| I have shown how the system was virtually fully capitalized in 1934 after the U.S. dollar was devalued. After many years of U.S. dollar debasement since 1934, there was a massive bank run that ended in 1980 only when the U.S. dollar banking system was again fully capitalized.
That end came about 46 years after the 1934 recapitalization, when gold hit $850 in 1980. The U.S. dollar banking system again technically had a 100% gold backing based on the gold price.
After both the 1934 and 1980 recapitalizations of the U.S. dollar banking system, the gold chart kept somewhat of a similar form, especially since about 44 years after the recapitalizations, gold made an important breakout (1978 and 2024).
In other words, since 2024 we have probably entered the final phase of the bank run, just like 1978 was the final phase that ended in 1980.
We are now in the 46th year since the 1980 recapitalization, and just like since the 1978 breakout, gold has been rising significantly since 2024. We don’t know if the bank run will end this year or if it will take a few more years.
However, we do know that it will likely end when gold has peaked and the U.S. dollar is significantly devalued like it was in 1934 and 1980, which incidentally were at (or very near) significant bottoms in the Dollar Index (DXY).
Moreover, there will likely be a significant landmark event like the 1934 U.S. dollar devaluation. It may end with a new U.S. currency (the Trump dollar, maybe). It could originate internally, or it could be forced upon America from outside (foreign nations).
All of these have not happened yet.
The gold charts suggest that price still has to rise significantly before we get to that phase. The price target of $42,000 on the chart above is probably a minimum provided that the current US dollar is still in existence when gold peaks.
Warm regards,
Hubert Moolman
(Hubert Moolman is an Accountant and gold analyst. HGM research is renowned in the fundamentals of gold, silver and money as well as factual analysis. Also publishes educational articles on gold, silver and the dangers of fiat money featured in top financial reports)
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