Can Trump Expose Fed’s Gold Cover-Up? (Uncut) 02-28-2025

Can Trump Expose Fed’s Gold Cover-Up? Feat. Daniel Lacalle – LFTV Ep 212

The biggest headline for the economy is persistent inflation. Welcome to Life from the Vault. My name is Shane Moran and I’m thrilled to be your host for this week’s episode.

And from the entire Life from the Vault team around the globe, we extend heartfelt thanks to our unwavering community here at Life from the Vault. So thank you, thank you. As you can imagine, our community keeps expanding week by week, and we couldn’t be more excited about that.

So we’re in the midst of historic times, as you know, and today we’ve got the one and only Andrew Maguire in the Vault, precious metals expert and whistleblower. And he’ll be joined today by a returning guest and by popular demand from you, our Life from the Vault community, Mr. Daniel Lacaye. And that’s right, Daniel Lacaye is in the Vault with Andrew Maguire, and they’re here to talk gold and so much more.

So buckle up. This is going to be an incredible episode. You’re not going to want to miss a word here.

So anyway, Life from the Vault brings you exclusive insights, updates that you simply won’t find anywhere else. And this episode right here is no exception. Before we dive into talking gold with Andrew Maguire and his featured guest Daniel Lacaye, let’s take a moment here to spread the word about our channel.

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So all right, hit that like button right now. And without further ado, let me introduce our special guest today. Daniel Lacaye is an international speaker, a PhD in economy, and a fund manager also, financial analyst, and chief economist at TRESSIS.

He’s also a professor of global economics. And with that, let’s now head over to the UK and talking gold with Andrew Maguire and our featured guest, Mr. Daniel Lacaye. Over to you, Andrew.

Well, welcome, Daniel. Thank you so much for joining us again. And we’ve been really looking forward to this.

I’ve had so many people asking for you to come back, and especially there’s so much going on here at the moment. I mean, this is unprecedented. I don’t know if you see it as the same way as me.

To me, and I know you’ve been around a long time and studying the markets a long time, but to me, what we’re seeing now is unprecedented in so many ways. Yeah. And so really, thank you.

Thank you for joining us. But maybe we just start with, because something that really caught my attention, maybe it’s a great place to start. I was, I mean, I guess the English way of putting it, I was gobsmacked when I saw JD Vance, the straight talk to European bureaucrats last week, and some of them were in tears.

It gave me some hope of change. And I’m hoping that we’re right. Has this kind of upset the applecart? Oh, absolutely.

Well, first of all, thank you so much for inviting me again. It’s always a pleasure, Andy. And absolutely, it’s been a tremendous shock to the system, because in the European Union, in the European circles, it’s very, very rare to listen to somebody talk about things in such a clear and in such a way that is also completely different from the narrative that we get from the elite.

So to hear the vice president of the United States call the European Union, the UK government, etc., on freedom of expression, on the narrative of disinformation and the use of the alleged risk of disinformation, etc., to impose restrictions on civil liberties, I think it was refreshing. I think that a lot of people that have felt abandoned in Europe in general, also in the UK, abandoned by centre-right parties that have completely embraced this anti-culture of limiting freedom of expression, well, obviously, a lot of people felt very, very reassured. And it can be a significant element of change, and at least certainly something that has resonated very, very much with a lot of people.

Oh, and I think it’s something that I was actually so affixed to watching this, and that Bloomberg panned out to the audience, some very upset people there. And it worries me, in the sense, it kind of worries me, because I never count out these guys. They have tricks up their sleeve, and they’ve got fingers everywhere.

Do you think that when the Doge Group cut a lot of the funding that funds a lot of the NGOs and a lot of these people, that they rely on all this stuff to keep their Davos regime going? Is that going to affect these guys? It’ll be very, very significant. Think about what happened in Argentina, for example. The moment that the government cut the funding to unions that were literally maintaining a lot of workers all over Argentina hostage, and they were all the time forcing people to take action that probably many of them did not adhere to, that changed from one day to the other.

