Gold is set to eke a third weekly gain despite going into next week’s likely 25-basis point lift in interest rates. Markets expect the Federal Reserve to pause again on further hikes.
Don’t expect the Fed to act or react according to what seems logical to you. And, don’t assume that it’s their job to safeguard your financial interests. Expect the unexpected.
Silver has outperformed gold of late leading us to look once again at the Gold/Silver ratio. The ratio continues to look like a huge top suggesting holding silver over gold might be a good idea.
Robert F. Kennedy, Jr. announces sound money plank and tax exemptions. Whether a viable sound money candidate emerges on the Republican side remains to be seen.
I believe that the precious metals sector will soon begin a cyclical, sustained move higher that will see gold surpass $2,000 and silver trade up to $30, for starters.
In any event, energy, food and precious metals remain undervalued assets, while commercial/residential real estate and their mortgages (a.k.a. death pledges) decline and default with little media awareness yet.
China as a whole can buy gold in amounts tolerated by the PBoC but can’t sell. What if the Chinese citizenry starts to fully grasp they can’t sell at the international price at all times? Put differently, what’s the point of owning gold if you can’t sell?
It is contagious, and it is part of the Fed’s worst nightmare for inflation as the flames have now risen up the walls and are lapping across the ceiling.
Any inflation analysis that ignores housing misses not only the elephant in the room, but the room itself.
And guess what? The official inflation measures do exactly that.
