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Is Moscow Changing the Chessboard of Gold Pricing?

September 20, 2022

In Part II of this two-part interview with Michelle Makori of Kitco News, Matterhorn Asset Management principal Matthew Piepenburg addresses a range of ongoing shifts in a global financial system forever altered by Western sanctions against Putin. Chief among these changes is the Russian proposal to create an alternative to the LBMA gold exchange, one based in the East, namely the Moscow World Standard. Matthew discusses the motives behind this new exchange and its potential, longer-term impact on the fairer pricing of precious metals.

The various ripple effects emanating from the West’s financial war against Moscow are manifold, including Russia’s increasing interest in trade and currency arrangements among the BRICS and other emerging market economies. These agreements, along with energy trades outside of the petrodollar system, serve as further evidence of increased de-dollarization despite a temporary period of extreme (relative) dollar strength on the heels of an unsustainable Fed policy of rising rates. Matthew makes a strong and consistent case for an eventual Fed pivot from QT to QE by early 2023, but anticipates at least a 75 basis-point hike in the Fed Funds Rate this coming week.

Matthew further addresses the deflation/inflation question and ultimately foresees (and makes a case for) a period of stagflation ahead.

The interview concludes with a more detailed discussion of current USD strength and its undeniable yet temporary impact on the falling gold price. Specifically, Matthew lists various reasons why USD strength will weaken in the face of a recession, a contracting derivatives market and an Emerging Market debt burden stretched to its limits.

Part 1 of this interview is here.

Gold Switzerland

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Matt began his finance career as a transactional attorney before launching his first hedge fund during the NASDAQ bubble of 1999-2001

Thereafter, he began investing his own and other HNW family funds into alternative investment vehicles while operating as a General Counsel, CIO and later Managing Director of a single and multi-family office. Matthew worked closely as well with Morgan Stanley’s hedge fund platform in building a multi-strat/multi-manager fund to better manage risk in a market backdrop of extreme central bank intervention/support. The conviction that precious metals provides the most reliable and longer-term protection against potential systemic risk led Matt to join VON GREYERZ.

The author of the Amazon No#1 Release, Rigged to Fail, Matt is fluent in French, German and English; he is a graduate of Brown (BA), Harvard (MA) and the University of Michigan (JD). His widely respected reports on macro conditions and the changing behaviour of risk assets are published regularly at SignalsMatter.com.