🚨 THIS is HUGE! Silver's GAME-CHANGING Shift & WHAT It Means for Gold!

Precious Metals, Economic Intervention & Monetary Policy: A Discussion with Steve Hanky

Key Concepts:

• Quantity Theory of Money: The theory that there is a direct relationship between the quantity of money in an economy and the level of prices of goods and services.
• Monetarism: An economic theory advocating for the control of money supply as the primary tool for stabilizing the economy.
• Reaganomics/Thatcheromics/Rogeromics: Economic policies promoting free markets, deregulation, and reduced government spending, implemented by Ronald Reagan, Margaret Thatcher, and Sir Roger Douglas respectively.
• M2: A broad measure of the money supply in an economy, including cash, checking deposits, and easily convertible near money.
• Consolidation (Market Term): A period following a rapid price increase where the price stabilizes or moves sideways, often indicating a temporary pause in the trend.
• Weak Hands/Strong Hands (Market Term): Investors who sell quickly during market downturns ("weak hands") versus those who hold their positions ("strong hands").

---

Silver Giveaway & Market Context (0:00 – 1:30)

The video begins with an announcement of a silver giveaway: 30 ounces of silver will be awarded to a winner selected from those who like the video, subscribe to the channel, and comment with their favorite type of silver or silver price predictions for February. This follows previous giveaways of 10 ounces in December and 20 ounces in January. The host then introduces guest Steve Hanky, a professor of applied economics at Johns Hopkins University and a distinguished senior scholar at the Mises Institute, who previously served on President Reagan’s Council of Economic Advisers. He is also the author of Capital, Interest and Waiting and Making Money Work.

Precious Metals Market Analysis (1:30 – 4:30)

Hanky discusses the recent surge in precious metal prices, noting that silver was around $40 and gold was significantly lower during his last appearance on the channel. He states that while he initially predicted a gold peak around $6,000, it has consolidated around $5,000, having previously reached higher levels. Silver has consolidated around $75-80 after reaching approximately $120. He emphasizes that these prices remain well above their 200-day moving averages, even after the recent pullbacks, indicating a shift to stronger hands holding the assets. He attributes the initial surge to technical factors and narratives surrounding the potential appointment of Jerome Powell as Federal Reserve Chairman, characterizing the causal link as coincidental and lacking fundamental basis. He notes Powell hasn’t even been confirmed yet. He stresses that no fundamental changes have occurred to justify the price movements. He admits to entering the silver market at $48, slightly late.

Concerns Regarding Economic Intervention (4:30 – 7:30)

Hanky expresses broader concerns about increasing government intervention in markets, a trend he observes in the United States and Canada. He contrasts this with the policies of Reagan, Thatcher, and Deng Xiaoping, who promoted free markets, privatization, and deregulation. He argues that current policies involve excessive state meddling, with decisions increasingly centralized in Ottawa, Washington D.C., Brussels, and Beijing. He highlights the growth of the lobbying industry as a symptom of this interventionism, where businesses seek exemptions from tariffs or other favors from the government. He states, “People have to I think get it in their head that the government is is basically in your bedroom almost.”

Proposed Economic Solutions (7:30 – 10:00)

When asked about a first step to rectify the situation, Hanky advocates for a return to principles outlined in the Reagan transition report: reinstating monetarism, deregulating industries, and promoting free trade by eliminating sanctions, tariffs, and other trade barriers. He believes this would foster higher potential economic growth, surpassing the potential offered by artificial intelligence (AI). He cites the examples of Reaganomics, Thatcheromics, Rogeromics in New Zealand, and the economic liberalization initiated by Deng Xiaoping in China as successful models. He expresses skepticism about the hype surrounding AI, predicting that many AI startups will fail.

Stock Market Bubble & Monetary Policy (10:00 – 12:30)

Hanky acknowledges the existence of a stock market bubble but suggests that it is unlikely to be corrected by a tightening of monetary policy in the United States, at least under the current administration. He reiterates the importance of the quantity theory of money and the need to maintain a consistent money supply growth rate (around 6% according to his “golden growth rate”) to achieve stable inflation and economic growth. He points to Paul Volcker’s success in curbing inflation in the 1970s as an example of effective monetary policy.

Portfolio Advice & Final Thoughts (12:30 – 14:30)

Hanky advises viewers to rebalance their portfolios, as equity weighting may have increased significantly due to recent bull runs. He recommends allocating 5-10% of portfolios to gold, and potentially silver, as a protective measure. He provides his X handle (@steve_hanky) and email address (hankyjhu.edu) for those interested in following his work or joining his distribution list.

Data & Statistics Mentioned:

• Silver Giveaway Amounts: 10 ounces (December), 20 ounces (January), 30 ounces (February).
• Silver Price: Around $40 (previous appearance), $75-80 (current consolidation).
• Gold Price: Reached higher levels previously, currently consolidating around $5,000 (predicted peak $6,000).
• China’s Total Factor Productivity Increase: 15-20% since 1980.
• Hanky’s “Golden Growth Rate”: 6% annual money supply growth (M2).
• Steve Hanky’s X Followers: 830,000.

Synthesis/Conclusion:

The discussion with Steve Hanky highlights the importance of sound monetary policy, free markets, and limited government intervention for long-term economic stability. While acknowledging the recent surge in precious metal prices, Hanky attributes it to technical factors rather than fundamental changes. He expresses concern about the growing trend of government interventionism and advocates for a return to the principles of Reaganomics and Thatcheromics. His advice to viewers emphasizes portfolio rebalancing and a modest allocation to gold and silver as a hedge against economic uncertainty.