And I think it’s changing, and I think it’s changing quite a bit, because there’s also something that the bureaucrat elite does not count with, which is that even if they use the external enemy excuse, which they are, even if they use the propaganda machine, what is happening all over Europe and what is happening in a lot of places is that the silent majority that felt really, really worried about professional personal risks, if they decided to post something online or say something that could create some kind of repercussion, those people in hundreds of thousands are changing their mentality. And a lot of people are reacting in a way that is very, very refreshing and certainly hopeful for me, which is to understand that a lot of what had been going on for particularly in the past 15 years was a policy of extortion and self-censorship. So trying to force people to not say anything and bow down and just keep quiet to anything, because there could be economic and professional implications.

And that is certainly changing, I think it’s pretty evident. Yeah, and I think we, again, in this country here, since the Labour government, and I see Vance really had a go at Ostama, but the Labour government here imposed draconian rules and laws and where you’ve even seen people, he even referred to some of the issues where we think, you know, when somebody gets caught saying a prayer quietly and gets arrested, or somebody just even posts something and the police are at the door and there are people in jail for literally being in the wrong place. And these kind of things really worried me.

But when, again, when he talked about these things and brought them to light, and as you say, the mainstream media, the narrative breaks that narrative. And I think this is the encouragement, I think, not just me and my wife and my family and people around me where I go to the pub. I mean, it’s like something you’d whereas you couldn’t say this without being looked at as if you’re a conspiracy crazy person.

But this to me was so encouraging, especially living in this country where ordinarily they wouldn’t come here. But if I do a post or if somebody does a post, you have five of them at the door. Yeah, absolutely.

Absolutely. I think it’s very, very important because one thing that I found out is that, as you know, I live between Madrid and the UK, and is that people react in a more, I would say, hopeful way when the examples that are provided to them are ringing bells close to home, if you know what I mean. If people hear, for example, that Nigel Farage has been debanked, demonetized, whatever you call it, people say, well, you know, I don’t know.

I don’t know what that means. Now, when you say there was this person that posted this online and got arrested, people are like, whoa, this feels very, very close to home. And we have to be exceedingly worried about the constant advance of measures that, under the umbrella and the disguise of security and normal behavior, end up being ways of basically making people hostage and making people fall into self-censorship.

So I think that it’s been, I think it was very, very important. I remember that there was an article in the French press saying, how could J.D. Vance say these things? It was intolerable. And it was the first time ever that anybody had directly criticized governments for doing these things.

But in the article, there was absolutely nothing saying what he was saying was incorrect or what he was saying was unfair. No, it was simply saying, how dare you criticize the authorities? So I think that all of that is very positive because one thing that I’ve found in the last, particularly in the last three, four months, is that a lot of followers and a lot of people that subscribe to my social media, et cetera, write to me saying the following things. I never knew that so many people thought the same way.

I thought it was only me. That is what self-censorship and that is what the culture of cancellation and vetoing does, is make people think that they are the problem and that what they think is something that is obviously unacceptable because nobody else seems to think about it. Which reminds me of what Churchill said, that in a field of cows, it’s the crickets that make the noise.

And if you pay too much attention to the crickets, then you don’t realize that you have cows and you may end up with no milk, no meat and no cows. And this is what people are starting to realize, that we have been paying all of the attention to the crickets, to those activists that were making a tremendous amount of noise and making everybody else think that logic and that dissent were things that were unacceptable, that we all had to sort of think the same thing. And obviously, that is starting to change.

So I’m quite hopeful. Yeah. And I think whether one, staying apolitical, whether one likes Trump or not, I mean, he’s come in as, and this time, I think the strategy, whether you agree with it or not, the strategy of where he learned from the last time that he would run up against the deep state, the blob or whatever you want to call it.

No one denies it’s there. They even admit that. And so he was, they were ready for him.

And this time he came out, out of the gate and bang, bang, bang, bang. And I think J.D. Vance, now, then we see Ukraine, we’re going to sort this problem out. No, Europe, you’ve had three years at the table.

Stop asking to come to the table. Whether you agree with it or not. Zelensky, where’s these billions gone? Can you account for these billions where they’ve vanished? And, you know, you suddenly got this bang, bang, bang, bang situation and perhaps even peace is achievable.

To me, I like this momentum that is really, they’ve got this global elite on their heels. Yes, they will come back with something, but they’re on their heels. And I think it’s happening too fast for them to strategize.

