WARNING: Historic Financial Reset Imminent, Gold To Rally | Mike Maloney
Summary
Macro Outlook: The guest expects a looming global financial crisis with simultaneous bubbles in stocks, bonds, and real estate, citing excessive debt and an overextended Fed balance sheet.
Precious Metals: Strongly bullish on precious metals, emphasizing central bank buying, rising physical demand in Asia and India, and the role of gold as an asset with no counterparty risk.
Gold: Sees gold in the final phase of a multi-decade bull market with potential for sharp upside; references major institutions turning pro-gold and price targets reaching into five digits.
Silver: Argues silver is deeply undervalued versus gold, highlighting the gold/silver ratio near historical extremes and expecting a move toward 20:1 or below, implying silver outperformance.
Market Signals: Notes physical demand-led price action, especially in Asia, while Western investors have been net sellers; views this as a wealth transfer from West to East.
Risks and Cracks: Points to rising auto loan repossessions and the end of commercial real estate forbearance as early stress signs that could accelerate a broader downturn.
Monetary Regime: Discusses potential steps toward re-monetizing gold or partial gold backing, which could rapidly shift trust and capital toward gold-linked currencies.
Portfolio Implications: Suggests that institutional shifts from bonds to gold (e.g., 60/20/20 frameworks) could drive substantial additional demand for gold, reinforcing the bullish thesis.
Transcript
Special coverage from the New Orleans Investment Conference is brought to you [music] by First Majestic Silver Corp. There's no substitute for silver. Hello and welcome back to Soore Financially here from New New Orleans Investment Conference. My name is Kai Hoffen. I'm the Edj Mining guy over on X and of course your host of this channel and I'm joined by none other than Mike Maloney. Mike, it is such a great pleasure to have you sitting here in this chair. You're the founder of golds.com. You're an accomplished author, best-selling author. Her latest book is The Great Gold and Silver Rush of the 21st Century. We'll get to the content of the book and how it applies to what we're doing and talking about today in a minute, but first just thanks for being here. >> Well, thank you. This is actually the first time I've been to this the New Orleans Investment Conference, and it's actually quite something. And you know, we've had such a runup in gold and silver uh recently. So, there's an excitement going on here uh that is great to see. uh all of the things that I wrote and you know my first book uh I was with Robert Kiasaki and the Rich Dad group and so it was written from 2002 uh through 2007 and it came out in in 2008. Uh and [clears throat] all of the things that I wrote about then and the things that I wrote about in my last book which came out in early 2000 in 2023 are starting to come true right now. And it's it's time to get prepared, that's for sure. >> Let's dissect that together a little bit. Let's start on the macro side. We'll make our way down to the micro, meaning the precious metal prices and price moves. But um maybe on on your assessment, 30,000 foot view, like what's the state of the economy? What's the state of the financial markets? >> Uh the state of the economy is I hate to say it, we're screwed. [laughter] That's that's what it you you look at what every president has done and they run on a platform. and they're going to reduce the budget deficit. They're going to balance things. And then as soon as they get into office, they go exactly the opposite direction. Uh because the population likes it when you're handing out free candy. And uh that's basically uh what they're doing is they're keeping the population appeased at the expense of uh the I hate to say it but you know we're we're I I do think that we are headed into a huge global financial crisis. Uh in 1929 the stock markets were in a bubble. uh in 1966 stocks uh were in a bubble and they worked their way off. The Dow bumped its head on a,000 points in 1966 and couldn't break out until 1982. So stocks went sideways during a period of raging inflation. And so corporate profits and stuff went up during that period of time. And so all of the PE ratios and the indicators that tell you whether stocks are in a bubble or not worked themselves off. So we we had a correction without a crash. But the first time it was stocks moving, gold was fixed. Uh the the and real estate was not in a bubble. The second time it was stocks, real estate was not in a bubble in 1966 to 82. And then we had the uh NASDAQ the the tech bubble of 1999 2000. Again, stocks in a bubble but not real estate. Uh and and uh then it was both you know from 1971 um uh to 19 when gold became free trading. It was only gold moving that caused this correction in the uh the uh gold to uh the the like the Dow gold ratio the stock market to gold. It was only gold moving. This time it's both gold uh and the markets are moving. Uh we've got uh you know in in 2008 the global financial crisis stocks had already been beaten down from the 1999 2000 tech bubble popping and so uh stocks were just above the stock market uh was above fair value. it it never was allowed. Ben Bernani papered over all the cracks and it was never allowed to go to undervalued so that we built a solid base again. What they did was they just as as everybody knows created tons of currency. Uh they exceeded my wildest nightmares when because I had written all about this and about his response to the next crisis in my book that came out just months before that before it all happened. Uh but um uh this time stocks are in a bubble, bonds are in a bubble and real estate is in a bubble and these are bubbles of historic proportions. Uh the the only way that you can measure the stock market that shows it uh not in the greatest bubble in history is PE ratios. All of the other measures, the Buffett indicator and and uh the different ways of measuring it, uh all show it in the greatest bubble in history. Real estate, same thing. And then uh bonds, uh you know, we've we had a a bull market in bonds from 1980 until uh just the past couple of years. So bonds are also >> 40ear bond bull market in bonds, right? >> Exactly. Exactly. And so uh when these you can't [clears throat] have something go into a bubble where it's out of whack with the rest of the economy permanent. It can't stay there permanently. Something has to happen. Either the economy has to grow to match it and that's not very likely or there has to be a crash, a correction. And so, um, uh, we're going into this next big crisis with 38 trillion dollar worth of debt and with, uh, the, uh, Fed's balance sheet already expanded so much. Uh, in a 2015 update to my first