Is silver near a top? Kitco NEWS
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Is silver near a top? – Kitco NEWS
Month: July 2020
MarketWatch/Staff/7-25-2020
“Mobius says that investors find themselves in a curious spot where buying stocks and gold are both viewed as ways to preserve capital and avoid erosion from inflation. ‘We’re in a very interesting situation where people are looking at stocks to preserve their capital because stocks will adjust to inflation and also gold. Their sort of hedging their bets.’”
USAGOLD note: Mobius has been a vocal advocate of gold on the interview circuit for over a year now. He points out in this article that mine ouput “should be declining” as a result of COVID-19.
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Will gold hit new historic highs?
NewsMax Finance/Ed Moy/7-23-2020
“While the Fed, institutional investors, and pension funds own much of the debt that finances our fiscal spending, foreign countries account for nearly 30%. And chief among those foreign countries is China. Given that our relationship with China is quickly deteriorating, it is not clear what appetite it has for funding our economic recovery. So, expect gold prices to break new records until the economy is on a predictable path toward recovery without the fear of inflation, which given the early stages of the economic crisis caused by this pandemic, could be some time.”
USAGOLD note: Moy was Director of the United States Mint during the 2008 financial crisis.
- Gold Is Rallying. The Mining Stocks Are the Best Way to Play It. Barron’s
- Gold miner stocks charge broadly higher as gold prices reach records MarketWatch
- Gold mining stocks are outperforming gold Invezz
- Why Silver Miners Like Coeur Mining, Endeavour Silver, and Fortuna Silver Mines Took Off Today Motley Fool
- Precious Metal & Mining Top Last Week: Winning ETFs Yahoo Finance
- View Full Coverage on Google News
- Gold price hits record high on new fears for the economy CNN
- Bullish cocktail fueling strong gains in gold, silver Kitco NEWS
- Gold Price Hits A Record High As Pandemic Drives Uncertain Outlook For Economy : Coronavirus Live Updates NPR
- Gold prices hit all-time high, and it’s a bit of a mystery why CBS News
- Gold price jumps to new record, over $1930 per ounce USA TODAY
- View Full Coverage on Google News
If You Think Gold Prices Will Climb To $10,000, Forget It Forbes
Does current gold price make sense? McKinsey warns these sectors destroyed permanently Kitco NEWS
Gold price marks highest settlement and intraday price on record MarketWatch
Gold And Silver Are Just Getting Started Forbes
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Silver’s Surge Leaves Naysayers in the Dust
With silver breaking out decisively to the upside, bears are running for cover.
We had noted in our July 13th News Alert, “We are paying especially close attention to the bull vs. bear tug-of-war in the silver market around $19/oz. If the bulls yank prices decisively above that level on a strong close, short covering by capitulating bears could help drive a powerful breakout rally.”
That’s exactly what happened. The rally really accelerated once the $20/level was taken out last Monday. The bears have capitulated big time!
Also being forced to re-think their positions are gold-only bulls within the precious metals camp. Although they represent a minority viewpoint, some stubbornly cling to the view that only gold is sound money. They view silver as an industrial metal and tend to shun it as an investment.
The gold-only bugs felt vindicated in March when the gold:silver ratio shot up to over 120:1. But as we argued at the time, the unprecedented cheapness of silver versus gold represented a once in a lifetime opportunity to buy silver.
The white metal has since outperformed gold dramatically, causing the gold:silver ratio to fall precipitously. So far it has only fallen to what in years past would have been a high point in the range.
Silver has much more room to outperform. We think the gold:silver ratio can continue to fall in the months ahead, though not necessarily at the current pace.
Fundamentally, the character of both the silver and gold markets has changed during the course of this year’s rally. Retail bullion buying is not only back; it’s going through the roof!
Many dealers are struggling (and failing) to keep up with demand. We are working tirelessly to procure ample inventory and fulfill the truly massive amount of orders that continue to pour in here at Money Metals Exchange. Our staff is working 7 days a week to keep orders moving out the door more quickly.
As a result of the surge, available inventory of silver coins, bars, and rounds have become tighter as we’ve moved through July, driving up premiums once again. The greatest challenge has been privately minted bars and rounds, with mints backordered by several weeks in most cases. Even the acquisition of silver grain and 1,000 oz bars for minting purposes is becoming an issue.
Meanwhile, inflows into gold and silver exchange-traded instruments are also surging.
ETF holdings of gold assets have risen for 18 straight weeks – the longest such streak since 2006.
Another bullish factor was actions by Sprott Physical Silver Trust, a closed-end financial product that holds a fixed amount of silver. It recently filed to expand its asset base by up to $1.5 billion, which represents close to 65 million ounces of new silver. That’s equivalent to almost 8% of annual silver mine production!
Silver is a smaller market than gold in terms of the value of total consumer demand for jewelry and bullion. It therefore has the potential to move more dramatically at the margins in response to increases in demand and/or shortfalls in supply.
Silver naysayers could be left speechless by the price moves still to come as the realities of rising physical demand and an intractable mining supply deficit forces the market to find a new equilibrium.
