• Tony Hayes CFA

Gold Jumps as Money Reaches Main St Finally

Updated: Jun 25, 2020

  1. On June 18, 2020, the Fed reported a further increase in the monetary base from $5.15 trillion to a new record of $5.35 trillion.

  2. Meanwhile, excess bank reserves held at the Fed started to fall finally from $3.22 trillion to $3.13 trillion

  3. The combination of the two changes resulted in a $0.29 trillion increase in the AWMB from $1.95 trillion to 2.22 trillion.

Further confirmation of the movement of money into the real economy can be seen with the rapid increase in both US M1 and M2 since the end of February 2020.

Money is finally moving into the real economy and as it does the price of gold has been rising and should continue to do so as the rate of increase in the AWMB accelerates.

The gold price moved up $21.90 on Friday, June 19 and again on Sunday night June 19 to a new high for the year. This is above the April NY closing price of $1748.40 per ounce.

This should be the breakout that carries gold rapid;y to the first target of $2,000 per ounce projected in previous articles

All that is left is to reiterate the previous to buy Fosterville South Exploration FSX (TSX V) $2.83 Cdn. which announced drill results on Friday, June 19:

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