I think that is the key thing, is that it’s happening so fast and they’re doing it the right way. If you go out and say, there are hundreds of billions of dollars being wasted on government spending. I come back to my previous example.

People just don’t pay attention. They don’t understand. Now, when you read two million dollars spent on transgender surgery in Guatemala or something like that, people are like, what? You know, my money is going to that.

No, but what people start to understand is that there is a direct link between the excessive expenditure and the waste and fraud and corruption that we are reading about every day and the advancement of these ideologies that have crippled freedom of expression and normal behavior in societies. That people start to understand why that was happening when they read that the mainstream media in their country were receiving USAID enormous figures. Now they understand why the headlines, the narrative, and the messages coming from those mediums were so out of touch with what they actually saw in reality.

So I think it’s almost like understanding the link between the use of funds and the spread of a type of ideology that was fundamentally about canceling and vetoing more than half of the population, in most cases. In other cases, the vast majority of the population. It’s also, and especially with you being European facing as well, you have an insight.

A lot of people that we talk to really have no view of Europe. And in fact, I’m known to have enough of an understanding of Europe. But essentially, most people view Europe as coordinated because of the European Union, because of Ursula von der Leyen, because there are various spokespeople.

I think this has also uncovered how discoordinated they all are. And they can’t agree about anything when put to the test. And they seem to be put to the test.

And then we’re witnessing this sort of situation. I’ve never seen this before. Yes, that is another important factor, is that a lot of European Union citizens felt that the European Union was a stable, coordinated, and purposeful entity.

But in the particular case of the Ukraine war, now, what a lot of people suddenly realize is, wow, I didn’t realize we’ve spent more than three years doing nothing. So it’s amazing that the US administration tries to do something. And then the European Union leaders get incredibly angry, because nobody is taking them to be part of the solution.

And when they ask, what is the solution? They say, well, nothing, almost. So I think that the point is simply that the entire shield of a publicity that has given people the idea that there was a purpose, that there was a strategy, that was something behind it, that is falling very, very, very, very quickly. And I think that that is also important.

And it’s also healthy, because it’s incredibly unhealthy when you live in the European Union. And I’ve gone to numerous TV, radio debates, things like that. And there’s a trick.

If you want to end a discussion in the European Union, any discussion, even if the arguments are pretty clear, if you want to end the discussion, just say the following words, the European Union says so. People would immediately stop debating with you. Ah, okay, fair enough.

If the European Union says so, then they must be right. And that is something that I’ve lived a lot of times in Spain, in Italy, in Portugal, in France, in Germany as well. If the European Commission says so, it’s because it’s a fact.

Well, I think that now people are healthily criticizing what is not working, by the way, because the other thing is that if things were actually working, well, then we would probably have more of an open debate. But the evidence is that it’s not just not working, but that is counterproductive. And that kind of leads into, do you have any insights into the German elections, which this Sunday, I think by Monday, we will have some sort of indication.

To be honest, I’ve lost track. And I think what the aspect I was following was, they were saying, or the powers that be were saying, well, no matter what AFD, no matter how many votes they get, we’ll block them. And it was a bit like J.D. Vance talking about Romania.

I mean, you’re going back now to that kind of thinking. To me, it worries me. I don’t think that there’s going to be a direct blocking of the elections, because if anything, the rise of alternative for Germany is very unlikely to be enough for them to win the elections.

And we are already accustomed in Germany to grand coalitions. So basically, the SPD and the CDU get together. They need a couple more votes.

They get the greens. Pretty much the same. Nothing changes.

But I think that there’s something that interests me more about the German elections, which is, number one, is the rise not just of alternative for Germany, but the rise of other parties that may be above 5 percent. And them combined will actually make it impossible for a grand coalition of the CDU and the SPD to go out and full throttle on government spending, deficit spending, and massive French-style government intrusion in the economy. So I think that that is what’s most important in these elections, is how the balance of power is going to move.

And if it does the way that it looks in the polls, it may make it impossible for whomever wins in a coalition to go out and change the constitutional limits to government deficit spending. I think that that is a very important factor. In any case, even if alternative for Germany doesn’t get to a position in which they can be a part of the government, the CDU, the German conservatives, they cannot win without a much stronger message and policy about immigration, about energy, and about industry.