book, I I wrote that, uh, you know, there the next time that they do QE, they're starting it from a base that is already so high. there was $800 billion in uh in the uh bank reserves and uh in base currency. Base currency is the cash in your wallet plus bank reserves. And uh it peaked at 9 trillion. And so uh uh we're just we're off the rails. >> Oh, we we definitely are. We definitely are. But then again, like how how much longer can it continue kicking the can down the road? Um because we we were sitting here fortunately gold is caught up now otherwise we'd be still people would call us liars. Right. >> Right. Like >> yeah gold is make it's it's the alarm bells going off right now. >> I was going to say like what kind of signals do you take away from that? What is gold and silver signaling and gold in particular probably signaling to you right now? >> Uh central banks are still buying it. It it definitely has not peaked. uh in this uh last runup it was basically uh Asia and uh a little and India uh pushing the gold price and it was physical demand instead of all the gambling on the commodities exchange and the LBMA. Uh and so uh it's it's telling me that we're getting closer and closer to a crisis and it it has it's impossible for bubbles to to uh just go on forever. So, we're at a period of time where, you know, they are trying to kick the can down the road, but with things at the extremes that they are at right now, uh, I I'm expecting something within the next year or so. I'm actually surprised that we got through October uh, with no big event. October is always that spooky month. >> Always something. A black swan loves October, >> right? Yeah. >> Right. Now, um, how much cushion do you think there is in the system? like you you mentioned the Fed balance sheet, you mentioned the $ 38 trillion in debt. Is there even any cushion left to absorb a massive shock that you're hinting at here? >> Uh I don't Well, the thing I wrote when I updated my uh first book in 2015 uh was that they're going to need to do the same percentage increase, not the amount of printing, the QE, but the percentage increase to try and stave off anything. But remember, like I said, in in uh 2008, the stock market wasn't in a bubble. That was a real estate problem only, and it affected the stock market. This time, it's real estate and stocks. And uh it's it's turning out that, you know, everybody was expecting commercial real estate uh to do a correction. Well, uh that has all been uh put off with forbearance and uh and uh rewriting the mortgage agreements and uh um and uh that is all over with now and they can't really kick that can down the road any further. Uh I'm really expecting something horrific actually. >> Well, we're seeing some cracks on the subprime mark in the supply market, the auto supply. We've been seeing that just the last few weeks sort of seep through here. $1.7 trillion supreme lending market on the auto side. Is that where you're looking for cracks? Is that maybe potential domino? >> Yeah, there's the the number of repossessions of cars has just exploded. And then the number of people uh searching you know internet search terms for help with mortgage uh basically uh you know um the search terms for do you remember during the 2008 global financial crisis there was jingle mail. You put the keys in the envelope you mail them back to the bank. The house is theirs. Uh so all of these search terms for things that these nobody should be searching for uh how to consolidate debt u manage their mortgage payments uh um how to uh give their car back to the bank uh if the economy is healthy. It's not healthy. the underlying economy has the stock market completely detached from the real economy a couple of years ago and it's everything is is like fake right now. It it definitely feels like that and uh now gold you you touched on gold is telling us something here but the runup in gold was quite significant like was gold outperforming maybe the expectations um when you look at price performance versus underlying let's let's say economy or markets um because the move was quite violent. >> Uh it was nothing compared to the final months of 1979 and the first month of 1980. It was absolutely it was an insignificant move. Uh actually um in my book the great gold and silver rush of the 21st century uh I uh quote several articles from time magazine back then and uh there are there was a um an economist uh I can't from the 1800s uh his last name was Gifin I can't remember his first name right now but he proposed that there's a certain class of goods gifan goods they're called that um where price demand uh uh balances don't work. It's exactly the opposite. So, as the price goes up of something, usually anything, there's less demand because people can't they look for a less expensive alternative. Gold and silver violate that. We just saw that with with this runup. Uh this runup was largely caused by physical demand in Asia, uh Australia. It was interesting in the United States. Uh we weren't participating yet. In fact, there was a lot more sales than buys and refiners in the United States got all clogged up. Uh >> I've been hearing month of August a lot more selling than buying because gold shot up. This is what I'm hearing from the bullion dealers. >> Yeah. They think they're taking and they're the people that are selling are going to regret it one day. They really will. Uh it is sad to see the east buying and the west selling because it's a wealth transfer that is going on. And uh you are going to we are nowhere near the top of the precious metals markets. And the things that tell you that are things like the Dow gold ratio, the gold silver ratio. In 1980, uh when gold and silver peaked on the same day, uh the ratio between gold and silver, it took 14 ounces of silver to equal the value of 1 ounce of gold. And that is about the natural the natural ratio is that there's about 19 times more silver in the earth's crust than there is gold. Uh silver tends to occur more up toward the surface and gold is deeper. And so when we would dig it up back then, the reason that the gold silver ratios averaged about 15 to1, you know, somewhere between 13 and 16 to1 all over the planet was simply because if you've got a certain number of coins in circulation, you got 13 of these silver coins for each one of these gold coins in circulation. It's the free market >> finding this equilibrium, the exchange rate. And uh um right now at 85 to1 I think is what it's at. And during co it's shot up to 120. It's never silver has never been that cheap compared to gold. And uh I do believe that you are absolutely going to see the gold silver ratio at 20 or less. So that means silver's value rises compared to gold. So it doesn't mean gold is coming down and you you think silver is