500% Increase in GOLD Prices! Gold Is About to Hit Massive “Bullish Momentum” Very Soon – Tavi Costa

500% Increase in GOLD Prices! Gold Is About to Hit Massive “Bullish Momentum” Very Soon – Tavi Costa

look at throughout history and what
you’re going to find is that central
banks back in the days used to hold
close to
75% of their Assets in gold and now
we’re you know we’ve been through a
30-year period where we’ve seen them
accumulating treasuries and other
sovereign debt in uh uh instruments
rather than the Met itself and now we’re
at the beginning of this trend reversing
and I think there’s a long ways to go
and as we see gold actually breaking out
and continuing to break out moving
forward and I think we’re going to see
stupid levels in terms of gold prices by
the end of this decade and so forth
amidst historical affinity for gold and
recent Market turbulence China’s
increased involvement signals a
significant shift in Gold trading
Dynamics Tavi Costa a macro strategist
from crescat Capital notes that Central
bank’s accumulation of gold reflects its
status as a credible monetary asset with
centuries of History this trend is
expected to persist potentially driving
gold prices to remarkable Levels by the
decade’s end this year’s surprising
surge gold prices puzzled analysts until
Chinese retail investors flooded the
Shanghai Futures exchange causing
volumes to triple and prices to soore
despite Global pressures like Rising
treasury yields and a strong dollar with
gold reaching all-time highs above
$2,400 an ounce China the world’s
largest producer and consumer of gold
plays a prominent role in this
extraordinary Ascent traditionally vying
with India for the world’s biggest buyer
of gold China surpassed India last year
as its jewelry bars and coins
consumption reached record levels Costa
suggests that while gold may lead the
price movement other Commodities could
see even more significant gains due to
their
undervaluation although gold equities
began to perform as expected in March
analysts predict that gold miners will
significantly outperform over the next
12 months this expectation is driven by
the anticipation of gold miners
finishing 2024 with appreciation well
above the movement of the underlying
gold price despite the bullish outlook
for gold and other Commodities Costa
sees min stocks as undervalued allowing
investors to capitalize on their
potential growth come along as we
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mostly Commodities hard assets can be
breaking down even even the housing
market participates as as a hard asset
but the most asymmetry you can find is
likely to be in the commodity space and
not even gold I mean gold is likely to
drive things higher and like to be the
sort of the the leading of the pack but
what really leads from a price
perspective is going to be the other
things that are so cheap such as silver
the minor plattin copper and other
things that are is still historically
cheap relative to Gold itself now what
is important here is that what I
mentioned in that whole report was
something a concept that I’ve been
thinking a lot about we know that we’re
living in a more de globalized
environment than we were back five years
ago but more from a logistics
perspective more from from a reshoring
perspective we’re seeing countries you
know having to improve their
manufacturing capabilities we’re seeing
defense spending we’re seeing conflicts
we haven’t seen in many years there is
also a de globalization era also being
Unleashed from a financial standpoint to
and that I mean through what central
banks hold in terms of their balance
sheets and Assets in terms of you know
the the need for owning a neutral asset
like we haven’t seen in many decades
such as gold and a neutral asset that
has centuries of History uh in terms of
being a credible monetary asset
different than Bitcoin in this case not
to say the Bitcoin will likely also
benefit from these Trends but gold is
the only one that carries that uh that
profile and so we’re seeing a large
purchases or accumulation of the metal
uh that doesn’t come as a surprise the
more important question is is this a
sticky movement are we going to see even
more of that accumulation moving forward
or this is all we’ve seen so far is is
actually what we’re going to get and my
answer to that is look at throughout
history and what you’re going to find is
that central banks back in the days used
to hold close to
75% of their Assets in gold and now
we’re you know we’ve been through a
30-year period where we’ve seen them
accumulating treasuries and other
sovereign debt in uh instruments rather
than the metal itself and now we’re at
the beginning of this trend reversing
and I think there’s a long ways to go
and as we see gold actually breaking out
and contining to break out moving
forward and I think we’re going to see
stupid levels in terms of gold prices by
the end of this decade and so forth uh
where you yet to see that actually drive
other assets that are uh usually have