So the interesting thing about everything that is happening is, yes, maybe we are and we should be exceedingly worried about the fact that there’s this democracy shield created in the European Union that can suggest to the European Commission and the European Union that elections should be or not. That is a very big worry, of course it is. But what interests me is that there could be a landslide effect of voters that are not willing to accept a status quo type of grand coalition with the SPD.

Because, you know, it makes no sense. A lot of people in Germany don’t even know the name of the candidate of the CDU. They know that if the CDU wins, the SPD is going to be in power, and if the SPD wins, the CDU is going to be helping them.

So, you know, it’s basically this interchangeable position of the social democrats with the conservatives that literally the things that people care about, immigration, energy, industry, the labor market, and the position relative to financing and the private sector versus the public sector. In all of those, they’re completely interchangeable. Interesting.

And I think so this kind of like makes me think more in a general way about now we’re kind of almost halfway into the first quarter. It’s unbelievable. I can’t believe it.

But what’s your impression of the economy? What do you see, Daniel? Well, I think that the economy, obviously, the biggest headline for the economy is persistent inflation, is that we have heard over and over again for months, this idea of declining inflation and coming back to the 2% target. And we’re very, very far away from it. And it’s obvious that we’re very, very far away because inflation is not a fatality.

It’s a policy. And it’s because money supply growth is at 27-month highs because government spending continues to be out of control. And that’s obviously leading to persistent and higher inflation.

So no wonder you have stagnant German economy, stagnant French economy, stagnant European economy. Stagnant UK economy, yet stock markets through the roof. No? It’s basically discounting money destruction.

It’s basically discounting that the European Central Bank, the Bank of England, this morning, the Bank of England, this morning, we had the 3% inflation figure in the UK. And the Bank of England immediately went out to say, oh, don’t worry, we’re going to still continue to cut rates. That is in itself the biggest problem.

So persistent inflation, very, very, very weak growth, and very significant challenges in terms of the bond market. Because persistent inflation means that global sovereign bonds stop being a reserve asset. We will certainly talk about gold, but that’s one of the reasons why central banks are purchasing more gold and getting rid of sovereign bonds.

So a lot of things are changing very, very quickly. And this is interesting because governments that don’t want to reduce their fiscal imbalances, or that are increasing them, like the UK one, that are increasing their fiscal imbalances, don’t pay attention to the fact that demand for the bonds that they issue is weakening in the areas that they took for granted would always be there to purchase whatever was being issued. And I think another thing, we mentioned gold briefly there, is that really there came a point, and I think it was a very significant point, on the 1st of January 2023, gold became Basel III compliant, first year asset class.

In other words, if my client wants to buy FX gold for my client, I get a T plus one delivery. And that’s the way it is. It didn’t used to be that way.

And for years and years and years, for 50 plus years, since Nixon took gold off the peg. So essentially, they really, I noticed, this was the point where the Bank of International Settlements, facing Europe, facing the global south, decided enough was enough, holding all their leases, paid off their last 500 tons on the 3rd of November 2022. No coincidence, zero, as we opened the year.

And so gold became first year asset class. So then we hear, obviously, we look at the bigger picture, but I hear Swiss pension funds openly saying, well, we’re going to actually sell some US treasuries and buy gold. The UBS, I saw Mon Bluberg about, it was only about six weeks ago or so, and he just happened to be on there, the head trader of UBS, I think it’s 1.1 trillion under management.

Yes, we are selling US treasuries and buying gold. I mean, this has to, how is this affecting? And I suppose, really, we’re talking about the US here as well, they’re all interconnects. I mean, we’re looking at the balance, the government balance sheet, what we’re talking, I think zero heads.

This morning, I saw 5.7 trillion in assets with 45.5 trillion in liabilities. I mean, this all starts to smell. Oh, it does.

Well, it’s been smelling for a while. Now, I think that what’s interesting now, and what is different is what you have just summarized very, very well, which is that global central banks are having to really defend their balance sheet. And therefore, they’re, in 2022, many of these central banks had latent losses with their bond portfolio, and they said, well, it’s one off, this doesn’t matter.

2023, again. 2024, again. And now, in 2025, again.

So that is, this is not, let’s say, a short term market volatility, we don’t care. I remember somebody at the ECB saying, we don’t care about market volatility. Well, now it’s not market volatility.

