30 August 2016: David Buik, market commentator at Panmure Gordon, says despite desperate attempts to ‘wean the US economy off’ low rates, the ‘prevarication’ is causing uncertainty. David also says the Fed is trying to move against the global trend. Related Posts:EUR/USD. April 12th. ECB meeting: confidence in rate cut… April 12, 2024 On Thursday, […]
The trading week was starting to look as though it was going to end without any excitement. Wow, did that ever change on Friday! On Wednesday Aug 24th, the stock market sold off to a level which I consider to be an extreme oversold condition for the week. While I do have several criteria as […]
The Jackson Hole Summit takes place every year in a valley in the US state of Wyoming. The meeting brings together all the local Federal Reserve banks in the States, and the outcomes from the conference can have global ramifications. With the Fed caught in a monetary policy dilemma, we look at which markets will […]
17 August 2016: Tim Allen, blur Group CFO, explains how the company has managed to cut cash burn by 58% and that the business is now moving to the next phase on from its operational pilot stage.
Michael Hodgson, Serabi Gold CEO, discusses the position of the company in South America. He delves into how the BRL/USD exchange rate is giving the effect of pushing up costs, yet the margins remain. He explains how shares are not pricing in the growth expectation, as Serabi expands its mines. Learn more about Serabi Gold: […]
9 August 2016: Ajay Paliwal, OPG Power Ventures, says the current fiscal year has started well and the expectation is the record results recently published can be repeated. Ajay also talks about the move into solar power generation. Related Posts:Technical Analysis – Goldman Sachs stock gains on strong… April 15, 2024 Goldman Sachs shares pull […]
CEO of Solo Oil, Neil Ritson, elaborates on the company’s exciting ventures in Tanzania where there has been vast opportunities with advantageous low cost production. More locally, Neil talks of discoveries in Horse Hill and the Isle of Wight, but does concede times are tough in this challenging climate. Read more about Solo Oil: http://www.ig.com/uk/ig-shares/solo-oil-plc-SOLO-UK?CHID=9?QPID=1414138385&QPPID=1 […]
Ben Kumar, Seven Investment Management, runs a quick eye over earnings at the tech giants including Alphabet, Amazon, Apple, Facebook, Netflix and Twitter. Ben also speculates on ‘what next’ in the drive for expansion. Website: http://www.ig.com/uk?CHID=9&SM=YT Twitter: https://twitter.com/IGcom Facebook: https://www.facebook.com/IGcom Google Play: https://play.google.com/store/apps/details?id=com.iggroup.android.cfd&hl=en_GB iTunes: https://itunes.apple.com/gb/app/ig-trading-spread-betting/id406492428 LinkedIn: https://www.linkedin.com/company/igcom Google +: https://plus.google.com/u/0/108999047065291192896 IG is a global leader […]
Dr Jim Phillips, CEO of Midatech Pharma, talks about the impact of the Brexit vote on the European supply chain and tackles regulation, funding, weaker sterling and a potential lower corporation tax environment. Jim also elaborates on the opportune time to decide to move domicile. Read more about Midatech Pharma: http://www.ig.com/uk/ig-shares/midatech-pharma-plc?CHID=9?QPID=1414138385&QPPID=1 Website: http://www.ig.com/uk?CHID=9&SM=YT Twitter: https://twitter.com/IGcom […]
Ben van Bilderbeek,CEO of Plexus Holdings, talks about the company’s current standing in the market as oil field well-head specialists. Having just partnered with Gusar & Konar in Russia, Ben says the company is set to take a share of the demand for high-pressure technology in Russia. Read more about Plexus: http://www.ig.com/uk/ig-shares/plexus-holdings-plc-POS-UK?CHID=9?QPID=1414138385&QPPID=1 Website: http://www.ig.com/uk?CHID=9&SM=YT Twitter: […]
12 July 2016: Richard Hunter, from Wilson King Investment Mgt, explains why there is the disparity in the FTSE 100 and the 250 index and says that to some degree the UK has been ‘picked on’. Richard says the frailties of the EU may soon be exposed. Related Posts:Technical Analysis – NZDUSD bulls show up […]