leverage to gold prices and that’s why I
get so um you know I I get so uh I think
there’s such an opportunity to invest in
the mining industry because uh it’s been
forgotten and I find it hard to believe
we’re going to see all these things
unleashing without making that industry
at least more relevant of what it is
currently despite the movement we’re
seeing in gold prices mostly driven by
central banks and why we’re seeing this
movement I sort of explained already but
how do we know it central banks so we
know that because we’re not seeing the
inflows causing other vehicles like the
GLD which is an ET ETF most liquid ETF
in the US uh that retail investors tend
to buy we know 6040 portfolios are named
604s for a reason where investors
continue to completely neglect gold and
buy treasuries and you look at even the
TLT ETF as a as a good proxy for fixed
income which continues to see more and
more inflows despite the prices of the
asset being completely uh vanished in
the last two to three years now what is
important here in this sense is that
central banks don’t usually buy the
miners and so you’re seeing this lagging
effect where gold prices have been
rising and the miners are still lagging
here and that to me is the the the real
opportunity Costa underscores suppressed
credit spreads and the looming risk of a
recession citing IND indicators like the
steepening yield curve as worrisome
signals research from the Federal
Reserve Bank of New York indicates a 58%
probability of a US recession before
February 2025 a level not seen since the
1980s discussing the recent series of
rate hikes by the Federal Reserve
despite ongoing increases in the
monetary base Costa notes that the
central bank’s hire for longer stance
was unexpected at the beginning of
2024 however investors must adjust to
this reality with inflation proving
stickier than anticipated hovering
around 3% compared to the federal
reserve’s 2% Target recent statements
from Fed chair Jerome Powell and other
policy makers solidify the notion that
rate cuts are unlikely in the coming
months in fact there has been discussion
about the potential for additional rate
hikes if inflation does not ease further
emphasizing the fed’s commitment to
tackling inflationary pressures let’s
get back to the interview you know I
think it strengthen Decay is really what
we’re seeing we’ve had a a series of of
great hikes recently by the FED uh
despite the fact that monetary Bas is
still increasing I think what’s been
sort of hiding the the bearish thesis
has been the amount of fiscal stimulus
we’ve had so far now what I think it
changes over the next uh uh 12 to 24
months or so is is the fact that number
one uh credit spreads are completely
suppressed right now so basically we’re
living in a world where people are
starting to uh at least agree that
interest rates are going to be high
higher for longer or at least these
levels of interest rates that we’re
seeing in the long end short end and so
forth but we’re not seeing that
repricing happening when turns to risk
um so either we’re going to go back to
this inflationary era which I don’t
believe at all uh or uh risk needs to be
or is perceived too low and it’s
completely mispriced so if you look at
things like credit spreads which is
basically measuring the difference
between risk-free rates and also
corporate bond yields and so forth you
can see that those spreads are very low
today one of the lowest levels since
1995 in one of the charts that I had
recently and that measurement alone is
it actually happens every time uh you
see the suppression of of of those of
those spreads during periods of f hiking
cycle uh now we’re kind of at the end of
that situation we went from you know
people expecting seven rate high Cuts
recently to now less than two uh for the
next 12 months or so and I think people
are underestimate ating the risk of a
recession and lastly I would point out
what’s happening with the yield curve
the yield curve is starting to steepen
significantly what we’re seeing uh now
uh and and that usually coincides with
the recession too so if anything I think
things have really straightened up the
the the case for a a hard lending and uh
having the sentiment shift so uh so uh
drastically uh speaking across most
Market participants I would say that
that’s more of a worry uh and not
something I would be uh you know really
supporting my bullish thesis on I was
referring to a hard lending that
ultimately drives multiples to be
compressed and ultimately then will then
uh cause the econom economic contraction
one thing the IMF is also talking about
that I think it’s uh potentially more
relevant has to do with the sort of
dilemma fiscal dilemma that the US is
facing and they’ve been calling it sort
of a dangerous path fiscally speaking in
the US where we’re seeing more and more
uh fiscal stimulus at a time when
unemployment rates are so low we’re
seeing the economy is growing uh
somewhat normal um and there’s no reason
to see this level of spending outside of
