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'Deep recession' and new gold price highs to strike, but when? Jeff Christian

Kitco News

(Kitco News) - Another "deep recession" will come, said Jeff Christian, managing director of CPM Group, and when it does, gold will reach new all-time highs.

"We're going to have more recessions. You can't predict when a recession is going to hit, or how big or how deep it's going to be, but you can predict, with 100% certainty, that there will be future recessions, it's just the nature of economics. When the next recession hits, what's going to cause it? Probably some problem in the debt market or something else….and when you have that something scaring people and throwing the world into a recession, they will buy gold," Christian told David Lin of Kitco News.

Christian said that it is likely the next recession will hit some time in 2023 to 2025, and a gold price rally would follow.

"Debt and deficit spending are the number one economic problems. The second thing is real GDP. We're in a strong recovery right now because we had a really terrible 2020, so you're seeing strong numbers being posted," he said. "The IMF has just increased its estimates for real GDP in 2021. That's a rebound and our expectation for 2021, 2022, you're going to see a rebound and a recovery, but you have ongoing deficit problems, you have excess manufacturing capacity, now you have excess retail capacity. You have excess commercial real estate, and you have excess labor."

However, the "deep recession" does not equate to a total collapse of the financial system, which has withstood the test of hundreds of years of catastrophe, Christian noted, and there certainly won't be a "currency reset."

The U.S. dollar is likely to remain the global defacto reserve currency for the foreseeable future, he added, even in light of the rise of China.

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