Now, it’s a very clear trend of monetary destruction that is making other central banks look at your bonds, not as a reserve asset, but as a risky asset. And I think that that is what’s changing. And I think that that is incredibly important.

Now, how does Trump and the new policies and everything get add to all of that? Higher volatility in the bond market. Why? Because if now, the Trump administration is cutting expenditure incredibly fast. I mean, you just look at the Department of Government Efficiency figures, it’s already 100 billion.

And by the time that some people will watch this video, it’ll be 120, 130. So huge spending cuts that are, that if they continue at this pace, would mean about $1.2 trillion less of government spending, which means $1.2 trillion less of excess liquidity going to disguise the financial and fiscal imbalances of other economies globally. So less supply of US dollars coming from the deficit of the United States, plus lower rate cuts from the Federal Reserve.

That means the risk of similar to a sudden stop situation in emerging economies is very elevated. If you add to all of that, that the geopolitical risks and the sovereign bond reserve asset challenge that we just mentioned, those two things are making the Central Bank of India, the Central Bank of Japan, sorry, of China, the Central Bank of Russia and so many other countries decide to accumulate more gold and get rid of sovereign bonds. All of that, if you think about it, is generating the seeds of likely scare in emerging market bonds and certainly in local currency denominated bonds.

Yeah. And I think you very recently, I think as much as recently as yesterday or the day before, you said that you made the statement, government bonds are no longer a reserve asset. Absolutely.

Yeah. That’s a pretty big bold statement. I know, because it’s very, and I remember getting a tremendous amount of criticism for saying that, but obviously that was the headline.

But everybody that criticized the article, I said, read what’s following and tell me where am I wrong? Just tell me where am I wrong? Where do you see, where do you not see the evidence to start with, which is not something that is happening this week. It’s been ongoing for a few years. The Central Bank of China reducing their assets in US dollars, the Central Bank of India, which means reducing their sovereign bond portfolios.

A lot of people, when they say that China has $3 trillion of reserves, they think that they have coins or notes, no, bonds. Okay. So that is a trend that has been going for a while, but it’s accelerated in 2024, precisely because in 2022, inflation was considered to be a transitory thing by all of the mainstream economists.

In 2023, they said, well, there could be some, it may be higher for longer, but not enough. And then it started to, it just continued. So I think that if you think about it, if anybody that owned the trend of reducing exposure to sovereign bonds has been happening in the Norwegian pension fund, in the biggest pension funds in the world, Japan included.

It’s happening in central banks. It’s happening in investment institutions that historically have been exceedingly underweight gold or completely no holding of gold. And now they’re buying gold and reducing their exposure to sovereign bonds.

So basically that is it. That is what it’s telling you. Absolutely.

I think this kind of leads and interestingly into, whereas two or three weeks ago, this was a conspiracy theory. And then the financial times talked about it and then it went on and on and out. Now it’s become open, it’s open gate.

In fact, we’ve seen the sense standing there in front of Trump in front of, in his office. And he’s talking about monetizing US treasury. Essentially he’s spinning the idea of monetizing US treasury gold.

And I so if one was, I mean, I really love your opinion on this. So if one was to vend gold into back a treasury, say you wanted to say a 30 or 50 year bond. And so to attract a good rate on that, and you would need without gold backing it, you’d need a massive rate on it.

But if you backed it with gold, you’d have, you probably only need a small rate on. Yeah. Is that feasible? Do you think? It’s difficult.

It’s challenging practically, but it is feasible. It is certainly feasible. What we need also to adjust is our expectations of credit growth.

You see, you cannot have the levels of seven, 8% per annum credit growth with that constraint. No, but it is practical. It’s feasible.

And it may change quite a few things that lead to boom and bust cycles, but certainly something that is, you know, that can be implemented. Yeah. And I think it’s interesting and also seen.

In fact, when you think you mentioned China a little while ago, and I think one of the big, I think when I look back to April of last year, which is when the Shanghai Futures Exchange opened up gold to a vast amount of people, gold trading. And then all the industry apologists came out and said, oh, it’s short term stuff. It’ll all, they’ll start selling it again.

Well, okay. So it went up 800 bucks, closed 600 bucks at the end of the year. Okay.

So, okay. So maybe, I think now this talk of actually potentially revaluing gold, potentially revaluing gold, and the risk is, well, if you were to do that, you’d need to audit U.S. treasury gold. You’d need to, it hasn’t been audited since 1974.

Now we have empirical evidence, Daniel, that, for example, when Germany asked for their 300 times back, I mean, why would it take initially seven years? I mean, we can fly stuff out. I could have flown that volume, whether it’s gold, silver out in a week. You could easily do that.

So why would it was initially going to take seven years? And why was the Bundesbank not allowed to even look in the vault? So, again, it’s just empirical evidence. I mean, nobody knows. It hasn’t been audited, but if it is disclosed that the Fed has mismanaged U.S. treasury gold by double, by loaning it out, double ownership, triple ownership, God knows what, then would that not give the Trump presidency an opportunity to really get into the Fed and have a look? Absolutely.

Absolutely. Because a lot of the things that we read about the Federal Reserve and the impossibility of the Trump administration to make drastic changes within the Fed come from the premise that the Fed has been pristine in its management. And if you read mainstream media, if you listen to the so-called experts, etc., nobody will even dare to question the management of a Federal Reserve.

Now, if you make an audit, and things start to come up that put all of that into question, then there is a constitutional right to get rid of the president of the Federal Reserve and some, and most, actually, of the members of the Federal Reserve. Why? Because, you know, the reason why I said this the other day, and people were actually in shock, the reason why everybody says, it says, the president cannot fire the president of the Federal Reserve. Well, you can if you actually have proof that they have completely abandoned their objectives, their mandate, which in the case of inflation, we all know they have.

But in the case of managing the reserves, it’s a completely different thing, because that is, that could actually lead to a federal prosecution, or at least a federal audit of what has happened, if there has been some kind of mismanagement. So, of course it can, of course it can. And that’s why I think it was a couple of days ago, or a few days ago, Elon Musk started tweeting about the, you know, about a video of the vaults of the Bank of England, and saying, why can’t we have the same video of the Federal Reserve, of Fort Knox? Why can’t we have it? We don’t have it.

It’s impossible. No? Okay. They say it’s for security.

Well, fair enough. But is there an audit? Then a lot of things. You see, what you said before, which is the incredibly fast pace at which the Trump administration is making changes in things that were allegedly impossible to even look at.

All of that is one of the key elements of this administration, and why this time it can certainly make a monumental change for the better. And we have, as I say, other than empirical evidence that there is an issue, and we really strongly suspect that it will uncover some form of mismanagement. Let’s just put it nicely.

I mean, you could put it actually in a more dastardly way. But essentially, I remember years ago, they flew over Bob Pisani from New York, obviously the presenter from CNBC, and he was taken with a hood into the HSBC vaults. And he held up a bar to say, you know, everything’s here, all this talk, conspiracy talk.

And he held up a bar to the camera. Well, interestingly, my friend, Ned Naylor-Leland, said, hang on, that bar belongs to an exchange fund that’s nothing to do with HSBC. And yet you’re holding this up to say, and talk about, I mean, are they that? I mean, to me, it just showed.

In other words, our mess doesn’t stink. You know what? We don’t care what you think. Oh, here.

Oh, we got caught. No one will talk about it. But I think now this starts to raise the issue, well, hang on, up to 12-week delays.

I mean, one client now had been told 12 weeks to get size. And then the LBMA put out what I think is an extremely disingenuous video, which says, oh, the only reason that there is 8 to 12-week delays is because we’re taking 400-ounce bars, and we’re smelting them into 100-ounce qualifying Comex bars. Hang on.

No, no. If the bullion is there, what you take, you take a truck, you put it in the truck, and then you put it on a plane, you send it. Why do you have to? It’s ridiculous.

It’s ludicrous. So I just thought that that in itself was silly, because you have the ability. The GC4 contract that was instigated back in COVID times was allowed you to take a 400-ounce bar, didn’t have to move from the vault, but you could credit the electronic warrant, and you could close the EFB spread.

Yeah. No, what I think is also very important is that I think that the deep state, the administration, however we want to call it, was very, very comfortable in an analogic world. And the arrival of Elon Musk and the bunch of geniuses that work with him is showing how quick you can find these surprising elements and how quickly you can actually get to the bottom of things with the right technology.

