Original Title: Funding government debt is ‘doubly difficult’ – Goldmoney’s Alasdair Macleod

Publish Date: May 29, 2023

In an interview with Kitco Mining, Alistair McLeod, head of research at Gold Money, discusses the potential risks of a contraction of credit on banks’ balance sheets in the US and eurozone. He suggests this could result in a serious clash with rising interest rates that could impact the economy at large. McLeod also discusses the issue of dollarisation, saying that China and Russia are “standing back” and letting the West destabilise itself, rather than actively seeking to destabilise the Western financial system. He warns that if these countries start selling down the $7tn in foreign assets they own, there could be a massive run on the dollar that could be difficult to contain.

The speaker discusses various topics, including the potential for China to reunite with Taiwan through trade, the possibility of provocation by America against Iran, the importance of real production over service industries in Western economies, and the potential for consolidation in the gold mining and banking sectors. They argue that while Western economies may be facing recession, the rest of the world, particularly Asia, has growth potential and demand for base metals such as copper will rise. The speaker also highlights the importance of the savings rate in China and suggests that tying currencies to gold may be a solution to inflationary pressures.