The gold price ran from $1,265 at the beginning of May 2019 to $2,089 in early August 2020. That’s a 65% move 15 months. Over that period of time gold outperformed every financial asset class. To some extent, the move was anticipating the price inflation that’s occurring now which resulted from the devaluation of the U.S. dollar with the Fed more than doubling the size of its balance sheet since March 2020. Since August the price pulled back technically from an overbought condition and a stampede of fast money speculators chasing the price higher. It looks like it may have bottomed out from the 13 month correction and is getting ready to make another big bull move.
But you can’t have conversation about where the gold price is and where it should be without discussing the official effort to prevent gold from serving its role as the canary in a coal mine with respect to the failure of the Fed’s monetary policy and the Government’s failing fiscal and geopolitical policies.
Kai Hoffman of Soar Financial invited me on to his podcast to discuss the precious metals sector and the potential for a Fed taper. I also named a few mining stocks that I like right now: