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Category: Glint Special Report

Glint Special Report: Mario Innecco – “I’ve caught the Bank of England red handed, fudging the inflation data”

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Special Report Bank Of England

The financial markets and macroeconomics analyst reveals shocking evidence to Glint Founder and CEO, Jason Cozens that the UK’s central bank is manipulating data to make inflation look lower than it is.

Mario has been using the Bank of England’s inflation calculator for the last few years and has found it a useful tool to bring home the point that under a sound money system the currency maintains its value and there is virtually no inflation.

The Bank of England (BOE) inflation calculator goes as far back as 1209. “In my YouTube channel(3) I have focused on the period from 1821 to 1914, which is the period after the Restriction Period (1797 to 1821) which was when the Bank of England suspended the gold standard due to the Napoleonic wars”, Mario tells me.

And Mario knows the financial and monetary system. He’s spent over 30 years in the city dealing with everything from commodities and FX to equities, interest rates and government bonds. 60,000 have subscribed to his YouTube channel, that he runs under the name ‘maneco64’, to watch the informative 2,600 videos that he has posted and that have racked up over 18m views.

From 1821 to 1914, Britain went back on the gold standard and according to the BOE/IC inflation averaged -0.1% per annum and one only needed £0.95 in 1914 to buy the same basket of goods that cost £1 in 1821. “So for almost 100 years when Britannia ruled the waves the pound actually gained in purchasing power”.

“Up until June last year, which was the last time I referred to the BOE/IC I also checked the inflation rate from 1914 to 2020 and found that it averaged 4.6% per annum during that period and that one needed £118 in 2020 to purchase an equivalent basket of goods worth £1 in 1914!”

“I had also looked at the period from 1997 to 2020 as 1997 was when the Bank of England was granted independence by the Labour government and as a result given a 2% inflation target. In that 23-year period, the BOE/IC showed an average of 2.7% inflation per annum which clearly showed the Old Lady had missed its target”.

So when Mario did a recent report for his YouTube channel on the CPI he again referred to the BOE/IC and to his astonishment all the data that he had reported last year since 1914 had been dramatically changed to show much lower inflation.

“The 1914 to 2020 period now shows an average inflation per annum of 4.2% and one needing £78.53 in 2020 instead of £118 to purchase the equivalent of £1 worth of 1914 goods”.

The most shocking change for Mario was for the period (1997 to 2020) since the Bank of England was ‘granted independence’, (something we don’t think the bank really has as the Chancellor could at any time overrule the Governor of the Bank of England and the Bank’s Monetary Policy Committee).

“Instead of an average annual rate of 2.7% the BOE/IC now shows a much lower late of 1.9% which is actually under the 2% target!”

We leave it to you the reader to make up your mind about the Bank of England’s intention in appearing to revise history. Mario’s take is that along with the government they are likely to now try to make inflation look lower than it actually is.

Mario also thinks it’s probable that government or central bank officials might try and wriggle their way out of this and attempt a cover up when challenged. “Their excuse will be that they, with the number crunchers at the ONS, have found a “better” way to calculate inflation”.

Foot note:

Section 19 of the 1998 Act said:
19 Reserve powers.
(1)The Treasury, after consultation with the Governor of the Bank, may by order give the Bank directions with respect to monetary policy if they are satisfied that the directions are required in the public interest and by extreme economic circumstances.
(2)An order under this section may include such consequential modifications of the provisions of this Part relating to the Monetary Policy Committee as the Treasury think fit.

(3) https://www.youtube.com/c/maneco64

Glint Special Report: Now could be exactly the right time to buy gold, with Glint

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The asset management company and author of the ‘In Gold We Trust Report’, Incrementum recently published this compelling graph below, stating that gold is entering its ‘strongest seasonal phase’, with the suggestion that its recent lack-luster performance could now be close to a bottom before it begins to climb again. According to this graph, between the months of July and September could be the optimal time to buy gold.

Right now, the gold price is rallying against what so far this year has been a very strong dollar. Last week, we were looking at an eight month low of just over $1680/oz, but as I write this the precious metal is pushing over the $1727 mark and Wells Fargo is still supporting its prediction that it will end the year around $2050 an ounce and you can see from this next chart how some pundits are looking into the future.

Gold retreated around 6% in June and needs to surge around 17% to hit the Wells Fargo prediction, but with recession knocking on the door and gold being very reasonably priced right now against other commodities, it’s likely that investors and savers may find that right now is the perfect time to buy gold as a hedge against the coming months of uncertainty.

The US dollar has been unprecedentedly strong over the last year, but this is almost entirely due, not to any outperformance of the US economy, but rather to more weakness elsewhere in the world. Most world economies are now effectively in, or approaching, recession – as defined as two successive quarters in negative growth – a continuation of which could lead to a return to a 1930’s depression.

It’s likely that the crash in crypto, as well as the ongoing downslide for general equities will soon be joined by a slump in house prices, as mortgage rates increase along with higher interest charges, leaving disposable income falling in relative value against rising inflation.

So, in this crazy world that we live in right now, there are lots of reasons for considering gold as a potentially safer way to help protect your savings. Take the Gold Seasonality Chart above, historically, there are better months in which to purchase gold than others when it comes to a buying strategy. There are various reasons for this, notably events such as the wedding season in India; Diwali etc. which are annually repeatable patterns that have traditionally been used to help predict growth in the value of your gold.

According to Tradingview.com, statistically speaking, September has shown the most positive returns, with July coming a close second, followed by November, but that doesn’t mean that you shouldn’t buy gold outside of these months. Clearly we’re not offering you any financial advice but, buying gold when the price is low may be a good strategy to see its growth. It’s worth noting that this year we have seen an anomaly, March is usually one of the worst performing months for gold, but on the back of Russia’s invasion of Ukraine on 24th February, we saw it doing its job protecting your savings as we watched its price spike in excess of $2000.

So, there’s no hard science about when you should or shouldn’t buy gold, but when the world economy seems to be on its uppers and we have the aftermath of the Covid pandemic, worker shortages in the US as well as geopolitical distress in central Europe; all this combined with the seasonally optimal summer gold buying months of July into September and you might consider that right now, today, is a pretty good time to top up your Glint account with some solid, allocated gold, kept safe in a non-government Brink’s vault, insured by Brink’s with Lloyds of London.

Add to this the unprecedented liquidity that Glint has brought to gold, enabling you to buy, sell, save, send and even spend the precious metal using your Glint app and debit Mastercard® then it stands to reason that (if you haven’t already) popping over to the app store and downloading the free Glint app might be the best decision you made this year… Clearly there are no guarantees, but if you need evidence that putting your money into gold is better value than keeping it in fiat currency or gambling with stocks and shares, take a look at the charts above and below – all charts from the www.ingoldwetrust.report.

At Glint, we make every effort to demonstrate a balanced conversation between gold, crypto and fiat currencies when it comes to purchasing power and, while we strongly believe that gold is the fairest and most reliable currency on the planet, we need to point out that it isn’t 100% risk free. While we have seen a steady increase over time, the value of gold can fall, which means that its purchasing power can also decline.

Gold is security. Glint its key.

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