The success of any fiat currency or real money substitute (in other words, anything other than gold itself as the medium of exchange) depends on its convertibility into gold on demand.
Now Moody’s is in a bad mood, downgrading a swath of 10 US minor-league banks overnight while also issuing a big threat that it may downgrade some of the majors.
If the ten-year yield is capped at around 4.33% again, and it likely will be, Oct 31 Halloween candy handouts could include some very sweet $2080 gold!
The gold price denominated in fiat currencies substantially increases in the long run, creating hefty unrealized gains when metal is held for an extended period.
If the S&P has put in its high for this year (4607), as it continues to tumble, shall Gold so ride astride, or ideally move up against the tide? We think broadly the latter.
Junior gold stocks offer incredible upside potential during gold bull markets. Anecdotally, during a bull market, senior gold miners typically outperform the metal by a multiple of 2 to 3 times.
I hear deep concern we are headed for a period of social and perhaps even kinetic conflict. The extreme partisanship, not just in the US but around the world, seems to be pointing to just such a crisis.
Government jobs data gets revised every month: putting out higher numbers to hit the headlines, then revising them down later allows the Biden admin to gaslight Americans.
The stock market is loaded for failure. A post-bubble real estate contraction can last 20 years. Following a market-wide pullback, come the next buying opportunity, gold stocks will outperform the S&P.
