While a myriad of forces pushed the gold price around in 2018, it basically ended the year flat. This report recaps the year in gold, shows how it compared to other asset classes in both short and long timeframes, and explores the factors to watch in 2019.
I read a mainstream report about a decline in gold imports into Hong Kong, with the journalist concluding that gold demand in China is therefore down.
Liberal economist Paul Krugman proclaimed earlier this year that “gold is dead.” An Economist article stated that “there is no point in investing in gold, any financial investment is better.” And Warren Buffett, one of the most successful investors of modern times, has never liked gold.
The continual drubbing of the silver price has pushed a number of the metal’s valuation metrics to extreme levels. As you’ll see, conditions have gotten so overdone to the downside that a simple return to historical norms would result in a substantial rise in price; in the past, betting on silver under similar conditions as we find now has proven as powerful and predictable as the tide coming in.
I’ve been watching this metric all year. And when gold and silver took their recent tumble I checked it again.
I found what I thought I would. Gold and silver prices, adjusted for inflation from a more accurate measure than the CPI, are now cheaper than when they became legal to own again in the United States.
If you want or need to add more bullion, right now offers the best opportunity in 10 years to do so on the cheap. Both metals prices and purchase premiums are on the deep discount rack. We rarely get both at the same time…
Mike Maloney thinks that hyperinflation is a distinct possibility in the US. So when I read about the runaway inflation rates in Venezuela, I wondered how that would play out in the US if he’s right.
Mike Maloney mentioned an economist he was studying as part of his research for a new book, so I ordered one of his books.The core message in this economist’s book pulls no punches: There is no escaping another debt-related crisis. And while he doesn’t specifically state the crisis will be worse than the Great Depression, the data he shares and conclusions he draws make that clear.
Real estate prices look to be topping out. Gold and silver prices are back at 2010 levels. As the relative pricing of these two assets reverses over the coming years, it will afford those with a meaningful holding of precious metals the opportunity to buy a house outright.
Have you ever looked at a chart of an investment and wished you’d bought when it was cheap, before it rose by multiples in price? We all have. But to do that requires we buy when the investment is out of favor, in direct contrast to the prevailing sentiment at the time.
That’s precisely what contrarian investors do.