catching up remaining it's >> well this is exactly what happened back in 1979 silver lagged for the the bull market of the '7s and then just suddenly uh when gold started becoming perceived as too expensive and today $400 doesn't sound too expensive but you got to remember in in n before 1980 the average income in 79 was like $9600 a year in the United States And so, um, uh, gold had gone from $35 in just in in less than eight years. $35 to $400. And, uh, so the average guy, if he's if he's in his 40s, 500 bucks may have been the majority of his savings. I don't know. But he goes into the bank, takes out $500, rushes to a coin shop, and says, "I want to buy gold, too." And they drop one coin in his hand. And at that point, he goes, "Oh, is that all I can get? how much is the silver? And it's when the public changes their preference from gold to silver that, you know, people blame the the $50 uh silver price in 1980 on the Hunt brothers. And it's absolutely not true. They added 50 to 75 cents at the most to that market. It was really the public changing their buying preference uh being silver being perceived as a better bargain. talking about buying preference and sentiment. Um the banks are changing their tune towards gold and silver right now. JP Morgan, Morgan Stanley, Morgan Stanley was the famous one saying, "Well, maybe you should consider 60 2020 as part of your portfolio construction." 20% being gold of that, right? So, are we seeing the same mindset shift that we're seeing? >> JP Morgan say prices as high as $10,000. >> Exactly. Jamie Diamond, right? Yeah. And so, uh, this is a major shift and it sort of signals that we're probably going into the third and final phase of the bull market, which is the greatest gains in the shortest period of time. Usually that bull markets have three phases. And uh, uh, this final phase, like I said, greatest gains in the shortest period of times. Well, what what are the gains that we've had so far? We've gone from 250 to 4,500 bucks an ounce. These are some huge gains already. Uh if you look at the um you know uh we created an interactive chart where we overlaid the bull market of the 70s uh with the bull market of today and then there's something called Elliot wave analysis and you take these waves the first wave uh wave uh I I can't remember whether it's AB and C or if it's one two and three but I >> think it's one to five up to five right is it I'm not an expert >> one two three or 1 2 3 4 five. Yeah, it's either three or five waves. >> Uh and um you when we match those the the very bottom and that top up, it was projecting that uh the this bull market would be 2.6 times greater in magnitude and 3.1 times longer than the uh '7s bull market. But it was projecting 9 $10,000 an ounce gold. And it's [clears throat] interesting to see these uh major banks and financial institutions, they were telling you to stay away from gold when it was 250 bucks. And now that it's $4,000, they're oh maybe you should put 20% of your part. Why? Because it's been the number one performing asset uh class of this century since the year 2000. The only thing that has outperformed precious metals is cryptos. But you know uh if you start at zero from zero to one is an infinite return. So um uh cryptos have done spectac I've been in them since 2014. I told my insiders about it recommended uh that they uh take a position in cryptos. But as cryptos go up I sell some and I take profits and turn it into silver. So um yeah I I think that we have some spectacular times ahead of us now. Can you imagine if Morgan Stanley is this 6040 portfolio with 60% equities and 40% bonds and they're saying sell half of your bonds and convert that into gold? >> That's now if that happens you're talking prices way north of $10,000 an ounce. >> Just the amount of trillions of dollars. What what's the global bond market or the even the retail bond holdings? >> It's huge. Um my research assistant Alan Hibbert uh who is a co-host on my YouTube channel uh he's done the calculations. >> I just think for some reason the $9 trillion pops in my head but I might be wrong on that. So don't quote me on it please >> but that's the number that pops into my head. So um >> so that much currency rushing into gold is uh something we're just at this uh point in history where everybody is looking for trust >> and gold is the that you know you hear it all the time. It's the only thing with the only asset with no counterparty risk. >> Yeah. >> No, it's true. It's absolutely true. And the central banks are buying like geopolitically. We're being told to buy it anyway and then the dollar is doomed as we're being told. >> Yeah. uh that's going to take a little while. But what's interesting about uh these types of processes is they're they go along very slowly until the day they don't and then suddenly everything becomes very fast. >> Yeah. Little by little by little and then all at once. >> Exactly. >> And Shakman likes likes to use that and was it Hemingway who originally said it. So no, it's it's it's >> how did you go bankrupt or broke? Well, little by little and then all sudden >> all at once. Exactly. I think that's what we're seeing here as well. Um, >> in in terms of silver, like we're at 40% right now, a year to date. Gold is also at 40% year to date. So, silver is still trailing. Gold is what sort of I'm taking away from your commentary as well. You're going 15 1:15 ratio. 15 to1 ratio. >> Well, I own uh 300 ounces of silver for every ounce of gold that I owned because I've allowed the gold silver ratio. I don't let it dictate anything to me, but at the same time, I pay a a lot of attention to numbers and I try to keep emotion out of my investment decisions. And with the gold silver ratio at these absolutely absurd, I mean, if you look at it, for 2,500 years, it was about 15. >> Yeah. >> And suddenly, here we are in just the last century where we're visiting the levels of a 100. Uh so silver is just way way undervalued. And so um I believe that for every if if it's at 80 if you buy an uh [clears throat] if you buy a 100 ounces of silver uh you're going to be able to exchange that at at 20 for four times more gold than you paid for basically. So >> you were talking about like we are in a death spiral like we're we're doomed. any way to break out of it? >> Uh well, you know, if [clears throat] they they are the world's central banks seem to be positioning to uh remonetize gold. Uh uh Trump was when he first took office was let's audit Fort Knox. Let's make sure the gold is there. Uh there were all these signals that we could potentially end up on some sort of gold standard. Again, the problem is with the levels of debt we have, I believe it's like $140,000 an ounce >> to uh pay off the national debt and uh revaluing it to current market levels isn't going