- Stansberry Research: The gold-silver ratio is an important historical indicator
- Kitco: Silver's crazy days
- Kitco: Is now a good time to buy gold?
Stansberry Research: The gold-silver ratio is an important historical indicator
Daniela Cambone interviews Vince Lancia of Echo Bay Partners about the current state of silver, his forecasts, and the gold-silver ratio. Vince believes that silver is a target for a short squeeze movement - or at least enough people believe this and act accordingly. The squeeze is not yet reflected in the price of silver, but it is evident in the market movements: currently, the value of gold is falling while silver is rising. Lancia believes that if gold starts to rise, silver will also take off on an upward trajectory.Daniela asks if the decline in gold is due to a relatively strong dollar and positive economic data from the United States. Lancia thinks they affect the situation, but the real reason is tactical: gold selling began with the Chinese New Year.
Finally, Lancia responds to a listener question about the gold-silver ratio. He believes that the ratio is important from a commercial and historical perspective, but it does not accurately reflect the true value of the metals. The ratio was created in the 19th century when the bimetallic movement wanted to tie the value of one unit of silver to 16 units of gold. And although the ratio no longer reflects the true value of either metal, it is useful in trading gold and silver securities.
See full video in English / February 22, 2021, Daniela Cambone
Kitco: Silver's crazy days
Hubert Moolman, a private gold and silver analyst, predicts in his Kitco commentary that something big is about to happen for silver. Moolman compares the current period for silver to previous fractal analyses and forecasts that the metal's value will either sharply increase or decrease soon - with a strong probability leaning towards growth.The value of silver collapsed in March 2020, and its price development has followed last year's events since last August. However, this time it is more likely that the price will increase instead of collapsing. This prediction is based on how the silver price curve and the Dow index have tracked each other since 2019. According to Moolman, silver performs well when the Dow drops or remains stagnant, and he believes a Dow collapse will send silver soaring.
Significant movements are likely to occur in the next couple of weeks. It remains to be seen whether silver will reclaim the top spot of 2021.
Read full article in English / February 26, 2021, Hubert Moolman
Kitco: Is now a good time to buy gold?
Although the increased yield of bonds and higher interest rates have been tough on gold, Kitco writer Richard Mills encourages buying gold and gold juniors. In his comprehensive article, he explains why he expects a bull market for gold.The yield on bonds has risen due to U.S. stimulus measures and the economic growth optimism they have sparked. However, corporate investments are believed to grow twice as fast compared to the rest of the economy, raising concerns about inflation. The U.S. Federal Reserve should manage inflation by raising interest rates, but the bank is unlikely to stifle the modest growth that has already occurred.
At the same time, the Biden administration is starting to spend like crazy: the U.S. deficit is projected to grow to $2.6 trillion in 2021, and this figure does not even include the $1.9 trillion stimulus plan, which is the largest investment in infrastructure since Roosevelt's New Deal. In addition to repairing the damage caused by the coronavirus with state investments, President Biden is also committed to reducing greenhouse gas emissions and providing financial support to developing countries.
All this spending is debt-financed, and the stimulus has pushed the U.S. national debt close to $30 trillion. This, combined with loose monetary policy, keeps interest rates near zero. The government is engaging in both quantitative and economic stimulus at the same time. This leads to inflation: the dollar is weaker than nearly all major currencies, and the value of several commodities has risen. High commodity prices also lead to rising prices for processed goods, which often fall on the consumer. We are already seeing signs of inflation, even if they are not yet reflected in official statistics. Therefore, many believe that the overvalued stock market bubble will burst very soon.
Gold is a traditional hedge against inflation
The change is first seen in base metals, which are facing years of deficits due to declining mining output and the growing demand from the green energy industry. Precious metals, particularly gold and silver, will soon follow: gold is traditionally seen as a hedge against inflation, and the central bank has already announced it will allow for a higher-than-usual inflation rate. The atmosphere of high consumption created by the U.S. administration benefits gold. And silver follows in gold's footsteps - and because silver has both intrinsic and industrial value, it may even outperform gold in 2021.In summary, gold, silver, and their juniors are now available at low prices, even as all other stocks are overvalued. Copper, zinc, and other common metals will be the first to move as government infrastructure projects employ people and repair the damage caused by the pandemic. And as consumption grows recklessly, debt accumulates, and inflation rises, smart money flows into gold and silver.
Read full article in English / March 1, 2021, Richard Mills
