What draws people to gold? You can’t eat it, live under it, or even buy things directly with it. Gold is an asset that is very expensive to mine, and once it has been dug up, people simply sit on it in hopes of maintaining or growing their wealth. So why is Gold's value rising and how high will it ultimately go?

It’s simpler than most think to answer both of these questions. Gold's value is increasing because the amount of printed fiat currency is also increasing.  Simply put, the increase of fiat currency devalues fiat currency. As long as the Federal Reserve (a.k.a. “The Fed”) and the central banks around the world keep printing fiat currency, the price of gold will continue to rise. Below are 6 graphs. They represent printed money supply, called “M2,” for the US, China, the Eurozone, Japan’s central bank, the UK and India:

By laying a chart of Gold over any of the above M2 charts, one gets a very clear indication how the printing of fiat currency effects the price of gold. With regard to money printing: Gold tells the truth.  Assuming the Fed keeps printing – and they have no other choice (but that's another discussion about interest rates and treasuries) – Gold will continue to rise.

But how high will it go? That’s the billion dollar question, right? Or should I say “Trillion Dollar” question?

Gold also tells the truth about USA debt. Watch this…

In 2008, the US was $9 trillion in debt. The price of gold was $850/OZ. Over less than two years, our debt level went from $9 Trillion to $15 Trillion. The increase in DEBT from $9T to $15T is a 67% increase. The increase in GOLD during the same time period, from $850/oz. to $1425/oz. is… drum roll please… 67%!  To say, “Gold tells the truth,” couldn't be more truthful.

So what do you do? You ask yourself two simple questions…

1. Do I believe the US government and central banks around the world will continue to increase money supply? In other words, will they keep printing money?

2. Will we accumulate more debt over the next few years, or will we begin to reduce the debt?

Considering our government’s inability to be fiscally responsible, it's impossible to assume debt will not keep growing. After all, Congress did just raise the debt ceiling, so they could keep adding to it.

Use your imagination and pretend the US government, Europe and the central banks of the world act like they are a public company. This company has 100 shares at $1 dollar per share. So the company, to pay down its debt and make the debt more manageable, prints shares without telling the shareholders. This is what the Fed is doing. Below is the proof from the St. Louis Federal Reserve.

The only way to keep the company afloat is to pay interest payments, so the company prints more shares. But the stock holders aren't made aware; they think their shares are still worth $1 dollar, yet the company has sold 100,000 more shares and used the money to pay down debts.

This is what the Federal Reserve is doing with the US currency. The international community uses US dollars to buy sugar, cotton, oil, GOLD and SILVER. Almost all commodities trade in US dollars. This is occurring now, so the stock market could go up to Dow 15,000 but in real dollars that’s closer to Dow 9000. The people don't know because their currency is falsely valued. The only way people know the money is being devalued is by the rising cost of their gas, oil, food, energy bills, etc.

Today, as I write this, the central banks around the world are revaluing global currencies to keep the scheme moving along. REVEALING THIS… is the price of gold and silver. They are the benchmark against which the revaluation is taking place.

Below is the actual supply of US Dollars from the St. Louis Fed, and I have included a graph of gold for the same time period. Look how closely the two graphs parallel each other. You can even see January’s gold price dip on the Fed chart as they, temporarily, slowed their money printing. Bottom line, gold is fiscal honesty.  And as long as the Fed keeps printing and the balance sheet keeps growing, gold and silver will continue to rise.

• Gold has outperformed and outlasted every paper currency ever printed.
• Gold remains the ultimate form of payment –No counter party risk.

• The US Dollar is losing status as a world reserve currency.
• Gold acts as safe haven in times of rising geopolitical tensions.