War Room host Steve Bannon interviewed Phillip Patrick, a precious metals specialist with Birch Gold Group, about the recent trends in central banks increasing their gold holdings and reducing reliance on the US dollar.
Bannon began by asking Patrick how gold prices have risen from around $1,100 to $3,800 in recent years and what factors are influencing this change. “I want to start with just a basic question people ask me all of the time,” Bannon said. “How did we get here in a situation where gold goes from I don’t know, $1,100 bucks, couple years ago when we started this partnership of trying to explain to people about gold as a hedge. How did it get to $3,800? And what are the top financiers in the world seeing that’s driving gold almost sometimes like a stock, which is not traditionally how it moves. Can you walk us through that?”
Patrick responded by noting that while significant movement in gold prices has occurred since 2008 and especially since 2020, the trend began at the turn of the century. He attributed this to an increase in the money supply during that period. “This isn’t a new thing. Obviously, what we have been seeing since 2008, since 2020 has been unprecedented in terms of gold’s movement, but it started really growing at the turn of the century,” Patrick said.
Patrick explained further: “What’s interesting is what changed at the turn of the century. It’s when we started to massively increase the money supply.” He emphasized a direct link between increases in debt and money supply with growth in gold investments: “There is a direct correlation between growth and debt, the money supply and growth in gold.”
He also pointed out actions taken by recent administrations as contributing factors. “Look what the Biden administration did. 8 trillion dollars of liquidity pumped through the markets in four years. It’s no surprise gold is moving at the level that it is,” Patrick continued.
According to Patrick, central banks have shifted their reserve assets away from traditional currencies such as the Euro and US Government debt toward gold. “Gold is now becoming slowly, the favored central bank reserve asset. I’ve mentioned before, it overtook the Euro last year. It’s now a larger share of global reserves than US Government debt,” he explained.
Bannon highlighted these developments for viewers’ financial awareness: “And now gold is really taking the place of certain fiat currencies. Folks, this is something you must understand because this is central to your financial security going forward.”
When asked if central banks were treating gold as an alternative reserve currency, Patrick confirmed: “It is clear to see, 73 percent of central banks that were surveyed said over the next five years, they were looking at massively increasing gold holdings and reducing US dollar holdings.”
