Interview: Keith Weiner, Founder of Monetary Metals

"A good money, like good law, must operate without regard to the effect that decisions of the issuer will have on known groups or individuals. A benevolent dictator might conceivably disregard these effects; no democratic government dependent on a number of special interests can possibly do so.”

F. A. Hayek

Denationalization of Money

Institute of Economic Affairs (1978)

July 27, 2026 | In this special edition of The Institutional Risk Analyst, we feature a conversation with Monetary Metals founder Keith Weiner, an economist who is a leading authority in the areas of gold, money, and credit. Keith has made important contributions to monetary theory and written some serious research in the sector. Before Monetary Metals, he founded DiamondWare, a software company that developed 3D voice technology, sold to Nortel in 2008. He is the President of the Gold Standard Institute USA. He earned his PhD from the New Austrian School of Economics. Keith spoke to us last week from London.

The IRA: Good morning, Keith. You're an Austrian school adherent which is not the norm for successful business people. We largely agree with the Austrian perspective. As F.A. Hayek noted no democracy can have sound money. The debt grows and essentially impairs all value in a creeping nationalization. We don't know what we're going to do with this current economy though. Inflation (a/k/a “affordability”) is turning everybody into socialists, so what are you going to do?

Weiner: No, that's right. It often seems that policy interventions unintentionally create new challenges, which then leads to calls for even more government involvement. I consider myself really to be a serial entrepreneur. I majored in computer science back in college. Dropped out of school to follow the dream that so many of my heroes did before me and build a software company. I sold that software company, it was called DiamondWare, to Nortel Networks in 2008.

The IRA: You sold the company on the eve of the Great Financial crisis, quite a feat.

Weiner: The whole process of the deal was really extraordinary for us. Nortel was doing several deals in 2008 and we closed our transaction literally before the wheels came off of the technology sector and the entire US economy. It's very surreal to go through that, watching everything go over the edge. And that’s when I started to study gold. I was aware of free market ideas. I'm an Objectivist and Ayn Rand fan. I was aware of gold and the idea of free markets. But my nose was to the grindstone building a business. You get to that point of monetizing your work and now the world is going into the abyss. And I thought, how do I protect myself? DiamondWare represented 14 years of work and energy. I could never get that back. I didn't want to lose it to a Bear Stearns or to a Lehman or who knows how many other banks were about to fail. I felt like a moth drawn to a flame with gold, just obsessively studying everything I could get my hands on. I made it through the GFC basically, 100% in cash. You want to talk about luck? If the transaction had closed six months earlier, I would have bought all kinds of investments, probably, and taken a significant loss in the GFC. But after that, I started to get more and more interested in the idea of gold. I came across the writings of the Hungarian professor Antal E. Fekete and without really intending to, became a student of his ideas.

The IRA: Fascinating personal history. Most of us with fiat assets tied to stocks or mortgages were broke in 2008 and several years after, so your reaction is very logical. We often think that the manic, hysterical speculation we see in markets today is a legacy of the shock of 2008. A whole generation of investors came close to being wiped out until the Fed under Chairman Ben Bernanke rode to the rescue with more debt and inflation. How did you decide to start Monetary Metals?

Weiner: My development team had followed me to hell and back, and they said, when's the next gig? Ready to jump, right? But while the work in software was real, I came to think of gold as the solution to the bigger problem we have now. In a normal world, it would have been another software company, but we do not live in a normal world.

The IRA: No, as we wrote in our book Inflated: “Money, Debt and the American Dream,” Americans don’t like to pay taxes. Winning WWII and the Cold War gave us the idea that the rules do not apply to us. The New Deal, the Great Society, and $40 trillion in federal debt, are all baby steps to socialism. Like the Greeks and Romans before us did to their money, we are destroying the dollar.

Weiner: Precisely. So, I said to my team, well, unfortunately, I'm going into gold. I have a big software team now, but at that time, I didn't know what I needed. And so, I just thought, OK, I want to be part of the solution. And I thought that in a gold system, interest or a return on metal is the key to the whole thing.

