Silver is a better investment due to massive financial bubbles everywhere...
- SRS Rocco Report
Monday, 31 August 2020
Wednesday, 26 August 2020
Monday, 24 August 2020
Golden Rule Radio: Inflation Pressures Mounting or Can We Just Print Forever?
Neil Howe is the Managing Director of Demography at Hedgeye. President of LifeCourse Associates. Author of The Fourth Turning, Generations, and Millennials Rising.
- Source, Golden Rule Radio
Saturday, 22 August 2020
Jim Cramer Warns: The Stock Market Could Crash, This Bubble is Very Dangerous
This time Cramer is saying something logical. Watch out for the stock market!
During one of his latest shows, Cramer urged investors not to be fooled by all time highs as millions are going homeless, millions are losing their jobs, thousands of small businesses are running out of cash and closing their doors, there's no reason to be bullish going into the end of 2020.
The only reason the stock market is looking good is because the Federal Reserve is printing trillions and is also buying bonds in huge numbers.
When push comes to shove and the currency being printed ends up liquid, a rude awakening is coming.
While one would usually be better off not doing what Jim Cramer says, he's not wrong about the concerning signals the stock market is giving off.
- Source, WAM
Friday, 21 August 2020
$10000 Gold Or A Triple Top?
Predictions for gold's price are based on seemingly sound fundamentals and logic; but the fundamentals are incorrect and presented in unrealistic context. Here are some things to keep in mind when you see any predictions for the price of gold.
GOLD IS NOT AN INVESTMENT
Gold, itself, is not an investment. Gold is real money and the original measure of value for everything else.
A higher gold price is inversely correlated to a decline in the purchasing power of the US dollar. This, can be seen historically on the chart (source) below...
Over the past century, the price of gold in US dollars has increased one-hundred fold; from $20.67 per ounce to its recent high of $2061.00. That correlates, inversely, to a ninety-nine percent drop in the purchasing power of the US dollar.
Another way of saying this is that one dollar a century ago is now worth only a penny. Or, it takes $1,000,000 today to match the purchasing power of $10,000 in the 1920's.
GOLD IS NOT FORWARD-LOOKING
Increases in the price of gold come "after the fact". Gold's price action is not anticipatory of future conditions, events.
In the chart above, there are two distinct periods of rising gold prices. Both of those periods were a decade in length: 1970-80 and 2000-2011. And both of those periods followed longer periods of time - forty years and twenty years - during which gold's price was not increasing.
In both instances, the price of gold was playing 'catch-up':
"The 1970s were a catch-up period for the price of gold relative to the U.S. dollar's loss in value over the previous four decades. That, and the anxiety and anticipation created by the realization that things were far worse than we had previously known, led to outsized gains." (see Gold And The Elusive Chase For Profits)
The period from 2000-11 was similar in that gold's increasing price from a low of $250 to its then all-time high of $1895 reflected reaction to the cumulative effects of inflation that had continued to erode the value of the US dollar after 1980.
During the period 1980-2000, real growth rates for stocks and other investments were the best ever seen in the US and most of the world; the economy boomed. Also, considerably mild effects from ongoing inflation kept the US dollar stronger. Again, inversely reflecting the dollar's strength, gold's price declined for nearly twenty years; before turning up again.
GOLD AT $2060 TODAY IS CHEAPER THAN IN 1980
The surge to recent new all-time highs for gold was also a catch-up period. The move from a low of $1060 four years ago to $2060 a couple of weeks ago reflected depreciation, i.e., an actual loss in purchasing power, of the US dollar since 2011.
While the price of gold is higher in dollar terms than in 2011, and much higher than in 1980, the fact remains that one ounce of gold today at $2060 is no more valuable than it was at $850 in 1980.
Here is what that looks like on the same chart from above, but adjusted for the effects of inflation...
Looking at this chart, it should be apparent that gold at $2000 is fully-priced. Unless you are convinced that the US dollar is going to crash soon, then expectations for much higher gold prices at this point are unwarranted.
If, on the other hand, you expect the US dollar to drop in value "horrendously", as some have said, then can gold's price go higher than $2100? Yes, absolutely; but that will only happen after that further deterioration becomes evident and you find yourself paying more and more for the things you need.
This means that no matter how high the price of gold goes, it will only be indicative of how weak the US dollar gets. And, on an inflation adjusted basis, the price of gold will still not exceed its previous peaks of 1980 and 2011.
For example, let's say that over the course of the next year that the value of the US dollar drops in half. A fifty percent loss in purchasing power means that it would cost twice as much for ordinary goods and services a year from now, and people would be very reluctant to accept US dollars in payment.
Gold's price would double to approximately $4000 per ounce; but you wouldn't have any real profits. You would need the increase in gold's price just to stay even with the decline in purchasing power of the US dollar.