5 July 2016: How to trade Tesla stock. IG technical analyst, Joshua Mahony looks at the Tesla chart after the company released news late on Independence Day that shows sales have now fallen for two consecutive quarters. Related Posts:Analysis of GBP/USD. April 15th. Retail sales in the USA… April 15, 2024 The wave analysis for […]
5 July 2016: Scott McGregor, CEO of redT energy discusses its business model and highlights target markets. Scott says redT is at the forefront of the development and has started selling into an area that he says will be worth in excess of $100 billion a year. Related Posts:Video market update for April 15, 2024 […]
Aminex CEO, Jay Bhattacherjee, says their efforts in the Kiliwani North well have proved up to the equivalent of 5,000 barrels of oil per day. Jay discusses his thoughts for the Tanzanian government regarding rates and release times of these rates for their production of oil. Read more about Aminex: http://www.ig.com/uk/ig-shares/aminex-plc-AEX-UK?CHID=9?QPID=1414138385&QPPID=1 Website: http://www.ig.com/uk?CHID=9&SM=YT Twitter: https://twitter.com/IGcom […]
When Brazil was awarded the Olympics in 2009, the economy was growing, unemployment and poverty was falling and the government was stable. As the games are about to start, things are now very different. Can Brazil afford it? Website: http://www.ig.com/uk?CHID=9&SM=YT Twitter: https://twitter.com/IGcom Facebook: https://www.facebook.com/IGcom Google Play: https://play.google.com/store/apps/details?id=com.iggroup.android.cfd&hl=en_GB iTunes: https://itunes.apple.com/gb/app/ig-trading-spread-betting/id406492428 LinkedIn: https://www.linkedin.com/company/igcom Google +: https://plus.google.com/u/0/108999047065291192896 IG […]
1 July 2016: Christopher Tinker, founding partner at Libra Investment Services, looks at UK banks and the likelihood that, as a group, the major players will remain in London, post the EU referendum. With MIFID rules overruling EU financial regulation, passporting is also possible Related Posts:Banks Q1 earnings: Weak results despite stock outperformance… April 10, […]
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1 July 2016: Chris Gilbert, CEO of Fox Marble, discusses the growing order pipeline and the impending factory launch. Chris also says that despite the UK’s move away from the EU, the company’s trading entity in Kosovo enables easy access to Europe. Related Posts:Video market update for April 11, 2024 April 11, 2024 Potential for […]
27 June 2016: Peter Kear, IS Solutions CEO, tells IG he sees no material interruptions to the business model because of the UK’s vote to leave the EU. IS Solutions just reported a 187% increase in pre-tax profits with a 257% rise in dividends. Related Posts:Change in market sentiment raises risk appetite and… November 6, […]
16 June 2016: Survation’s CEO Damian Lyons Lowe discusses the swing to the ‘leave’ camp and highlights the surprising move to ‘Brexit’ for the 18-34 year old age group. Related Posts:Outlook for GBP/USD on April 12. The pound once again failed… April 12, 2024 Analysis of GBP/USD 5M GBP/USD made another attempt to settle…EUR/USD: Weak […]
For over a hundred years, it’s been theorised that author L. Frank Baum wrote his 1900 book, “The Wonderful Wizard of Oz”, as a fanciful way to explain the economic situation at the time and that the Yellow Brick Road was a reference to the path created by gold ownership. Whether or not the theory is correct, for many people today, “Follow the Yellow Brick Road” might serve as a mantra for alleviating economic woes.
What will happen is that one day, gold will suddenly be up $100 per ounce, then the next day, $200 per ounce. At first the pundits will be claiming that it’s an anomaly, but as it continues rising, a point will be reached when the average person says to himself, “This seems to be a trend. I’d better buy some gold.”
