Posted on 05/27/2021 8:45:21 AM PDT by blam
Over the last several months, gold and silver have faced strong tailwinds due to market expectations that the Fed would tighten monetary policy sooner rather than later to fight price inflation.
But after April’s hotter than expected CPI, that sentiment seems to have shifted and the markets are acting the way you would expect in an inflationary environment.
Gold and silver have rallied and the dollar has shown weakness. In fact, gold pushed above the $1,900 an ounce level.
In this Gold Videocast, Peter Schiff explains why he thinks this is just the lull before the real storm and now is the time to buy gold and silver.
It’s been a long hard grind to get gold back to $1,900 an ounce. A lot of investors have been frustrated that the yellow metal hasn’t made a bigger move faster. Peter said he thinks those days of frustration will soon come to an end.
I think vindication is around the corner because I think a major move up in both the price of gold and silver is imminent. And in fact, to the extent that people still have cash on the sideline that they are yet to commit to the market, I would not wait. I would suggest that everybody have a full position. So, whatever you feel your allocation is going to be to physical gold and silver, my suggestion is that you fully allocate now. Don’t wait for lower prices because you’re probably going to be waiting indefinitely. I doubt they are going to get much lower. In fact, I expect them to get much higher.”
Peter said he also thinks the premiums on bars and coins will go much higher as demand spikes. In fact, we have already seen shortages of some products. The US Mint had to ration sales of American Silver Eagles earlier this year. So the sooner you buy, the cheaper you will be able to get your gold and silver.
But why hasn’t gold seen a bigger rally with the increasingly high levels of inflation?
The investment community kept expecting the Fed to pivot and tighten monetary policy sooner rather than later to fight it. They were looking for interest rate increases and quantitative easing tapering. This created headwinds for both gold and silver. Meanwhile, the central bankers at the Fed keep telling everybody that inflation is “transitory” and nothing to worry about. Peter said he’s seen this song and dance before.
It is eerily familiar to what the Federal Reserve did back in 2007 when facing the subprime mortgage crisis.”
Peter reiterated that he thinks the central bankers are wrong to think price inflation won’t become a big problem, just like they were wrong in the days leading up to the 2008 financial crisis when they insisted subprime mortgages weren’t a problem.
(snip)
One reason silver is so high is spot is 9.99 an ounce. (premium). I went to buy at Ampex and decided to wait. It’s gone up 1.50 since then.f
Sorry. APMEX
Gold is a good hedge when someone can actually predict a crash. Most of the time it is a poor investment.
I dunno - maybe I should stop muting William Devane’s commercials...
We’ve been watching G&S too. In our safe. Sooner or later it was bound to pay off. 😉
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