Gold Switzerland, Released on 10/13/20

In this most recent MAMINAR, Egon von Greyerz exchanges pertinent thoughts on the economy and markets with Matterhorn Asset Management advisors, Ronni Stoeferle and Grant Williams. This timely discussion covers an extraordinary range of topics, beginning with the obvious disconnect between rising securities markets and the greatest economic downturn since the Great Depression.

Ronni and Egon address the exponential functions of rising global money supplies coupled with decades of extreme credit expansion as dual (and undeniable) tailwinds for risk assets. Since the Federal Reserve’s birth in 1913, it took 80 years to produce its first trillion dollars. In 2020, the Fed created a similar level of trillion-dollar liquidity in 5 months.

Grant reminds that central banks like the Fed are essentially new branches of government and that a powerful combination of central bank currency creation and extreme fiscal policies (i.e. deficit-spending) have been a clear liquidity boon for the favored stock markets. He warns, however, how the vast majority of election-focused politicians have conveniently confused the Fed-supported stock market with the collapsing economy, a tempting yet dangerous mistake. The media’s equal obsession with managing the “optics” of a rising stock market despite economic disaster signs all around us is of equal and telling concern.

The discussion turns as well to the critical topic of deflation and inflation, both as to price and money supply. Despite four decades of clear deflationary policies and conditions, the rise of MMT and increasing levels of government-guaranteed loans could serve as inflationary triggers.

Further, the increasing popularity of TIP’s, Ag land, precious metals and other inflation-sensitive assets suggests that investors are preparing for inflation.

History (and Egon) confirm that inflation is ultimately a matter of extreme money supply, and all agree that the backdrop for precious metals is highly favorable, not because gold is getting “stronger” but simply because every fiat currency in the world is getting blatantly weaker under unlimited QE and other central bank policy over-reaches.

The conversation turns as well to silver investing, mining stocks and the future of digital currencies as the global economy marches toward an inevitable debt and currency “re-set.”

Grant Williams is the portfolio manager of the Vulpes Precious Metals Fund and strategy advisor to Vulpes Investment Management in Singapore. Grant has 28 years of experience in finance on the Asian, Australian, European and US markets and has held senior positions at several international investment houses, including Robert Fleming, UBS and Credit Suisse. Since 2009, he has also been writing the popular investment newsletter Things That Make You Go Hmmm…

Egon von Greyerz is founder and Managing Partner of Matterhorn Asset Management AG & GoldSwitzerland. Since the 1990s Egon von Greyerz has been actively involved with financial investment activities including mergers and acquisitions and asset allocation consultancy for private family funds. This led to the creation of Matterhorn Asset Management, an asset management company based on wealth preservation principles. MAM is part of the Aquila Group, Switzerland’s largest independent asset management group. Von Greyerz makes regular media appearances on CNBC, BBC, etc. and publishes articles on the world economy and wealth preservation.

Ronald-Peter Stöferle is Managing Partner and Fund manager at Incrementum AG, based in the Principality of Liechtenstein. The company focusses on asset management and wealth management and is one hundred percent owned by its partners. Ronald manages a fund that invests based on the principles of the Austrian School of Economics.

  economy, gold, Grant Williams, markets, Ronald Peter Stöferle