Unfortunately, once the trend is underway, the price that day will have no bearing on whether gold is available. Your local coin shop may be sold out. If you go online, the mints may say that demand is exceeding supply. Large entities will be buying all they can get and the smaller buyers will be way down on the order list, unlikely to take delivery of even a single ounce.
Gold has experienced a four year bear market and only recently has begun to rise again. But is it in reality a barbarous relic? Not by a long shot. For over 5,000 years, whenever people have experienced erratic economic periods, they’ve bought gold in order to stabilise their economic position. This has particularly been true whenever fiat currencies have been on the rise and were in danger of hyper-inflating, as in recent years. Most currencies are in decline against the U.S. dollar—a currency which, itself, is very much in danger of collapse in the not-too-distant future.
In the ’70s, I was buying gold in London, as it rose from $35. It reached a high of $850 in January, 1980, then crashed. When gold dropped below $400, I began buying Krugerrands. Sounds like a bargain, and yet, word on the street was that gold was headed further south. But I was buying long. I was not playing the market; I was building my economic insurance policy. I wasn’t too fussed over price fluctuations, as my gold holdings were meant to cover me if my other investments proved to be a mistake.
At present, gold is well above the high of 1989, but, if we adjust for inflation, we see that gold is actually a bargain at present. This excellent Casey Research chart from 2014 explains it better than mere words:
This tells us that $8,800 would not be an unreasonable level for gold today, if conditions were as dire as they were in 1980. However, conditions are far more dire—debt levels are far beyond any historical levels and markets are in a bubble, just waiting for the arrival of a pin.
A decade ago, when gold topped $700, I predicted $1,500 at some point and even my closest colleagues wondered what I’d been smoking. But it turned out that my prediction was, if anything, conservative. Over the last four years, some of the world’s most informed prognosticators—Eric Sprott, Peter Schiff, Jim Rickards, and Jim Sinclair—have all predicted gold to rise to between $5,000 and $7,000, and some have suggested numbers as high as $50,000. But this hasn’t happened. Are they wrong? No, it just hasn’t happened as of yet.
Conversely, Harry Dent has predicted a drop to $750. So, who’s right? Well, actually, they may all be right. After a crash in the markets, deflation is a certainty, as brokers and investors dump investments of every type in order to cover margin losses. This panic sell off will most assuredly include gold, even though the holders will not wish to sell their gold. This panic promises to create an immediate and possibly very dramatic downward spike in gold.
However, large numbers of long term investors already have their orders in for any price below $1,000. If the spike drops below that number, it will therefore be brief, as every ounce that hits the market at $999 is scooped up. In addition, the Federal Reserve will make good on its decades-long promise to roll the printing presses to counter any sudden deflation. That very act will light the fuse on the gold rocket and send it skyward.
The argument over whether gold will drop to $750 or rise to $5,000 is a pointless one. Any understanding of basic economics assures us that we shall see both sudden deflation and dramatic inflation. It’s as natural and inevitable as sunrise and sunset. (By the way, several of the above individuals have standing bets with each other as to the $750 number. The prize? An ounce of gold.)
But it matters little who will win the bets. What matters is the overview. Rickety economic times are now upon us and they will soon morph into crisis times. In such times, precious metals always return to centre stage, as paper currencies and electronic currencies return to their intrinsic worth of zero. Gold does not so much rise against fiat currencies, as fiat currencies collapse against gold.
Most assuredly, we shall see a dramatic rise in gold, but, just as in the ‘70s, the average person will fail to understand why and will simply chase the upward trend. When gold hits $2,000, but no one is willing to sell for under, say, $2,500, those who are chasing the trend will pay the $2,500 and that will become the new price across the board. Then it will leap higher—again and again, as monetary panic grips the investment world. The inflation-adjusted 1980 price of $8,800 should not be a surprise at all—in fact it would be low, as, in the coming years, conditions will be far more dire than in 1980. Gold may well blow through $10,000. Even the $50,000 figure is not impossible, as we shall be seeing a runaway bull market where those chasing the trend carry gold beyond any rational value.