The worse the decline in the dollar, the greater the loss in purchasing power. The more violent the decline, and the more rapidly it occurs, even to the point of complete repudiation, could take the price of gold to absurdly high levels in dollar prices. But it's price won't matter.
Think of it this way. If you wake up tomorrow morning and find that gold is quoted at $10,000, what would you do?
In order for that to happen, the US dollar would have to be virtually worthless. No vendor will accept dollars, so what difference will it make that someone -anyone - says that gold is then worth $10,000? Would you sell it? If you do sell it, what would you use to pay for things you need?
If gold were priced at $10,000 per ounce tomorrow morning, accompanied by a crippled US dollar at death's door, gold's price in inflation-adjusted terms won't be any higher than it is now. And the symmetry of the three tops in the second chart above will still be identical.
Gold's value is constant. It is real money and a store of value. A higher price for gold is only indicative of a corresponding decline in in the value of the US dollar.
GOLD IS NOT AN INVESTMENT
Gold, itself, is not an investment. Gold is real money and the original measure of value for everything else.
A higher gold price is inversely correlated to a decline in the purchasing power of the US dollar. This, can be seen historically on the chart (source) below...
Over the past century, the price of gold in US dollars has increased one-hundred fold; from $20.67 per ounce to its recent high of $2061.00. That correlates, inversely, to a ninety-nine percent drop in the purchasing power of the US dollar.
Another way of saying this is that one dollar a century ago is now worth only a penny. Or, it takes $1,000,000 today to match the purchasing power of $10,000 in the 1920's.
GOLD IS NOT FORWARD-LOOKING
Increases in the price of gold come "after the fact". Gold's price action is not anticipatory of future conditions, events.
In the chart above, there are two distinct periods of rising gold prices. Both of those periods were a decade in length: 1970-80 and 2000-2011. And both of those periods followed longer periods of time - forty years and twenty years - during which gold's price was not increasing.
In both instances, the price of gold was playing 'catch-up':
"The 1970s were a catch-up period for the price of gold relative to the U.S. dollar's loss in value over the previous four decades. That, and the anxiety and anticipation created by the realization that things were far worse than we had previously known, led to outsized gains." (see Gold And The Elusive Chase For Profits)
The period from 2000-11 was similar in that gold's increasing price from a low of $250 to its then all-time high of $1895 reflected reaction to the cumulative effects of inflation that had continued to erode the value of the US dollar after 1980.
During the period 1980-2000, real growth rates for stocks and other investments were the best ever seen in the US and most of the world; the economy boomed. Also, considerably mild effects from ongoing inflation kept the US dollar stronger. Again, inversely reflecting the dollar's strength, gold's price declined for nearly twenty years; before turning up again.
GOLD AT $2060 TODAY IS CHEAPER THAN IN 1980
The surge to recent new all-time highs for gold was also a catch-up period. The move from a low of $1060 four years ago to $2060 a couple of weeks ago reflected depreciation, i.e., an actual loss in purchasing power, of the US dollar since 2011.
While the price of gold is higher in dollar terms than in 2011, and much higher than in 1980, the fact remains that one ounce of gold today at $2060 is no more valuable than it was at $850 in 1980.
Here is what that looks like on the same chart from above, but adjusted for the effects of inflation...
Looking at this chart, it should be apparent that gold at $2000 is fully-priced. Unless you are convinced that the US dollar is going to crash soon, then expectations for much higher gold prices at this point are unwarranted.
If, on the other hand, you expect the US dollar to drop in value "horrendously", as some have said, then can gold's price go higher than $2100? Yes, absolutely; but that will only happen after that further deterioration becomes evident and you find yourself paying more and more for the things you need.
This means that no matter how high the price of gold goes, it will only be indicative of how weak the US dollar gets. And, on an inflation adjusted basis, the price of gold will still not exceed its previous peaks of 1980 and 2011.
For example, let's say that over the course of the next year that the value of the US dollar drops in half. A fifty percent loss in purchasing power means that it would cost twice as much for ordinary goods and services a year from now, and people would be very reluctant to accept US dollars in payment.
Gold's price would double to approximately $4000 per ounce; but you wouldn't have any real profits. You would need the increase in gold's price just to stay even with the decline in purchasing power of the US dollar.
The worse the decline in the dollar, the greater the loss in purchasing power. The more violent the decline, and the more rapidly it occurs, even to the point of complete repudiation, could take the price of gold to absurdly high levels in dollar prices. But it's price won't matter.
Think of it this way. If you wake up tomorrow morning and find that gold is quoted at $10,000, what would you do?
In order for that to happen, the US dollar would have to be virtually worthless. No vendor will accept dollars, so what difference will it make that someone -anyone - says that gold is then worth $10,000? Would you sell it? If you do sell it, what would you use to pay for things you need?