The IRA: An elegant conception.

Weiner: So I said the return on gold, the interest rate, in the gold standard is the regulator of flow into the market. And if the interest rate's zero, you've got no flow. And if the interest rate is maxed out, whatever that may be— marginal time preference, ordinary rate of interest, whatever you want to call it— then you get flow of gold to the market. And settings in between. So, I said, okay, that becomes a business thesis. Let's offer interest on gold and draw gold into the market and avert the disaster that I saw coming. And I wrote a paper called 'When Gold Backwardation Becomes Permanent.'”

The IRA: Great paper. You said in 2012 gold was not in shortage. Do you still hold that view on the supply-demand balance?

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Don't forget to watch “The Wrap with Chris Whalen” on The Julia LaRoche Show every Saturday on YouTube to catch our discussion of what’s hot and what’s not in the world of finance and investing. 

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Weiner: Backwardation is the best measure of shortage. Backwardation happened for one day during the depths of the episode when Gordon Brown sold half the UK’s gold between 1999 and 2002. And it happened for a few days in December 2009. But it was not happening in 2012.

The IRA: At the moment, market commentators say that the price of gold is weak because of the prospect of higher interest rates. Last year, it didn't matter. But today, it seems to matter. At least people think it matters. What is your view of the link between gold prices and interest rates on fiat?  

Weiner: We produce an annual gold market outlook report. And over the years, we've looked at all the various things that are alleged to be correlated to or causal of the gold price. And interest rates, inflation, and interest rates are the ones that come up the most. We looked at, I don't know if it was the Fed funds rate or the one-week T-bill rate, which are obviously almost perfectly the same.

The IRA: The FOMC killed the Fed funds market years ago when they turned it into a policy tool. T-bills is probably the best market indicator.

Weiner: We looked at 10-year Treasury notes. We looked at so-called real interest rates, TIPS. And over a long period of time, of time there just isn't a correlation. The thing that makes gold unique is that it doesn't correlate with anything but in shorter time windows it can absolutely get into a pattern where gold is moving in relation to other markets. You can look at the war with Iran and oil prices, and gold was almost perfectly inverse to oil prices. And trading was essentially influenced by news of whether the war is about to be over, whether it's going to escalate. And for long periods of time, that's not so. When the Fed says okay, we're cutting rates, suddenly the apparent connection disappears.

The IRA: In western markets, investors tend to think of gold prices as just another short-term indicator price. The Fed’s interest rate cuts from last year tended to be a negative, at least in terms of what people think, and mostly in the West. If you're out in Asia, in Shanghai, or in India, you get a very different view of the world.

Weiner: Oh yeah, and also include Turkey and the Arab world. I spent a fair bit of time in the Middle East. They don't perceive gold the same way as Americans at all. But the irony of the whole thing is that, number one, is that we're in this very long-term falling rates cycle. I published my paper on the Theory of Interest Rates and Prices and why that's so.

The IRA: As you’ve written, the problem is debt. Total worldwide debt (government, corporate, and household) stands at a staggering $353 trillion. This equates to roughly 305% of global GDP, meaning the world owes more than three times what it produces in an entire year. And much of this debt is bad and will never be redeemed. We are in what Minsky labeled the third or Ponzi Phase, where debtors issue more debt or stock to avoid default. The phenomenon of payment-in-kind (PIK) by zombie private equity portfolio companies illustrates the larger problem.

Weiner: Right. Debt is a very long-term cycle. I'm sure you've looked at the zombie problem. Before 2022, something like 20% of all corporate debt was zombie debt. I have not seen an update of that BIS graph by in years, but one can only imagine how much greater a percentage is zombie debt at these rates versus essentially zero.

 Source: BIS

The IRA: The BIS updated the original paper by Ryan Niladri Banerjee and Boris Hofmann in 2022, but the problem has gotten far worse as the private equity/credit sector has grown. Moody's reports that default rates on private equity portfolio companies are in the high teens or a "CCC" bond rating equivalent. So from the perspective of gold, how does this cycle of debt accumulation in fiat currencies end?

