8:58 PM
admin
As many of you know, on September 21st, I released my latest predictions on where I expected precious metals to go from here. My outlook was derived from an extensive amount of analysis, and that outlook was decidedly bullish.
In that blog, entitled Where Gold, Silver, Platinum Go From Here, I gave my expectations for $3,200 gold, $125 silver, and $5,800 platinum, all significantly higher than where they are at right now.
So, what’s happened in the two days since I released that blog? Gold has sunk 5% (or $100 per ounce), with silver’s collapse even more pronounced, falling about 20%.
With a lot of panic on the markets, many people have asked me about selling out of their precious metals, shell shocked by the sudden rollercoaster drops. Well, our outlook in the face of this brief mini-panic remains unchanged. Some may even consider this the buying opportunity of a lifetime.
Consider that the stock market was sharply lower, across the board. Equities, commodities, and most currencies have been getting absolutely hammered the last two days.
Selling was not centered around precious metals alone, and this is a very telling point. If only precious metals were being sold off, then that would represent a very bearish sign. However, it was just a complete exit from all types of investments, with gold and silver declines representing collateral damage.
For example, as stocks fall, many investors find themselves getting margin calls to cover their losses, so they often look to unload their precious metals to cover the costs of their falling equities.
In the flight from investments, much of that money sought out a new home that was considered to be low risk, whether it be the US dollar, or government bonds. This is both ironic and misguided, as the masses will figure out in the coming week as the smoke clears.
Only precious metals, and the companies that produce them (with long reserve lives, little forward hedging, competitive costs of production, and proven reserves) will represent a true safe haven. We are about to enter what will be the most widespread and active currency debasement the world has ever seen.
Best wishes,
source: forbes.com
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