In this discussion with Albert Lu of The Power & Market Report, I discuss India’s demonetization and why the cash ban has sharply increased Indian demand for gold.

When a government suddenly attacks cash, people naturally look for ways to protect their savings outside the banking system. In India, where trust in institutions is already weak and corruption is deeply embedded, gold remains one of the few forms of wealth that ordinary people understand and trust.

Watch the full discussion below:

Key Takeaways

• India’s demonetization is creating panic, confusion, and hardship across the cash-based economy.
• The cash ban is pushing people toward gold as a way to protect savings outside the banking system.
• Gold’s price in India has surged as people seek a store of value that the government cannot easily control.
• The policy is unlikely to eliminate corruption; instead, it is creating new opportunities for corruption, coercion, and arbitrary enforcement.
• India’s deeper problem is not merely bad policy, but weak institutions, low trust, and a state that increasingly treats citizens as subjects.