If gold were priced at $10,000 per ounce tomorrow morning, accompanied by a crippled US dollar at death's door, gold's price in inflation-adjusted terms won't be any higher than it is now. And the symmetry of the three tops in the second chart above will still be identical.
Gold's value is constant. It is real money and a store of value. A higher price for gold is only indicative of a corresponding decline in in the value of the US dollar.
- Source, Silver Bear Cafe
Wednesday, 19 August 2020
Wolf Street Report: The Rich Got Richer in the Pandemic, Why?
- Source, Wolf Street Report
Monday, 17 August 2020
Liberty & Finance: Disasters Everywhere, Unfolding at the Same Time
- Are we truly under greater threat to our existence than at any other point in history?
- How widespread has “prepping” actually become?
- Has the pandemic response awakened greater awareness?
- How much has it mobilized people to action?
- What’s the difference between “hoarding” vs. stockpiling that actually makes communities anti-fragile?
- And what lies ahead for the well-being of the next generation? Bradley Garrett, author of the new book “Bunker
- Building for the End Times,” visits Liberty and Finance / Reluctant Peppers to reveal the findings of his 3
- Years investigation into the most extensive preparedness efforts in the world.
The lessons may surprise you, or encourage you to take vital next steps!
- Source, Reluctant Preppers
Sunday, 16 August 2020
Friday, 14 August 2020
Peak Prosperity: Better Food Equals A Better Future
So having more self-sufficiency when it comes to calories, as well as better nutrition to boost your immune system, just make good sense. Hence: start a garden. In this week’s podcast, we welcome back Joel Salatin.
Labeled by The Washington Post as “the most famous farmer in America”, Joel has spent his career advocating for sustainable farming practices and pioneering models that show how food can be grown and raised in ways that are regenerative to our topsoils, more humane to livestock, produce much healthier & tastier food, and contribute profitably to the local economy.
Fresh off huge demand for his farm’s output during the covid lockdown and from releasing two new books, Beyond Labels and Polyface Designs, Joel gives yet another heaping dose of common sense ways we can improve our ecology, economy, food production and wellness — starting with a healthier approach to dealing with the coronavirus.
- Source, Peak Prosperity
Wednesday, 12 August 2020
A Massive Reset is Coming, The Dollar Could Collapse in the Coming Years
Lior has been incredibly accurate over the years when it comes to calling market ups and downs. As Lior explains, this is the end game.
This is absolutely huge.
We have never seen anything quite like this. In fact we've never seen anything even close to this in world history and we should expect many years before we see a full recovery if we ever do see one.
- Source, WAM
Monday, 10 August 2020
Why is the Price of Silver Going Up and Why Does it Have a Lot More Room to Move?
A large driving force behind recent momentum is the resurgence of generalist investor interest in the sector, said Gary Wagner, editor of TheGoldForecast.com.
“The reason I believe that might have happened is one, there’s talk of scarcity, but two, the millennials, people that have put money into the U.S. equity markets that are in their thirties and forties, realize they need a safe haven asset in case there is a bubble,” Wagner said.
- Source, Kitco News
Saturday, 8 August 2020
Golden Rule Radio: Bullion Soars As Gold Breaks Records and Silver Climbs
This week we cover the prices of gold and silver as they continue to see strength across the board. We will also cover the price movements of platinum, palladium, the U.S. Dollar index, the equity sector and more.
- Source, Golden Rule Radio
Friday, 7 August 2020
Thursday, 6 August 2020
Real Vision Finance: When Will The Passive Bubble Burst?
Mike Green gives a strategic update on the markets, and, through the lens of his renowned critique of passive investing, analyzes flow data on ETFs and mutual funds to conclude that the markets could be due for some turmoil in the coming months.
Green and Bennington also discuss today’s interview with Green and Rob Arnott, one of the world's leading quantitative investors. Green also shares his views on "volmaggedon" and the similarities between short-vol and bonds.
In the intro, Jack reviews recent FAANG earnings and gives a preview of Jason Buck's three-part "Ahead of the Curve," a deep-dive into volatility featuring interviews with Chris Cole, Jerry Haworth, and Bastian Bolesta.
- Source, Real Vision Finance
Tuesday, 4 August 2020
Ron Paul: GDP Crash, V-Shaped Recovery or Greater Depression? Who's To Blame?
The fallout from Americans sacrificing their liberties to government power is overwhelming.
With suicides, drug overdoses, a doubling in domestic violence, and tens of millions unemployed, two things should come to everyone's mind: "Look what they've done!" and "Americans should never sacrifice their liberties again!"
- Source, Ron Paul
Sunday, 2 August 2020
Investors Buying Gold & Silver At Any Price For Wealth Preservation And Not Selling
Dave Kranzler joined Silver Doctors on Tuesday, July 28, for a robust discussion on gold, silver, the US dollar, the stock market, the situation on Main Street, and a whole lot more!
- Source, Silver Doctors
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