Will The 2020s Be Good Or Bad For The Gold Market?

Will the 2020s be better than the 2010s for the yellow metal? We invite you to read our today's article, which provides the macroeconomic outlook for the whole new decade and learn whether the fundamental factors will become in the 2020s less or more friendly toward gold.

People often ask about my economic forecasts for the current year, whether the recession will come or not, etc. I reply that I'm an economist, not a fortune-teller. As the future is inherently unpredictable, I don't like the traditional January game of economic forecasting for the year ahead and I avoid providing detailed price predictions. So, my Readers can be surprised by the title of this article - if I don't like forecasting one year ahead, why the heck I would be forecasting the whole decade?

That's a very good question. As the time horizon lengthens, the uncertainty increases, as more unseen developments can happen and spoil the prediction. However, in a way, it's easier to forecast long-term trends than the short-term details, as far as fundamental factors are concerned. Things are very different in the very short-term (daily-to-day price changes, when fundamentals barely matter, but immediate-term technicals do).

In the case of the big picture, when you outline fundamental trends, the precise timing does not matter. Besides, how often we get a new decade (I know, technically, the new decade starts in 2021, but we already live in the 2020s, don't we?), so let's have some fun and try to sketch the most important economic trends in this decade and their impact on the gold market!

  • We will be enjoying better living standards, living healthier and longer lives. Despite the gloomy press news and populists' complaints, the facts are irrefutable. In many dimensions, humanity has never been better off. See below my favorite chart which shows the share of global population living in extreme poverty - it decreased from almost 90 percent in 1850 to below 10 percent in 2015! We believe that this trend will continue, in particular, we expect a significant catching up not only by some Asian countries but also by Africa as a whole.
1 2
View single page >> |

If you enjoyed the above analysis and would you like to know more about the most important macroeconomic factors influencing the U.S. dollar value and the price of gold, we invite you to read the ...

more
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.