What will be the effects of inflation on gold?

inflation, hyperinflation, gold bust, gold boom, dollar crash, dollarQ: Does inflation have any effect on the price of gold?

A: The reason gold and silver keep going up is because the quantity of U.S. dollars in print is exploding and will continue to do so as central banks attempt to continue to stimulate the economy. Gold and silver are the ultimate hedge against print currency. The reason they’re becoming so popular is because the other options that used to look safe — like stocks, bonds, and treasuries — no longer make sense. Even cash is no longer safe, because it’s in such an inflated bubble.

One of the leading first-world governments is almost certain to return to some kind of gold standard, and the rest of the nations are going to have to follow suit. This will put massive pressure on the United States to reverse course with its spending and consider a partial gold backing even though the backing would put limitations on the ability of Congress to deficit spend as much as it wanted. The value of gold and silver will explode overnight when this event happens. I suspect gold will rise well past $8,000 an ounce by 2020.

This isn’t some economic doomsday scenario; it’s a natural change that’s easy to see coming. Currency gets printed faster and faster – dollars, euros, yen, etc. – but the amount of gold and silver on the planet stays exactly the same. The more currency in print, the more currency it takes to exchange for gold and silver. Over and over throughout history, gold has been revalued to account for all the excess currency in circulation. If that were to happen today, the value of gold would be between $8,000 and $25,000 an ounce.