The printed US dollar, that is, the amount of emission, and the US National Debt have a direct impact on gold pricing.
Dollar emission, that is, the amount of dollars printed, peaked at $21.72 trillion in April 2022. When the process that started with the pandemic caused high inflation, the FED raised interest rates and withdrew $1 trillion of the dollar stock spread around the world. And in October 2023, dollar emission decreased to $20.69 trillion.
After this date, the emission volume started to increase again and now it has almost returned to the amount of emission in April 2022. The emission amount at the end of December 2024 was $21.53 trillion.
There is a direct relationship between dollar emission and gold price. Regardless of market movements, when emission increases, the gold price - on average - increases at approximately the same rates.
Especially if market movements also support the gold price, the ratio of gold to dollar emission also increases. The graphical examination of this ratio is extremely important in terms of estimating the gold price.
As you can see, today the gold price is at the level of 0.136 of the US emission volume. When gold increases, this ratio also increases. In this parallel, I think that the 0.200 level seen in September 2011 will be seen again.
In fact, when evaluated for a later date, an increase to the range of 0.300 to 0.400 may be experienced. The first graph showed the period after 2000. The starting date of this graph is 1978.
Another important indicator for gold prices is the level of the US National Debt. Just like the emission volume, this also constitutes an important data package. Today, the US national debt is at the level of 36.22 trillion dollars, a figure much higher than the dollar emission.
There is a similar relationship between the US National Debt and the gold price as the emission amount, but in some periods one can be at higher levels, and in some periods the other can be at higher levels.
You can follow the course of the last fifty-five years from the table. Pay attention to the Gold/Debt Ratio in the last column. The bottom level was reached in 1980 at 1.32. In other words, the price of gold climbed to its peak against the US National Debt on this date. In 2000, we see that it reached 20.40, meaning that gold was a very cheap commodity at the beginning of the new millennium.
An increase in the Gold/Debt Ratio means that the price of gold is getting cheaper, and a decrease means that it is getting more expensive. Today, we are at 12.45. It is certain that gold has risen compared to two years ago, but the Gold/Debt Ratio still maintains its high level. Therefore, it can be said that there is still a wide area ahead of us.
In this context, I will finish by making additional predictions for the end of 2027. You can see these in the last three lines.
If the ratio of gold to the US national debt falls to 10% by the end of 2027, this will mean a price of at least $5,270 for the price of gold. Especially if this rate drops to 7.5%, the ounce price of gold will rise to 7,027, and if the rate drops to 5%, the ounce price of gold will rise to 10,540 dollars.
These figures are more than just predictions, they are conditional propositions. Just like "if this happens, this will be the result".
Stay tuned. Best wishes...
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