New BRICS Exchange, Schectman’s $150K Gold Prediction

Russia has just unveiled a plan to create a BRICS precious metals exchange for the BRICS member countries, allegedly to alter the current world gold, silver, and other precious metals’ pricing mechanisms. The announcement comes on the back of BRICS leaders declaring support for increased exchange of the metals between member countries this week. The BRICS' precious metals exchange may turn into a key regulator for the price of precious metals.

According to Reuters, Russia's Ministry of Finance officially said that the metals trading mechanism being set up under BRICS is the only one able to provide equal competition in compliance with the principles of exchanges. The leaders of the BRICS countries, which make up 37% of the global economy, met in Russia this week to discuss and plan alternatives to the ‘Western’ dominated financial system. Of course, Egypt, Ethiopia and South Africa are under Europe and Brazil is even further West, but ‘Western’ is being used to describe the U.S.-Eurozone financial powers.

According to Ernest Hoffman for Kitco News, speculation has also mounted that the BRICS summit could usher in a global financial reset. One seemingly sensationalist prediction is the revaluation of gold upward as high as $150,000 an ounce. BRICS members, along with most worldwide central banks, have been increasing their gold reserves at near-record levels in the last few years. Some central banks are even taking another step and repatriating the gold to store it within their own borders. A review of the recent gold movements shows countries like Germany, Austria, Slovakia, Argentina, the Netherlands, Saudi Arabia, Hungary, Belgium, Egypt, and others are among those repatriating their gold reserves.

Andy Schectman, President and Owner of Miles Franklin Precious Metals, explained to Kitco in a recent interview his reasoning behind such a massive potential repricing of gold. Stating that given that the U.S. gold holding (which has not been well audited for a long period of time) already totals more than 8,000 metric tons, by means of balancing assets and liabilities with the new price of gold, gold may be revalued to as high as $150,000 an ounce, greatly improving the balance sheet of the United States. He also warned that this reset would also have the effect of destabilising key aspects of the U.S. economy and could usher in simultaneous collapses in over-leveraged banks, under-capitalised insurance companies, the real estate market, the bond market, and the stock market. Enter a new CBDC issued versus gold.

This prediction may seem dramatic, but one thing that is certain is that countries have been repatriating gold aggressively and there needs to be a solution for the ever-growing national debts that countries are struggling with.