to make even a dent in the uh the the current national debt. And so uh it would have to be at at prices far higher than that. The problem with that is it will upset the world economy so much. There's going to be some sort of giant convulsion that we go through. But in my book, the great gold and silver rush of the 21st century, I sort of lay out the, you know, we had the classical gold standard uh from the late 1800s until the end of World War I. And then uh we went on something called the gold exchange standard between the wars. And then uh we went on the Breton Woods system from 1944 to 1971 and now we're on the global dollar standard. And these are vastly different monetary systems there. It's not the same at all. People just don't the the common man was unaffected by these changes because they were little baby steps off of gold. So he went from something that was rock solid to a little less of that something to less to less to none. And so now it's just air. It's faith that the dollar is going to buy you something tomorrow because it bought you something today. And uh and I I believe that now we're going to take this huge step from nothing back to something and that is going to affect everybody on the planet. Every every person will feel it. >> I was just going to ask what happens if one country or one currency is all of a sudden part at least partially backed by gold for example. It doesn't matter who it is. um what would happen? What would be the signal? >> Well, I I do think that that would attract uh more uh trade in in that there is trust with uh that country's currency. So, you're talking >> can I expand on that question? Sorry. Can can I because there's trust >> at least superficial trust in the US dollar or even the yuan. >> Yeah. >> Let's assume Zimbabwe does the same thing and puts gold partially backs their currency with gold. Is that the same thing? You know, I'm just expanding on it. The original question, can any currency back it with gold and do because you touched on the trust issue like I'm I'm very complex the way I'm trying to approach this question. Is it different if the US starts backing its gold versus China versus Zimbabwe for example? >> You know, I'm on the record for saying that gold standards suck. >> Uh gold is great. A gold standard is some sort of representation of gold. uh you know the dollar used to be redeemable in gold. So if you're talking about red fully redeemable currencies uh the classical gold standard there was a 100% reserve the treasury for every $20 bill that was in circulation there was a $20 gold piece in the in the vaults and so you could take your currency. By the way, uh in my first book, that's where I started this uh sort of one-man war, uh on educating people, uh the difference between currency versus money. Aristotle was the first person to define uh the key attributes that something had to have to be considered money. It's got to be a medium of exchange, a unit of account, but most of all, a store of value. And the very design of national fiat currencies that are borrowed into existence, the math says that they absolutely must lose value over long periods of time. Uh but what was the question again? >> No, it's a very complex question. I was like what what would happen if any any currency were to back it with gold like but I think there's different levels like Zimbabwe versus China versus the US. >> Well, it would be sort of a reverse Gresham's law. aggression's law says bad money chases good money out of circulation. And what would happen is people would want to be spending all of the bad money, the the uh currency of the countries that aren't backing with gold. So, they'd be going to the currency exchanges and trying to sell the unbacked currency to uh and and exchange it for a currency that is backed by gold and more trustworthy. It it requires though a um a really catastrophic event where there's a lot of fear and everybody is seeking safety and then you will get this reverse Gresian's law. >> Maybe short answer. Would US dollar investors buy Chinese UN if the yuan was all the sudden goldbacked? >> Well, it's entirely possible, isn't it? I mean uh uh yes, but the US dollar investor can also buy gold. That's that's the same thing as exchanging you're exchanging your currency for money. I I find it interesting that you can take these pieces of paper with numbers and pictures of dead guys on them uh and you can actually buy something real with it. You know, if you take a look at the uh all of these national fiat currencies, it's a piece of paper that's been ruined. You can't even use it to write a list on it because it's got all this ink on it already with just digits. And you know most uh [clears throat] only about one out of every 10 dollars that exist is created by the Federal Reserve. The other nine are created by the banks. All of them with the exception of the currency in circulation. The dollars that are in your wallet are just typed into existence. They don't even bother to print them. So when they say they're printing currency, no, they're typing currency. So you've got to ask yourself how many numbers are there? because that's the limit to what they can print. How many numbers are there? It it's it's infinite. And so, right. And so, u what is the the value of the dollar is the inverse of that. Uh and the if the dollar uh used to be worth 120th of an ounce of gold and now it's worth less than 1/4,000th of an ounce of gold. And so it's already lost more than 99% of its value since the Federal Reserve became the custodian of the dollar's value. >> Absolutely. Mike, what a wonderful conversation. We'll have to do this again soon. Maybe virtually we can expand on some topics. Stable coins. Really curious what your thoughts on that are, but uh we'll have to do that next time. >> One thing I do want to say before this ends though is Robert Kiyosaki always used to say that investing is a team sport. And before uh you you invest in stocks or anything other than physical gold and silver, you need to build a team. And you can do that by subscribing to a newsletter with people that know what they're doing. So >> appreciate that. Really appreciate that, Mike. Where can we send our audience to follow your work? >> Okay. Well, if you just uh do an internet search for Mike Maloney, you'll find my YouTube channel. Uh it's Gold and uh I've got uh a precious metals dealership called goldsilver.com. >> Fantastic. Awesome. Mike, thank you so much. It was a great pleasure having you on. Really appreciate it. Everybody else, thank you so much for tuning in. Much appreciate you watching here from the floor of the New Orleans Investment Conference. Make sure to stay tuned and hit that like and subscribe button. Helps us out tremendously. Thank you so much for tuning in. Take care.
