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Since the brexit sparked another round of gold buying, I was prompted to read and analyze correlation between the gold, inflation and public debt. As from the 2000s, the Gold prices have participated in a bull run. As a key reason, the "easy money" policies of majority of key world's central banks are to blame. So, why is the gold traditional hedge against inflation ? I have been hearing this line on the CNBC and Bloomberg for years and years, especially since we are currently in the phase of deflation.
So what are the conditions that represent inflation? That list include rising property prices, a rising stock market, and increasing asset values. But also the debt burden, representing debt with relation to income, is increasing.
Inflation v Debt
High inflation usually travels hand in hand with higher debt burdens. What does this mean ? Let me try to explain this. Imagine a situation where the government borrows $10 billion today from the market and that inflation is 5%, and the government bonds yields 10%. After a year, the government owes the same $10 bn that they borrowed. Add to that 10% interest and a total is $11 bn. Since the bond yield (10%) is above the inflation rate, th…
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Forex_champion avatar

Nice info

sonjatrader avatar

Great article

hrustiashka avatar

Good article!

scramble avatar
scramble 20 July

Simple, quick, and clear! I like this article! Nice job :)

samymahrous avatar

good written

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39/76
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1- Introduction.

En date du 29 Janvier 2016, la Banque du Japon a annoncé à la surprise générale qu'elle imposera un taux d'intérêt négatif de 0,1% sur les réserves des institutions financières déposées auprès d'elle. Cette décision a été adoptée à une courte majorité, cinq voix contre quatre. Cette mesure a pris effet le 16 février 2016. Les ambitions déclarées de la Banque du Japon est de tenter de relancer une économie atone mais nombre d'économistes doutent de l'impact d'une telle mesure sur l'économie réelle. Bien évidement, le marché des devises à réagir à la nouvelle, par une appréciation du yen !
A titre d'exemple, le taux de change USD/JPY est passé sous le support long terme situé vers 116. La bourse de Tokyo a réagi favorablement à la nouvelle avec une hausse de 2,8% pour se retourner les jours suivants et poursuivre son trend baissier entamé depuis août 2015.

Haruhiko Kuroda annonce sa nouvelle décision sur les taux directeurs de la Banque de Japon.
2- Les taux d'intérêts négatifs.

Le taux de rémunération des dépôts appelé également taux de la facilité des dépôts est le taux fixé par une Banque Centrale à tout dépôt que lui confie les institutions financières. C'est…
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zarina avatar
zarina 27 Feb.

Thank you for your article !

Nihad avatar
Nihad 27 Feb.

Good luck buddy

SolomiaM avatar
SolomiaM 11 Mar.

very interesting)

SofiaM avatar
SofiaM 11 Mar.

well done!)

Alesya_Isaeva avatar

good

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40/53
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Inflation Deflation and Quantitative easingWell, honestly I’m not so sure
picking this topic, but just lets go, it would be nice to discuss this topic
with others peoples.
I will start this topic by the definition
of inflation,
So, what is inflation?
Wikipedia says that inflation is a rise in the general level of prices of goods and services in an economy over a period of time.
This is means that during a period of time,
the price for goods and services go higher than before. For example if you buy
a cup cake about $ 1  in 2002 and than
ten years later that cup cake become $ 2 , that’s means during this ten year
there is inflation for about 100%. (in reality  inflation could be calculate in some formulas,
but the common one  is by using  Consumer Price Index, if you want to know how
to calculate inflation just find it in Google, so let’s get move)
 So, what
cause inflation? What drive price goes higher?
That is a huge question, inflation could be
triggered by so many factors, it could be the money supply, could be increasing
in  demand of goods and services, no
supply of goods and services and some others factor.
I will talk about the demand first, as we
know that if supply for a g…
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marius24 avatar
marius24 22 Mar.

i study a lot about inflation and very interesting your study

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