Silver prices down 10% and there is still room for more pain – analysts Kitco NEWS
Author: Gold News Club
Categories
Inflation policy and its supporters
Degussa Goldhandel/Dr. Thorsten Polleit/2-27-2020
“That said, the lesson to learn is this: Fiat money – be it US dollar, euro, Chinese renminbi, British Pound, Swiss Franc, etc. – will most likely continue to lose its purchasing power over time. Some perhaps faster, some maybe less quickly. But people should be aware that fiat money is no reliable store of value. There might be a point in time when the fiat money system crashes altogether – for inflation is a policy that cannot last. However, we do not know when the death knell of the fiat money regime will ring. That said, the minimum advice is this: Do not entrust your life savings to fiat currency; and do not expect the crash too soon.”
USAGOLD note: As Gresham stated: “Bad money drives out good.” Or to put a contemporary spin on it: “Fiat drives gold into hiding” – a trend that progresses quietly even as you read this post. The Ed Stein illustration cleverly makes the point.
Bloomberg/Justina Vasquez and Ranjeetha Pakiam/2-28-2020
“With stocks in freefall, investors usually turn to gold as a haven of last resort. On Friday, things got so bad that they had to cash in on the metal to cover losses in other markets, spurring its biggest drop since 2013. Gold has now joined the global asset sell-off as investors unload the metal to cover margin calls.”
USAGOLD note: The selloff in stocks is related to fears of a global virus contagion and an oncoming recession. The selloff in gold is related to speculators greening up to meet margin calls in the stock market. Of the two, which seems to be a temporary phenomenon and which the more permanent? Logic and common sense will ultimately prevail – particularly if the developing sentiment about the economy sticks and central banks move to blunt the first stages of a recession. As it stands on the year thus far, gold is still up 1.2%. Stocks are down 13.1% and silver is down 8.2%. (All three as of 1:31 MST, 2-28-2020)
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