WARNING: Historic Financial Reset Imminent, Gold To Rally | Mike Maloney
Summary
Transcript
Special coverage from the New Orleans Investment Conference is brought to you [music] by First Majestic Silver Corp. There's no substitute for silver. Hello and welcome back to Soore Financially here from New New Orleans Investment Conference. My name is Kai Hoffen. I'm the Edj Mining guy over on X and of course your host of this channel and I'm joined by none other than Mike Maloney. Mike, it is such a great pleasure to have you sitting here in this chair. You're the founder of golds.com. You're an accomplished author, best-selling author. Her latest book is The Great Gold and Silver Rush of the 21st Century. We'll get to the content of the book and how it applies to what we're doing and talking about today in a minute, but first just thanks for being here. >> Well, thank you. This is actually the first time I've been to this the New Orleans Investment Conference, and it's actually quite something. And you know, we've had such a runup in gold and silver uh recently. So, there's an excitement going on here uh that is great to see. uh all of the things that I wrote and you know my first book uh I was with Robert Kiasaki and the Rich Dad group and so it was written from 2002 uh through 2007 and it came out in in 2008. Uh and [clears throat] all of the things that I wrote about then and the things that I wrote about in my last book which came out in early 2000 in 2023 are starting to come true right now. And it's it's time to get prepared, that's for sure. >> Let's dissect that together a little bit. Let's start on the macro side. We'll make our way down to the micro, meaning the precious metal prices and price moves. But um maybe on on your assessment, 30,000 foot view, like what's the state of the economy? What's the state of the financial markets? >> Uh the state of the economy is I hate to say it, we're screwed. [laughter] That's that's what it you you look at what every president has done and they run on a platform. and they're going to reduce the budget deficit. They're going to balance things. And then as soon as they get into office, they go exactly the opposite direction. Uh because the population likes it when you're handing out free candy. And uh that's basically uh what they're doing is they're keeping the population appeased at the expense of uh the I hate to say it but you know we're we're I I do think that we are headed into a huge global financial crisis. Uh in 1929 the stock markets were in a bubble. uh in 1966 stocks uh were in a bubble and they worked their way off. The Dow bumped its head on a,000 points in 1966 and couldn't break out until 1982. So stocks went sideways during a period of raging inflation. And so corporate profits and stuff went up during that period of time. And so all of the PE ratios and the indicators that tell you whether stocks are in a bubble or not worked themselves off. So we we had a correction without a crash. But the first time it was stocks moving, gold was fixed. Uh the the and real estate was not in a bubble. The second time it was stocks, real estate was not in a bubble in 1966 to 82. And then we had the uh NASDAQ the the tech bubble of 1999 2000. Again, stocks in a bubble but not real estate. Uh and and uh then it was both you know from 1971 um uh to 19 when gold became free trading. It was only gold moving that caused this correction in the uh the uh gold to uh the the like the Dow gold ratio the stock market to gold. It was only gold moving. This time it's both gold uh and the markets are moving. Uh we've got uh you know in in 2008 the global financial crisis stocks had already been beaten down from the 1999 2000 tech bubble popping and so uh stocks were just above the stock market uh was above fair value. it it never was allowed. Ben Bernani papered over all the cracks and it was never allowed to go to undervalued so that we built a solid base again. What they did was they just as as everybody knows created tons of currency. Uh they exceeded my wildest nightmares when because I had written all about this and about his response to the next crisis in my book that came out just months before that before it all happened. Uh but um uh this time stocks are in a bubble, bonds are in a bubble and real estate is in a bubble and these are bubbles of historic proportions. Uh the the only way that you can measure the stock market that shows it uh not in the greatest bubble in history is PE ratios. All of the other measures, the Buffett indicator and and uh the different ways of measuring it, uh all show it in the greatest bubble in history. Real estate, same thing. And then uh bonds, uh you know, we've we had a a bull market in bonds from 1980 until uh just the past couple of years. So bonds are also >> 40ear bond bull market in bonds, right? >> Exactly. Exactly. And so uh when these you can't [clears throat] have something go into a bubble where it's out of whack with the rest of the economy permanent. It can't stay there permanently. Something has to happen. Either the economy has to grow to match it and that's not very likely or there has to be a crash, a correction. And so, um, uh, we're going into this next big crisis with 38 trillion dollar worth of debt and with, uh, the, uh, Fed's balance sheet already expanded so much. Uh, in a 2015 update to my first book, I I wrote that, uh, you know, there the next time that they do QE, they're starting it from a base that is already so high. there was $800 billion in uh in the uh bank reserves and uh in base currency. Base currency is the cash in your wallet plus bank reserves. And uh it peaked at 9 trillion. And so uh uh we're just we're off the rails. >> Oh, we we definitely are. We definitely are. But then again, like how how much longer can it continue kicking the can down the road? Um because we we were sitting here fortunately gold is caught up now otherwise we'd be still people would call us liars. Right. >> Right. Like >> yeah gold is make it's it's the alarm bells going off right now. >> I was going to say like what kind of signals do you take away from that? What is gold and silver signaling and gold in particular probably signaling to you right now? >> Uh central banks are still buying it. It it definitely has not peaked. uh in this uh last runup it was basically uh Asia and uh a little and India uh pushing the gold price and it was physical demand instead of all the gambling on