It’s interesting because the Federal Reserve is an incredibly analogic and very, very outdated central bank. A lot of things are filed in these corridors of cabinets that people literally go to pick a file, come back like in an old movie. So these things are incredibly important.

And I think that we will see some very, very surprising things in the next not even, I would say, not even months, probably weeks. The other thing I saw, and this was on the Bloomberg Terminal, I didn’t see it anywhere else, but it was on the Bloomberg Terminal. There was a story or they reported that the Bank of America had sent out an advisory to its clients targeting $3,500.

But a key takeaway from that was that they were saying, and this actually followed, it’s funny, this followed about a week after the China’s National Regulatory Administration opened up their insurance companies to buying gold. And with a potential close to a trillion dollars of potential, investment potential, but they figured that’s got to be 300 times. Actually, this is their rationale.

They figured that’s got to be 300 tons of bullion required. And that would, in their say, that would increase, that would be about 6.5% of the annual global market. Well, this is, but there’s so few funds invested in gold who are now saying, I cannot ignore this anymore.

I cannot ignore it at all. So even if you get a tiny percentage of these allocating a little bit, that would be another 3.5%. I mean, you’d be 10% and they’re 10%. That should be a value of 35 to 5,000 gold.

I mean, this is not silly numbers. This is potentially where the price of gold will be when you get a true supply demand, where in other words, where is somebody willing to put their physical gold on offer on the market? Do I do it at this price? Well, if I see potential for higher, now obviously, if I’m a producer, et cetera, et cetera, no problem. But if I’m an investor and I think, why would I be dumping my gold at this price? What you’re saying makes absolute sense.

And it’s the way for people to understand how the supply demand balance is a key factor to understand the rate of change in the price of gold. But to me, there’s another element that is incredibly important, which is, I don’t care how much debt has been issued, that is already behind us. What I care is about the not uncommitted, sorry, the committed but unfinanced liabilities of governments.

So gold today is discounting a level of money supply growth and a level of destruction of the purchasing power of currencies that is looking way back to a period in which inflation was below 2% per annum. But now, if we move to a world of three or three plus percent, it’s a completely different narrative. And you need to think about the comparison with the currency, because those are great, great elements to take into account, the fundamentals of supply and demand.

But there is a larger fundamental on top of that, that we must take into account is that we are going to be exchanging or valuing that gold in US dollars. And the US treasury has 100% of GDP of committed, unfinanced liabilities. So it’s not the 120% debt that it already has, it’s the 100% on top that is coming if the government doesn’t spend a single dollar from today until 2030, which is not going to happen, obviously.

So I think that that is a very important factor. On the one hand, you need to invest in gold because the fundamentals of supply and demand have shifted and the level of supply does not even get close to the demand that is coming both from the industrial part and the jewelry part, but also central banks, key element. And at the same time, those central banks are going to continue to increase their balance sheet via monetization of government imbalances.

So if you think of gold as the asset in the central bank that is most underweight out of all of the assets that they own, that needs to go up, and at the same time, you see that the other side of the balance sheet, the liabilities, they’re going up because they’re increasing money supply, then that asset has no other option in the mid to long term, but rise much faster than it has risen in the past years. And if you think about it, if you look at the S&P 500 versus gold, the S&P 500 versus gold in the last five years, pretty much similar performance. What are both of them discounting? Money supply growth and monetary destruction.

But they’re not, none of the two, and certainly gold least of them all, because it’s a less, let’s say for decades, it’s been a maligned or ignored asset by the Keynesian principle of 40-60, 40% bonds, 60% equities or whatever. If you look at that, and you start to realign, think about this as a short squeeze. Think about this as the world is underweight, the most valuable asset and the only one that defends you in a correction.

So it needs to shift that position from massively underweight to equal weight at the same time as demand and supply are tightening and central banks need more of that gold in order to balance their book. So to me, it’s a no-brainer. I don’t see how some people out there cannot see that situation.

Do you know what? Nobody could put it more succinctly than you just have. That is absolutely a really good way of looking at it. And I think when I say to my clients and people that I talk to, and I may be in the pub even, and somebody says, oh yeah, but gold’s gone up to here.

