Boom Bust Season 3 Episode 120 Rickards On Gold in a Deflationary Zero-rate World

In season 3 episode 120 of Boom Bust, titled "Rickards On Gold in a Deflationary Zero-rate World," renowned financial expert and author James Rickards joins the show to discuss the potential role of gold in a deflationary environment where interest rates are at or near zero.

As the global economy grapples with the effects of the COVID-19 pandemic and central banks around the world implement aggressive monetary policies in an attempt to mitigate the damage, Rickards argues that a deflationary environment could be on the horizon. In such an environment, traditional methods of stimulating the economy (such as cutting interest rates) may be ineffective, leading to a prolonged period of economic stagnation.

Rickards believes that gold could play a crucial role in mitigating the effects of a deflationary environment. As a physical asset that is not tied to any particular currency or government, gold can serve as a store of value and a safe haven asset during times of economic uncertainty. Additionally, as interest rates approach zero, the opportunity cost of holding gold instead of traditional investments like bonds decreases.

The episode also touches on the recent surge in gold prices, which have hit all-time highs in recent months. Rickards acknowledges that gold prices can be volatile in the short-term, but argues that the long-term trend for gold remains bullish due to a combination of factors including geopolitical tensions, a weakening dollar, and ongoing uncertainty in the global economy.

Throughout the episode, Rickards provides his insights on a range of topics related to gold and the economy, from the impact of negative interest rates on the banking sector to the potential for a new global monetary system based on a basket of currencies. He also shares his thoughts on how individual investors can incorporate gold into their portfolios and why he believes that physical gold (as opposed to ETFs or other financial instruments) is the safest way to invest in the asset.

Overall, "Rickards On Gold in a Deflationary Zero-rate World" provides a thought-provoking discussion on the role of gold in today's global economy and the potential implications of a deflationary environment with zero interest rates.