the political reasons of elections
coming and so forth and the implications
of this is is having on the inflation
front I mean we’re basically feeding an
structural inflationary problem for
there’s many inflationary uh structural
pillars in my opinion but one of the
main ones is reckless fiscal spending
you know outside of The Chronic under
investments in uh natural resources what
you have in terms of De globalization
occurring um and even the labor markets
when people are starting to demand
higher wages and salaries all those are
inflationary Trends themselves but then
on top of it you add how much of the
Reckless fiscal spending we’re seeing in
the US it certainly adds to the case of
inflation I think the big opportunity or
the big uh high probability of of a
scenario here is actually more of a
stagflation where inflation is stays
sticky and even re accelerates in some
parts of the market and then on top of
it you also have a deceleration of
growth that ultimately drives um you
know the fed and also drives even a
contraction of the economy over time too
so I’m quite concerned about those
things and I think that there is a
chronic problem happening as well with
the treasury markets um you know what
we’re seeing in terms of the movement of
central banks uh and and the selling of
of of treasuries recently which it
hasn’t driven by central banks believe
it or not um but it’s that’s what really
concerns me is the fact that we’re yet
to see central banks to start selling
treasuries um it’s it’s a real problem
and more and more we’re seeing US Banks
I mean if you look at lending for
instance in the US economy lending has
gone sideways we’re not seeing
commercial and Industrial loans grow
because the banks are actually having to
buy what they’re having to buy
treasuries they’re lending money to the
government the recent days have seen a
stabilization in the gold market with
Thursday continuing this Trend despite
the stability the market remains
characterized by bullish sentiment
albeit with the expected
volatility what factors do you believe
will continue to drive the price
movement in the gold market share your
perspective in the comments below if the
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500% Increase in GOLD Prices! Gold Is About to Hit Massive “Bullish Momentum” Very Soon – Tavi Costa

Amidst historical affinity for gold and recent market turbulence, China’s increased involvement signals a significant shift in gold trading dynamics. Tavi Costa, a macro strategist from Crescat Capital, notes that central banks’ accumulation of gold reflects its status as a credible monetary asset with centuries of history. This trend is expected to persist, potentially driving gold prices to remarkable levels by the decade’s end.
This year’s surprising surge in gold prices puzzled analysts until Chinese retail investors flooded the Shanghai Futures Exchange, causing volumes to triple and prices to soar despite global pressures like rising Treasury yields and a strong dollar. With gold reaching all-time highs above $2,400 an ounce, China, the world’s largest producer and consumer of gold, plays a prominent role in this extraordinary ascent.
Traditionally vying with India for the world’s biggest buyer of gold, China surpassed India last year as its jewelry, bars, and coins consumption reached record levels. Costa suggests that while gold may lead the price movement, other commodities could see even more significant gains due to their undervaluation.
Although gold equities began to perform as expected in March, analysts predict that gold miners will significantly outperform over the next 12 months. This expectation is driven by the anticipation of gold miners finishing 2024 with appreciation well above the movement of the underlying gold price. Despite the bullish outlook for gold and other commodities, Costa sees mining stocks as undervalued, allowing investors to capitalize on their potential growth.
Costa underscores suppressed credit spreads and the looming risk of a recession, citing indicators like the steepening yield curve as worrisome signals. Research from the Federal Reserve Bank of New York indicates a 58% probability of a US recession before February 2025, a level not seen since the 1980s.
Discussing the recent series of rate hikes by the Federal Reserve despite ongoing increases in the monetary base, Costa notes that the central bank’s higher-for-longer stance was unexpected at the beginning of 2024. However, investors must adjust to this reality with inflation proving stickier than anticipated, hovering around 3% compared to the Federal Reserve’s 2% target.
Recent statements from Fed Chair Jerome Powell and other policymakers solidify the notion that rate cuts are unlikely in the coming months. In fact, there has been discussion about the potential for additional rate hikes if inflation does not ease further, emphasizing the Fed’s commitment to tackling inflationary pressures.

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