Weiner: The key point to make about gold and an eventual backwardation isn't a gold price correlation to interest rates, but a gold basis correlation to interest rates. The basis spread is far more important than the price level when we talk about gold. In my backwardation thesis, I argue that we'll get to a point where essentially gold withdraws its bid on the dollar entirely. And gold goes into permanent backwardation. Gold for spot delivery becomes more and more and more expensive relative to a contract to deliver it in the future, which is essential. The dollar becomes entirely distrusted and devalued until eventually people will experience hyperinflation. But more than a devaluation of money the backwardation of gold really represents a collapse in trust of the monetary system and the counterparty— not a quantity of dollars —phenomenon.

The IRA: It's a psychological thing, too, because in the West, they mostly speculate on price, whereas in the Far East and India and Turkey and those other markets, they want to take delivery of physical gold. They want the metal.

Weiner: Absolutely. I've had this discussion with several of the prominent gold analysts. They always break down gold demand and draw graphs of demand curves. They always talk about jewelry and investment as two different categories. And I'm like, you need to spend a little bit of time in India. Because they don't make that distinction that you do. Gold jewelry is investment demand in India. It's higher quality, higher gold content than jewelry in the Europe or the US. In the Middle East, India and much of Asia, fine gold objects are money.

The IRA: Keith, Monetary Metals has developed a model to pay investors a return on gold holdings. How does this change the calculus of the cost of holding physical gold?

Weiner: There's research that most of the major private wealth groups at the big banks have done over the decades. And that is, what if you took a standard 60-40 portfolio and you put a little slug of gold in it? Call it 4%. And so, then they measure, okay, what do you get in terms of results from this? If you measure the results over decades. They find that you get slightly better returns with an allocation to gold. Not so much to write home about, but more importantly, you get lower volatility, smaller drawdowns, better Sharpe ratio. Hmm. So that makes sense, right?

The IRA: Yes. Please continue.

Weiner: Now, the problem is when they use an index value for Treasuries and for stocks like the S&P 500 and for gold, they'll use the London Bullion Market Association  fix or something like that. OK, but the problem is for stocks and for Treasuries, what you get in your portfolio is a pretty good match for that benchmark. But for gold, there's a real cost to carry physical metal. Our average customer is paying 75bps for storage before they sign up for Monetary Metals. But if you plug in even 50 basis points of cost, the investment scenario for gold is less attractive than holding securities. The private individuals can get excited about betting on gold's going to be $50,000 by tomorrow morning, but institutions don't function that way. The cost of holding physical gold is a disincentive for institutional investors.

The IRA: Correct. We have had this conversation with many institutional investors. So how does paying a return on gold change the investment scenario?

Weiner: We replicated the original research as the banks have done it, having accurately included the cost of carry, to reflect the real world. Then we did a third scenario: we said, what if you got three percent interest on that gold instead of a negative cost of carry? We're actually paying our customers four percent on gold at the moment, but we modeled it with just three. And at 3% interest, first of all, over decades, the upside of just having a little bit, 4% of gold in your portfolio, runs away. It's not a small amount. Right. And the Sharpe ratio is even better. Drawdowns are even smaller. Volatility is even better. And so, from an institutional standpoint or even for an individual investor like a family office who thinks institutionally, it makes a ton of sense. When Monetary Metals offers a way for investors to earn a return on gold apart from the price appreciation of the metal, the prospective investment return changes dramatically. But if you increase that allocation to gold from 4% to 8% to 10% to 12%, the scenario continues to get sweeter. I think, as far as having 20% of the portfolio being gold, we never wanted to go on record of saying that or suggesting that or anything because people will say that's crazy talk.

The IRA: Maybe not so crazy. We have about 15% exposure to gold and silver in our portfolio today. When you look at the growing pile of public and private debt around the world and how much of it will never be repaid, maybe having 20% exposure to gold and silver does not sound so crazy Keith. Thank you for your time.

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