Because your cash will be worth 18% less in 10 years, and gold will be worth at least 18% more.
Nothing else can guarantee that rate of return.
For years, it was an unwritten rule. As of yesterday, it’s official policy: The dollars in your wallet are destined to lose at least 18% of their purchasing power during the next 10 years.
Lost in the noise of countless Federal Reserve announcements yesterday was a formal target of 2% annual inflation.
Actually, it’s worse than 18% over 10 years. For the Fed’s favored measure of inflation is not the heavily gamed consumer price index — CPI — or the even-more-gamed “core” CPI that assumes your cost of living isn’t really affected by food and energy.
After all, CPI is currently running 3.0% year over year. Whoops, too high. Core CPI is 2.2%. Still too high.
The Fed prefers something called “core personal consumption expenditures.”
That number is currently running 1.7%.
Voila! Applying the logic only central bankers are capable of divining, there’s not enough inflation!