the commodities exchange and the LBMA. Uh and so uh it's it's telling me that we're getting closer and closer to a crisis and it it has it's impossible for bubbles to to uh just go on forever. So, we're at a period of time where, you know, they are trying to kick the can down the road, but with things at the extremes that they are at right now, uh, I I'm expecting something within the next year or so. I'm actually surprised that we got through October uh, with no big event. October is always that spooky month. >> Always something. A black swan loves October, >> right? Yeah. >> Right. Now, um, how much cushion do you think there is in the system? like you you mentioned the Fed balance sheet, you mentioned the $ 38 trillion in debt. Is there even any cushion left to absorb a massive shock that you're hinting at here? >> Uh I don't Well, the thing I wrote when I updated my uh first book in 2015 uh was that they're going to need to do the same percentage increase, not the amount of printing, the QE, but the percentage increase to try and stave off anything. But remember, like I said, in in uh 2008, the stock market wasn't in a bubble. That was a real estate problem only, and it affected the stock market. This time, it's real estate and stocks. And uh it's it's turning out that, you know, everybody was expecting commercial real estate uh to do a correction. Well, uh that has all been uh put off with forbearance and uh and uh rewriting the mortgage agreements and uh um and uh that is all over with now and they can't really kick that can down the road any further. Uh I'm really expecting something horrific actually. >> Well, we're seeing some cracks on the subprime mark in the supply market, the auto supply. We've been seeing that just the last few weeks sort of seep through here. $1.7 trillion supreme lending market on the auto side. Is that where you're looking for cracks? Is that maybe potential domino? >> Yeah, there's the the number of repossessions of cars has just exploded. And then the number of people uh searching you know internet search terms for help with mortgage uh basically uh you know um the search terms for do you remember during the 2008 global financial crisis there was jingle mail. You put the keys in the envelope you mail them back to the bank. The house is theirs. Uh so all of these search terms for things that these nobody should be searching for uh how to consolidate debt u manage their mortgage payments uh um how to uh give their car back to the bank uh if the economy is healthy. It's not healthy. the underlying economy has the stock market completely detached from the real economy a couple of years ago and it's everything is is like fake right now. It it definitely feels like that and uh now gold you you touched on gold is telling us something here but the runup in gold was quite significant like was gold outperforming maybe the expectations um when you look at price performance versus underlying let's let's say economy or markets um because the move was quite violent. >> Uh it was nothing compared to the final months of 1979 and the first month of 1980. It was absolutely it was an insignificant move. Uh actually um in my book the great gold and silver rush of the 21st century uh I uh quote several articles from time magazine back then and uh there are there was a um an economist uh I can't from the 1800s uh his last name was Gifin I can't remember his first name right now but he proposed that there's a certain class of goods gifan goods they're called that um where price demand uh uh balances don't work. It's exactly the opposite. So, as the price goes up of something, usually anything, there's less demand because people can't they look for a less expensive alternative. Gold and silver violate that. We just saw that with with this runup. Uh this runup was largely caused by physical demand in Asia, uh Australia. It was interesting in the United States. Uh we weren't participating yet. In fact, there was a lot more sales than buys and refiners in the United States got all clogged up. Uh >> I've been hearing month of August a lot more selling than buying because gold shot up. This is what I'm hearing from the bullion dealers. >> Yeah. They think they're taking and they're the people that are selling are going to regret it one day. They really will. Uh it is sad to see the east buying and the west selling because it's a wealth transfer that is going on. And uh you are going to we are nowhere near the top of the precious metals markets. And the things that tell you that are things like the Dow gold ratio, the gold silver ratio. In 1980, uh when gold and silver peaked on the same day, uh the ratio between gold and silver, it took 14 ounces of silver to equal the value of 1 ounce of gold. And that is about the natural the natural ratio is that there's about 19 times more silver in the earth's crust than there is gold. Uh silver tends to occur more up toward the surface and gold is deeper. And so when we would dig it up back then, the reason that the gold silver ratios averaged about 15 to1, you know, somewhere between 13 and 16 to1 all over the planet was simply because if you've got a certain number of coins in circulation, you got 13 of these silver coins for each one of these gold coins in circulation. It's the free market >> finding this equilibrium, the exchange rate. And uh um right now at 85 to1 I think is what it's at. And during co it's shot up to 120. It's never silver has never been that cheap compared to gold. And uh I do believe that you are absolutely going to see the gold silver ratio at 20 or less. So that means silver's value rises compared to gold. So it doesn't mean gold is coming down and you you think silver is catching up remaining it's >> well this is exactly what happened back in 1979 silver lagged for the the bull market of the '7s and then just suddenly uh when gold started becoming perceived as too expensive and today $400 doesn't sound too expensive but you got to remember in in n before 1980 the average income in 79 was like $9600 a year in the United States And so, um, uh, gold had gone from $35 in just in in less than eight years. $35 to $400. And, uh, so the average guy, if he's if he's in his 40s, 500 bucks may have been the majority of his savings. I don't know. But he goes into the bank, takes out $500, rushes to a coin shop, and says, "I want to buy gold, too." And they drop one coin in his hand. And at that point, he goes, "Oh, is that all I can get? how much is the silver? And it's when the public changes their preference from gold to silver that, you know, people blame the the $50 uh silver price in 1980 on the Hunt brothers. And it's absolutely not true. They added 50 to 75 cents at the most to that market. It was really the public changing their buying preference uh being silver being perceived as a better bargain. talking about buying preference and sentiment. Um the banks are changing their tune towards gold and silver right now. JP Morgan, Morgan Stanley, Morgan Stanley was the famous one saying, "Well, maybe you should consider 60 2020 as part of your portfolio construction." 