The Cost of Debt Is Rising — But the Return Is Falling

The Cost of Debt Is Rising — But the Return Is Falling | GSG Weekly Wrap 21 May 2025

Estimated reading time: 5 minutes

Weekly Price Overview – 21 May 2025

Gold and silver prices rose again this week — rebounding strongly off recent support zones.

🟡 NZD gold climbed $71 to $5,561, bouncing from key technical levels near $5,400. USD gold also gained, up $36 to $3,292.

⚪ Silver continues to show relative strength, with NZD silver up $0.40 (0.7%) to $56.01 and USD silver up $0.18 to $33.16. It’s outperforming gold near-term, supported by a dip in the Gold/Silver Ratio.

💱 The NZD dipped slightly (-0.17%) to 0.5920 but remains just above its 200-day moving average — a level to watch in the weeks ahead.

The charts suggest the metals remain in strong uptrends — and current pullbacks may offer continued buying opportunities.

Coins or Bars? Gold or Silver? What NZ Buyers Must Know in 2025

Buying bullion isn’t just about picking gold or silver — it’s about choosing the right format, purity, and strategy based on where (and how) you’ll eventually sell.

In this week’s featured article, we break down:

• The critical purity thresholds for GST-free investing
• Whether locally refined or global coins make more sense
• What kind of buyer you are — and what to buy accordingly
• How to build a smarter mix of coins and bars

🧭 Should You Buy Gold or Silver Coins or Bars in NZ? (2025 Guide)
👉 Read now

The Cost of Debt Is Rising — But the Return Is Falling

Moody’s just downgraded the USA’s credit rating. That puts them in line with S&P and Fitch. All three major agencies now rank the US one notch below perfect.

This downgrade might seem symbolic — but the real concern lies deeper.

As Charles-Henry Monchau said:

“What DOES matter is the fiscal and debt situation, which remain major worries.”

Few explain this better than Andre Chelhot of the Prague Finance Institute. He posted two powerful insights this week on what’s really happening behind the numbers.

📉 Chart of the Week: The Nightmare Keeping Treasury Awake

🧠 Interest costs are rising. Revenues are not. That leaves two options: spend less — or print more.

Chelhot shared a chart that’s been called Scott Bessent’s nightmare. It shows how much of the US budget is now going toward interest payments.

In the 1990s, high debt was balanced by falling interest rates and solid growth.
Today, it’s the opposite:

 ❌ Huge deficits
❌ Ageing population
❌ Global instability
❌ Fewer buyers for US Treasuries

This chart doesn’t just show fiscal pressure — it signals a shift in how markets see risk.

Markets are now pricing in monetization —
🏦 That’s when central banks print currency to buy government debt, helping cover the gap. It’s a short-term fix with long-term costs.

🔗 View the full post here →

Bonus Chart: More Debt, Less Wealth

Chelhot’s second chart asks a sharp question:

Is society still getting value from all this debt?

It tracks how much household wealth exists for every dollar of federal debt.

In 2008, it was almost 9 to 1.
Today, it’s closer to 5 — and falling.

Chelhot explains:

“There comes a point when the cost of new debt no longer justifies itself. And when that point is reached, society — as a whole — can decide that enough is enough.”

We may not be there yet, but that “breaking point” is becoming easier to imagine.

🔗 See the full post →

Meme of the Week: The Debt “Inheritance”

A cartoon that says more than any budget speech could…

🔗 Source: Hedgeye via Charles-Henry Monchau →

The cartoon might be funny — but the growing debt burden it reflects is all too real.

If that’s got you thinking about protecting your savings, we’re here to help.

📞 Talk to us today or learn more about how to buy gold and silver before debt-driven risks start impacting currencies, savings, and markets:

📧 Email: orders@goldsurvivalguide.co.nz
📞 Phone: 0800 888 GOLD (0800 888 465) or +64 9 281 3898
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