Gold Research Videos

In this video Juan Ramón Rallo, economist and university professor in Madrid, and Alasdair Macleod of the GoldMoney Foundation talk about the Spanish economy, gold and silver.

Rallo sees growing interest in the teachings of Austrian economics, because it’s the only school that provides a theory of the business cycle in relation to monetary phenomena. Keynsian economics on the other hand fails to see the heterogeneity of the economy when talking about aggregate demand. Furthermore printing money and issuing new debt won’t solve structural problems of misallocation of capital. Talking about real estate, Rallo points out that in the US the housing market has more or less bottomed, while in Spain prices still have further to fall. We have reached a point of debt saturation with people wanting to deleverage. Adhering to Keynesian thought, the government steps in to force more debt upon the people in order to stabilise the system.

Talking about silver’s monetary role, Rallo says that Silver used to be a monetary asset in the past and still has a role for lower payments, however, he doesn’t see as strong monetary demand for silver as there is for gold – making it riskier in the short term as shown by its higher volatility. However, if more people decide to put their savings into silver, the silver market would become more liquid and thus more stable.

This interview was recorded on November 15 2011 in Madrid.