But gold has an intrinsic value. 2,000 years ago, an ounce of gold could buy you a good suit of clothes. That’s still true today. A gold mania will fuel the gold price beyond anything logical, but a correction will be equally inevitable, dropping it to its intrinsic value. We shall see a gold rise for the record books. The wise investor should already have stocked up his supply of physical gold and gotten rid of gold ETFs. He should already have his seat belt fastened and ready for take off. We’re off to see the wizard.
Editor’s Note: Owning gold is the first step to protecting your wealth from stock market crashes, currency collapses or destructive government policies. But there are many other steps you can take to protect yourself during an economic collapse. We put together a free video to show you exactly how.
Click here to watch this video now.
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Learn how to trade or invest in gold. Get to know more about 4 different concepts involved in investing and trading this commodity: spot trading, physical gold bullions, gold ETFs and gold stocks. Learn more about trading gold: http://www.ig.com/uk/ig-commodities/gold?CHID=9?QPID=1414138384&QPPID=1 Website: http://www.ig.com/uk?CHID=9&SM=YT Twitter: https://twitter.com/IGcom Facebook: https://www.facebook.com/IGcom Google play: https://play.google.com/store/apps/details?id=com.iggroup.android.cfd&hl=en_GB LinkedIn: https://www.linkedin.com/company/igcom Google +: https://plus.google.com/u/0/b/108999047065291192896/108999047065291192896 iTunes: https://itunes.apple.com/gb/app/ig-trading-spread-betting/id406492428?mt=8 […]
9 June 2016: Dr Tom Becker, CEO of Iofina, says the restructuring of the company’s debt and the $10 million injection will enable it to build a future based on what the company believes will be a rise in the price of iodine. Related Posts:Technical Analysis – AUDUSD clears key barrier but another… November 6, […]
Nick Parsons from National Australia Bank says if UK votes for a Brexit, GBP will sell-off, but quickly ‘snap-back’. Nick says, though, that EUR/USD will plummet to parity and stay there because of the existential threat to the euro. Related Posts:The euro hardly has a chance to rise April 16, 2024 For over six months, […]
31 May 2016: Having suffered from a downturn in its share price over the last year, Newmark Security CEO Marie-Claire Dwek talks about shareholder benefit in 2017-18 from its new products. In the interim the progressive dividend strategy ‘remains’.
27 May 2016: Stride Gaming saw a big rise in revenues and profits in the first half and CEO Eitan Boyd tells IG that the second half has started well. The company is now aiming to enter the lottery and scratch card market to boost profits. Related Posts:Technical Analysis – Goldman Sachs stock gains on […]
26 May 2016: Charlie Morris, Fleet Street Letter Editor and Newscape Fund Manager, tells IG that ‘value‘ is back. He discusses the sectors he likes, emphasising the banks. Related Posts:Gold Still Expected to Rise on Wall Street and Main Street April 15, 2024 Since geopolitical risks continue to push precious metal prices into…Energy in Focus: […]
23 May 2016: Harlequins CEO David Ellis discusses the club’s mini-bond offering. He says the money raised will be put towards ‘building new audiences at home and abroad’ and that the club has never been ‘stronger on or off the field’. Related Posts:Financial future on the horizon: US stocks rise ahead of… April 10, 2024 […]
20 May 2016: SDX Energy, which produces crude in Egypt, has listed in London in a £7.6 million IPO. CEO Paul Welch tells IG that, at $40 a barrel, SDX makes $15. This means that any potential increase in the oil price equates to higher profits. Related Posts:The dollar has not reached its potential April […]
19 May 2016: Tim Allen, blur Group CFO , says after the ‘transformational year’ of 2015, where the enterprise platform cut costs and refocussed the business, the strategy is now to target larger clients at the expense of smaller, low volume business. Related Posts:Market Comment – Dollar and equities trade higher in… April 10, 2024 […]
