The question that arises: Are the central banks ready with their purchases? No, says Lukasser. If you set the gold reserves of a central bank in relation to its foreign exchange reserves, this value is at least 60 percent in Germany, France or Italy, but in China it was only five percent, nine in India, in Russia. « The Chinese are far from finished with their purchases. »

« No inner value »

But how high will the gold price still rise? While the experts of the « in Gold We Trust » report by Incrementum, Ronald Stöferle and Mark Valek, at the end of the decade with a gold price of $ 4,800 and even in an « inflationary scenario » with $ 8,900, Lukasser does not want to make a price forecast. Gold has no inner value, but only an exchange value, he says. Compared to other bull markets since 1971, as US President Richard Nixon The coupling of the US dollar has lifted gold, the current high-altitude flight was not particularly far from the duration or the increase. So it could continue much more.

The expert refers to the recent escalation between the US President and Elon Muskhis former supporter and current opponent. Musk wanted to put the state institutions back. He did not succeed in the extent that he would have liked to have, but the institutions were examined. Lukasser states with a side effect: they are now damaged. Since the dollar is a Fiat currency and depend on trust in the institutions, it weakens. He will continue to do so if Trump, for example Jerome Powell ends, a successor chose who supports Trump’s politics more and drives a very relaxed monetary policy. That could weaken the trust. This crisis of trust is already evident in the fact that the dollar falls to the euro, although interest rates in the United States are 4.25 to 4.5 higher than in Europe (two percent) and the difference tends to be larger.

What if everything gets good?

But what could be the increase in the gold price? « If everything is fine, » says Lukasser. And the likelihood of this is currently low. However, he admits that the gold price is subject to strong fluctuations. He fell in the 1980s and 1990s. Was everything good back then? At that time the economy grown up, new technologies were created, President Bill Clinton At times I got budget surpluses that the Cold War ended and the institutions-such as the US Federal Reserve Fed under Alan Greenspan-had enjoyed the greatest confidence.

The United States is now growing two trillion dollars of new debts per year. The new budget draft, which also has escalated the dispute between Donald Trump and Elon Musk, will not lead to savings. The United States could also come from its debt misery due to high economic growth. But the customs threats and the trade conflict would have worked like a braking. Companies held back with investments, and consumers would also prefer to postpone purchases. « Maybe it will get better in the second half of the year, » says Lukasser. The gold price would still not suffer, because the Chinese would use any reset for purchases. « There is still a lot of room for improvement. »

In any case, gold is a good diversif for the depot, says Lukasser. In the 1980s and 1990s, the stock markets rose sharply. But how much gold do you actually need in the depot? Most asset managers advise an admixture in the medium single -digit range. However, they mostly cover these with gold securities. If you really wanted to secure yourself for times of crisis, you should also put gold in a physical form in the safe, advises Lukasser. How much is up to you. But if you want an effective crisis insurance, four percent are rather little.