20% being gold of that, right? So, are we seeing the same mindset shift that we're seeing? >> JP Morgan say prices as high as $10,000. >> Exactly. Jamie Diamond, right? Yeah. And so, uh, this is a major shift and it sort of signals that we're probably going into the third and final phase of the bull market, which is the greatest gains in the shortest period of time. Usually that bull markets have three phases. And uh, uh, this final phase, like I said, greatest gains in the shortest period of times. Well, what what are the gains that we've had so far? We've gone from 250 to 4,500 bucks an ounce. These are some huge gains already. Uh if you look at the um you know uh we created an interactive chart where we overlaid the bull market of the 70s uh with the bull market of today and then there's something called Elliot wave analysis and you take these waves the first wave uh wave uh I I can't remember whether it's AB and C or if it's one two and three but I >> think it's one to five up to five right is it I'm not an expert >> one two three or 1 2 3 4 five. Yeah, it's either three or five waves. >> Uh and um you when we match those the the very bottom and that top up, it was projecting that uh the this bull market would be 2.6 times greater in magnitude and 3.1 times longer than the uh '7s bull market. But it was projecting 9 $10,000 an ounce gold. And it's [clears throat] interesting to see these uh major banks and financial institutions, they were telling you to stay away from gold when it was 250 bucks. And now that it's $4,000, they're oh maybe you should put 20% of your part. Why? Because it's been the number one performing asset uh class of this century since the year 2000. The only thing that has outperformed precious metals is cryptos. But you know uh if you start at zero from zero to one is an infinite return. So um uh cryptos have done spectac I've been in them since 2014. I told my insiders about it recommended uh that they uh take a position in cryptos. But as cryptos go up I sell some and I take profits and turn it into silver. So um yeah I I think that we have some spectacular times ahead of us now. Can you imagine if Morgan Stanley is this 6040 portfolio with 60% equities and 40% bonds and they're saying sell half of your bonds and convert that into gold? >> That's now if that happens you're talking prices way north of $10,000 an ounce. >> Just the amount of trillions of dollars. What what's the global bond market or the even the retail bond holdings? >> It's huge. Um my research assistant Alan Hibbert uh who is a co-host on my YouTube channel uh he's done the calculations. >> I just think for some reason the $9 trillion pops in my head but I might be wrong on that. So don't quote me on it please >> but that's the number that pops into my head. So um >> so that much currency rushing into gold is uh something we're just at this uh point in history where everybody is looking for trust >> and gold is the that you know you hear it all the time. It's the only thing with the only asset with no counterparty risk. >> Yeah. >> No, it's true. It's absolutely true. And the central banks are buying like geopolitically. We're being told to buy it anyway and then the dollar is doomed as we're being told. >> Yeah. uh that's going to take a little while. But what's interesting about uh these types of processes is they're they go along very slowly until the day they don't and then suddenly everything becomes very fast. >> Yeah. Little by little by little and then all at once. >> Exactly. >> And Shakman likes likes to use that and was it Hemingway who originally said it. So no, it's it's it's >> how did you go bankrupt or broke? Well, little by little and then all sudden >> all at once. Exactly. I think that's what we're seeing here as well. Um, >> in in terms of silver, like we're at 40% right now, a year to date. Gold is also at 40% year to date. So, silver is still trailing. Gold is what sort of I'm taking away from your commentary as well. You're going 15 1:15 ratio. 15 to1 ratio. >> Well, I own uh 300 ounces of silver for every ounce of gold that I owned because I've allowed the gold silver ratio. I don't let it dictate anything to me, but at the same time, I pay a a lot of attention to numbers and I try to keep emotion out of my investment decisions. And with the gold silver ratio at these absolutely absurd, I mean, if you look at it, for 2,500 years, it was about 15. >> Yeah. >> And suddenly, here we are in just the last century where we're visiting the levels of a 100. Uh so silver is just way way undervalued. And so um I believe that for every if if it's at 80 if you buy an uh [clears throat] if you buy a 100 ounces of silver uh you're going to be able to exchange that at at 20 for four times more gold than you paid for basically. So >> you were talking about like we are in a death spiral like we're we're doomed. any way to break out of it? >> Uh well, you know, if [clears throat] they they are the world's central banks seem to be positioning to uh remonetize gold. Uh uh Trump was when he first took office was let's audit Fort Knox. Let's make sure the gold is there. Uh there were all these signals that we could potentially end up on some sort of gold standard. Again, the problem is with the levels of debt we have, I believe it's like $140,000 an ounce >> to uh pay off the national debt and uh revaluing it to current market levels isn't going to make even a dent in the uh the the current national debt. And so uh it would have to be at at prices far higher than that. The problem with that is it will upset the world economy so much. There's going to be some sort of giant convulsion that we go through. But in my book, the great gold and silver rush of the 21st century, I sort of lay out the, you know, we