Written by Jan Nieuwenhuijs for Voima Insight.
As the coronavirus is spreading around the world, its ramifications on the economy will boost the price of gold.
The coronavirus is swallowing the world. What started in January as a local issue in Wuhan, China, is now a global problem. Although there remains uncertainty around the health hazards of the virus, its impact on the world economy is clear. Early on, we witnessed large segments of the Chinese economy grinding to a halt and supply chains collapsing. As the virus is spreading, major economies will likely suffer the same fate as the Chinese. Across the globe, schools and companies are closed. Events are canceled, and traveling is brought to a minimum. People that can work from home are asked to do so.
The coronavirus will cause the economy in Europe to suffer a significant setback (as in China). It will hurt businesses and, in my view, will push the economy into a recession. On Wednesday, European Union officials publicly stated they are “starting the internal reflection” on their methodology for dealing with failing banks. Banks, once again, will face bankruptcy.
Why Gold Will Rise