(LifeSiteNews) — On this episode of The John Henry Westen Show, Drew Mason, managing partner of St. Joseph Partners, returns to discuss the Federal Reserve’s decision to cut interest rates, what that means for the economy, the benefits of gold and silver, and more.
I began the episode by asking Mason to explain the significance of the federal interest rate cut that was announced on Wednesday. He said this cut is the beginning of what’s called a “rate cycle,” which is typically not a “one and done” cut, but is either a raising or lowering of rates over several months or even years.
“So yesterday, they cut the interest rate that’s used with the banks by 50 basis points, or half of a percent, which is larger than their norm of 25 basis points. And [it] suggests they’re seeing enough data in the economy that they are concerned about the economy and where we’re heading,” he said.
Mason noted that this move will likely weaken the dollar on the global stage because foreigners won’t be paid as much in interest, which also has implications for the many Americans who save in dollars. He emphasized that there have been three Fed rate cycles this millennium, and one year after the Fed began lowering rates each time, gold was rated higher.
“In [20]01, it was 3 percent higher after the first cut that accelerated, and after the first rate cut in ’07, gold was 18 percent higher. And as our debts became more significant, our balance sheet deteriorated,” he said. “Our last rate cycle cut began in ’19, and a year later, gold was 35 percent higher than it was at the time of the rate cut cycle beginning. So, this is a whole other element to support what we believe is a very bullish case for investors to diversify into gold and silver at this moment.”
I noted that other countries seem to be investing in gold and asked Mason for his insight. He detailed how a coalition of foreign countries, not wanting to depend on the dollar anymore, created a new BRICS currency. “There’s no hope of that changing and us rescuing the purchasing power of the dollar. That is not to say it’s Armageddon for America or the end for America, but we’ve had several currencies as a nation already, and it is to say these other nations are aware of history, and when you can’t pay your debts back, purchasing power erodes in the currencies of those nations.”
Mason stressed that a dramatic increase in the share of non-dollar trading is coinciding with talk of a BRICS alliance. “At the same time, we’re seeing these countries vote in a very material way with their wallets, that they’re not going to wait for this BRICS currency to come out. They’re not waiting for anything; they are allocating to gold today.”
To hear more analysis from Drew Mason, watch or listen to my full interview. Protect your wealth with gold, silver, and precious metals here.
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