In a recent video, financial analyst Mario Innecco, from his popular YouTube channel Maneco64, dives into the history of gold and silver price manipulation and explores why he believes silver is on the verge of a major breakout.
Echoes of the 1970s: Central Banks and the Vatican
"The central banks and the bullion banks of today...are also going to fail in keeping gold and silver suppressed," Innecco asserts in his video. He cites the 1970s as a prime example, when central banks and bullion banks allegedly collaborated to suppress the price of gold. Innecco points to a specific instance: a meeting between then-Federal Reserve Chairman Paul Volcker and the Vatican treasury. A letter from the Vatican's Administration of the Patrimony of the Apostolic See (APSA) to Volcker, thanking him for "selling their gold," is presented as evidence of this collaboration. While the letter doesn't explicitly mention suppression, Innecco speculates that the Vatican sold or leased its gold at Volcker's request to help keep prices down.
The impact of this alleged manipulation is debatable. Gold prices did initially fall after the meeting, but Innecco argues that this decline might have been cyclical anyway. However, he believes the intervention likely exacerbated the decline and discouraged investors. Gold prices did eventually rebound, reaching new highs by the late 1970s.
Why Innecco Sees Silver Poised for a Breakout
"Silver is ready to really break out," Innecco declares. He highlights technical indicators suggesting a significant rise in silver prices might be imminent. He emphasizes the importance of factors like the money supply (M1 and M2) as leading indicators of inflation, which will ultimately drive precious metals prices higher.
"The fat currencies are going to continue to be debased," Innecco predicts. He argues that central banks will keep printing money, leading to higher inflation and a surge in gold and silver prices. Inecco concludes by emphasizing the importance of "stacking" gold and silver, referring to the practice of accumulating these precious metals as a hedge against inflation.
Looking Ahead: M1, M2, and the Future of Precious Metals
"The only thing you need to keep a close eye on is M1 and M2," Innecco advises. These metrics directly reflect the money supply, and rising M1 and M2 foreshadow inflationary pressures that benefit gold and silver. By keeping a close eye on these indicators, investors can make informed decisions about precious metals in a potentially inflationary future.
Here are the key takeaways from the video:
- Central Banks and Bullion Banks Suppress Prices: Innecco points to the role of central banks and bullion banks in manipulating gold and silver prices. He provides the example of Paul Volcker, former Federal Reserve Chairman, who allegedly collaborated with the Vatican to sell gold in an attempt to drive prices down.
- Cycles vs Manipulation: The video acknowledges that gold prices might have fallen in the 1970s even without manipulation due to natural cycles. However, Innecco argues that suppression efforts likely exacerbated the decline and discouraged investors.
- Silver Poised for Breakout: Innecco highlights technical indicators suggesting a significant rise in silver prices might be imminent. He emphasizes the importance of factors like the money supply (M1 and M2) as leading indicators of inflation, which will ultimately drive precious metals prices higher.
- Focus on M1 and M2: The video stresses the importance of monitoring M1 and M2 as these metrics directly reflect the money supply and foreshadow inflationary pressures that benefit gold and silver.
- Central Banks to Continue Printing: Innecco predicts that central banks will keep printing money, leading to higher inflation and ultimately a surge in gold and silver prices.
About Mario Innecco
Mario Innecco has been running his YouTube channel Maneco64 since November 2015. With a background in financial markets and economics, he spent over twenty years working in the City of London specializing in the exchange-traded derivatives market. Innecco dealt for major financial institutions and corporate entities, advising clients on the government bond market, interest rates, financial markets in general, and the economy. An ardent student of the Austrian School of Economics, Innecco uses his videos and blog articles (maneco64.net) to inform the public about how the financial markets and our current fiat monetary system functions.
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