I don’t have the thing. I’ll wait. Hang on.

No, this is not about making money, my friend. This is about wealth protection. Because in other words, and then I would touch the table in the pub and say, next year, this will cost you more to buy.

Exactly. More pounds, more dollars, more everything to buy this table. So I mean, it’s a no-brainer.

It’s an absolute no-brainer when you’ve got a fungible first-year asset class. There is no other alternative. And you can benchmark that.

Of course, it’s just going to cost you more pounds next year. So why would you not protect your wealth? This is all because this is why programs like this and financial education is so important. People are starting all over the world.

People are really, really starting to understand the connection between inflation, money supply, government spending. But they still cling on to the fact that inflation is caused by things that have absolutely nothing to do with those factors. This morning, I read somewhere that UK inflation rises because of the VAT on school fees.

What the hell are you talking about? That doesn’t cause inflation. That doesn’t make inflation rise. Furthermore, if the amount of money was the same and the VAT on school fees went up, it would be deflationary because you would have less units of currency to purchase the rest of goods and services.

So people need to understand that in order to understand gold. People don’t get that gold. People don’t understand that gold is money.

Many people think that gold is a speculative asset. And we have heard once, many, many, many times from great investors, nothing against them, that it has no intrinsic value. Until people understand that what doesn’t have any intrinsic value is fiat currency.

Fiat currency has no intrinsic value whatsoever. Therefore, once they start to put those elements together, people may start to understand that what they get very well, when I speak with people, they understand very well, you know, inflation is not coming down and it’s likely to continue to be persistent. And everybody’s like, yes, I understand that.

And then why don’t you make the connection to your pounds, your euros are going to be worth less. And therefore, in gold, it’s going to protect you against that destruction of purchasing power. Again, beautifully put.

And to be honest, one last question, because you’ve been generous with your time. Just where do you see silver fitting into an investment portfolio? I think that silver is silver. I always call the relationship between gold and silver, the relationship between oil and gas.

Don’t fall under the premise that oil, if oil prices go up, natural gas prices need to go up with them or the other way around. The case of gold and silver, the fundamentals on supply and demand are very, very similar. Very tight supply and rising demand.

But there are differences. There are differences. Silver is more affected by the industrial sector development.

It’s more of an industrial sector type of commodity. And therefore, it will have different elements of volatility compared with gold, which has more to do with central bank purchases and with jewelry demand. So the dynamics are different on the demand side.

But the supply demand balance is equally tight and probably getting tighter in the case of silver. Because in the case of gold, I hear all the time the demand for new mining. In the case of silver, I see a lot less of that.

So I think that in a portfolio, you need to have both. And the way that I see a portfolio is that you need to look at it the same way as you would look at a soccer team. You need to have defense and you need to have a goalkeeper.

And silver and gold are the goalkeeper and defense of a soccer team. That’s beautifully put. And I think that is valuable.

And I would like to ask people to actually play this twice, this whole episode. You’ve really come up with some interesting, some very important ways of looking at things. Because it’s, as you say, that’s the beauty of these kind of programs.

Because what we’re trying to do is it’s about education. It’s about putting that and what you do is you bring, we enable that net to come that little bit wider than we normally do. Because you’re encapsulating a much bigger picture and it all interconnects.

And I think it’s so helpful. And Danielle, thank you so much for joining us. And I really would ask perhaps when we finish this quarter, that we could circle back and look at some of the things we talked about and where you think we might be into the second quarter.

It’s just fantastic. It’ll be a pleasure. It’ll be a pleasure.

I thoroughly enjoyed it. Thank you very much as always for a tremendous conversation. Thank you, Andrew.

Thank you, Daniel. Brilliant. Thank you.

All right. Thank you, Andrew Maguire and Danielle Lacaye for another fascinating discussion. And to our entire Life from a Vault community, remember this, buy physical and understand the difference between what Andy calls the casino paper gold and silver markets and the actual physical gold and silver markets.

They’re not the same. Don’t be fooled. So there you have it.

That’s all we have for you today on another episode of Life from the Vault. And please keep help spreading the word about this channel by hitting that like button, share this information, share this video, subscribe if you haven’t already done so. And if you hit that bell, that black bell right there, we will notify you as each episode goes live.

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