had the classical gold standard uh from the late 1800s until the end of World War I. And then uh we went on something called the gold exchange standard between the wars. And then uh we went on the Breton Woods system from 1944 to 1971 and now we're on the global dollar standard. And these are vastly different monetary systems there. It's not the same at all. People just don't the the common man was unaffected by these changes because they were little baby steps off of gold. So he went from something that was rock solid to a little less of that something to less to less to none. And so now it's just air. It's faith that the dollar is going to buy you something tomorrow because it bought you something today. And uh and I I believe that now we're going to take this huge step from nothing back to something and that is going to affect everybody on the planet. Every every person will feel it. >> I was just going to ask what happens if one country or one currency is all of a sudden part at least partially backed by gold for example. It doesn't matter who it is. um what would happen? What would be the signal? >> Well, I I do think that that would attract uh more uh trade in in that there is trust with uh that country's currency. So, you're talking >> can I expand on that question? Sorry. Can can I because there's trust >> at least superficial trust in the US dollar or even the yuan. >> Yeah. >> Let's assume Zimbabwe does the same thing and puts gold partially backs their currency with gold. Is that the same thing? You know, I'm just expanding on it. The original question, can any currency back it with gold and do because you touched on the trust issue like I'm I'm very complex the way I'm trying to approach this question. Is it different if the US starts backing its gold versus China versus Zimbabwe for example? >> You know, I'm on the record for saying that gold standards suck. >> Uh gold is great. A gold standard is some sort of representation of gold. uh you know the dollar used to be redeemable in gold. So if you're talking about red fully redeemable currencies uh the classical gold standard there was a 100% reserve the treasury for every $20 bill that was in circulation there was a $20 gold piece in the in the vaults and so you could take your currency. By the way, uh in my first book, that's where I started this uh sort of one-man war, uh on educating people, uh the difference between currency versus money. Aristotle was the first person to define uh the key attributes that something had to have to be considered money. It's got to be a medium of exchange, a unit of account, but most of all, a store of value. And the very design of national fiat currencies that are borrowed into existence, the math says that they absolutely must lose value over long periods of time. Uh but what was the question again? >> No, it's a very complex question. I was like what what would happen if any any currency were to back it with gold like but I think there's different levels like Zimbabwe versus China versus the US. >> Well, it would be sort of a reverse Gresham's law. aggression's law says bad money chases good money out of circulation. And what would happen is people would want to be spending all of the bad money, the the uh currency of the countries that aren't backing with gold. So, they'd be going to the currency exchanges and trying to sell the unbacked currency to uh and and exchange it for a currency that is backed by gold and more trustworthy. It it requires though a um a really catastrophic event where there's a lot of fear and everybody is seeking safety and then you will get this reverse Gresian's law. >> Maybe short answer. Would US dollar investors buy Chinese UN if the yuan was all the sudden goldbacked? >> Well, it's entirely possible, isn't it? I mean uh uh yes, but the US dollar investor can also buy gold. That's that's the same thing as exchanging you're exchanging your currency for money. I I find it interesting that you can take these pieces of paper with numbers and pictures of dead guys on them uh and you can actually buy something real with it. You know, if you take a look at the uh all of these national fiat currencies, it's a piece of paper that's been ruined. You can't even use it to write a list on it because it's got all this ink on it already with just digits. And you know most uh [clears throat] only about one out of every 10 dollars that exist is created by the Federal Reserve. The other nine are created by the banks. All of them with the exception of the currency in circulation. The dollars that are in your wallet are just typed into existence. They don't even bother to print them. So when they say they're printing currency, no, they're typing currency. So you've got to ask yourself how many numbers are there? because that's the limit to what they can print. How many numbers are there? It it's it's infinite. And so, right. And so, u what is the the value of the dollar is the inverse of that. Uh and the if the dollar uh used to be worth 120th of an ounce of gold and now it's worth less than 1/4,000th of an ounce of gold. And so it's already lost more than 99% of its value since the Federal Reserve became the custodian of the dollar's value. >> Absolutely. Mike, what a wonderful conversation. We'll have to do this again soon. Maybe virtually we can expand on some topics. Stable coins. Really curious what your thoughts on that are, but uh we'll have to do that next time. >> One thing I do want to say before this ends though is Robert Kiyosaki always used to say that investing is a team sport. And before uh you you invest in stocks or anything other than physical gold and silver, you need to build a team. And you can do that by subscribing to a newsletter with people that know what they're doing. So >> appreciate that. Really appreciate that, Mike. Where can we send our audience to follow your work? >> Okay. Well, if you just uh do an internet search for Mike Maloney, you'll find my YouTube channel. Uh it's Gold and uh I've got uh a precious metals dealership called goldsilver.com. >> Fantastic. Awesome. Mike, thank you so much. It was a great pleasure having you on. Really appreciate it. Everybody else, thank you so much for tuning in. Much appreciate you watching here from the floor of the New Orleans Investment Conference. Make sure to stay tuned and hit that like and subscribe button. Helps us out tremendously. Thank you so much for tuning in. Take care.