Bitcoin, Gold and Inflation

While Goldman Sachs is correct to warn its clients to avoid Bitcoin, its assessment of the U.S. economy, the U.S. Dollar and inflation is wrong. But once they finally figure out what should already be obvious, they will advise their clients to buy gold, just at much higher prices.

U.S. Dollar: The Reason Why Goldman Sachs Is Bullish

Maybe the real reason Goldman Sachs is so bullish on the dollar is that as a primary dealer of U.S. Treasuries, they have a lot of dollars to sell. If Goldman's clients realized the dollar's fate, they wouldn't buy any Treasuries. Whether default or inflation, loss is inevitable.

Inflation Is Bullish For Gold

Investors are selling gold and gold mining stocks because a rising Dow Jones means risk is on, so safe havens are reflexively sold. But the Dow Jones Industrials Average is only up because the Federal Reserve is creating inflation to prop it up. This is ultimately far more bullish for gold than it is for the Dow.