Month: July 2020

MarketWatch/Barbara Kollmeyer/7-28-2020

“That juiced the crowd expecting $2,000 an ounce soon, and leads us to our call of the day from Goldman Sachs, which has ditched its own $2,000 forecast and says we’re going to see $2,300 an ounce in the next 12 months.  The bank also lifted its silver outlook to $30 from $22 an ounce.”

USAGOLD note: Goldman ups the ante on both metals listing a number of concerns fueling its bullish assessment led by a potential shift at the Fed toward an “inflationary bias.”  It also raises concerns about the “longevity” of the dollar as the world’s reserve currency.

Bloomberg/Maeve Sheehey and Steve Matthews/7-23-2020

“The official numbers have begun to confirm what many Americans feel in their bones: the economy is buckling once again. Despite assurances from the Trump administration that better times are at hand, the worsening pandemic is restraining or even snuffing out the economy’s nascent recovery.”

USAGOLD note:  All of which raises the prospect of even more aggressive monetary and fiscal policies in the weeks and months to come – particularly if virus case counts continue to rise.

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Precious metals investors often use the gold-silver price ratio to decide which metal to buy.  Known as the GSR, it is derived by dividing the price of gold by the price of silver.A high GSR, a number above 60, in the past has meant that silver is the better investments.  A GSR below 60, gold.

In recent years, the GSR has been well above 60, hitting 104 a few months ago, which meant that silver was by far the better investment.  As I write, the GSR is about 80, which means that silver has gained on gold.  Yet, it has far to go to achieve a ratio of 60, which has been the average over the years.

Gold usually moves first at the beginning of a precious metals bull market.  But the GSR remains an important indicator.

In my 48-year career as a precious metals’ bullion dealer, I’ve seen the GSR at the 100 level only once before, back in the early 1990s.   And, I’ve seen it at 17 in 1980.  Then, of course, gold was the better buy.

In the bull market of 2008-2011, the GSR dropped to about 35 in 2011, which meant that silver holdings should have been switched to gold.  (Actually, the 2008-2011 precious metals run-up was a continuation of the bull market that started in 2000, with the dot-com bust.)

Investments less than $50,000 should probably consider silver, 90% silver coins being my preference.  They give greater flexibility when converting back to cash.

Gold Mining Stocks Face ‘Fat Pitch’ Opportunity as Earnings Loom  Bloomberg

Anxious investors are pushing gold prices to all-time highs  CNN

1. Scorecard: gold is not the real winner – how other metals ranked this year  Kitco NEWS
2. Gold prices today fall after surging ₹1,500 in 2 days, silver edges higher  Livemint
3. Gold may produce bigger gains than the stock market under this one condition  MarketWatch
4. Gold prices at a record high  WWLP.com
5. Gold price rally unstoppable; hits fresh all-time high, gains for 9th straight day  The Financial Express
6. View Full Coverage on Google News

The big question for gold bugs  Kitco NEWS

Is this gold’s market top?  Kitco NEWS