The Increase in Oil and Gold Prices: An Objective Economic Process

Applying the cyclical theories of Kondratiev, Kitchin and other noted economists to present realities and trends, this essay makes for reaching predictions about the evolution in the prices of two “barometric” commodities—gold and oil. It points out that the world has been in the midst of the “bearish wave” of Kondratiev's sixth cycle since 2008, which will last until 2020 at least. Accordingly, the neoliberal economic paradigm will end and a “neo-Keynesian” China will rise as the new hegemon, with Asia replacing the US and Western Europe as the global leader. The demise of the US dollar based monetary system resulting in a stupendous rise in gold prices will be succeeded by a new regime negotiated between a few major regional blocs. Meanwhile, the next few years are likely to be marred by economic depression and political turmoil.