Rafi Farber: 1970s Are Repeating for Gold, Too, Not Just Silver

Last week Rafi Farber detailed how the silver market is playing out the late 1970s almost exactly, and how we are currently situated in 1978. Well, it’s not just silver. With gold at new all-time highs and silver lagging, this was also the exact same situation of that year. History is repeating, and we should not be surprised, as human nature does not change.

Meanwhile, the Bank Term Funding Program is closing up next week, and one month later, about $80B in emergency loans from the Fed come due. The problem is, the Treasury’s banks turned in for all that cash, are even more underwater than they were back then. The Fed’s balance sheet will necessarily shrink by at least $80 one month from now, and this as the reverse repo facility comes close to zeroing out. Gird your loins, as they say. It’s going to be an interesting springtime for gold bugs and silver apes.

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