Gold typically enjoys the lion’s share of the attention when a precious metals bull market is looming. But as we’ve said before, when climates favorable for metals set in, it is often silver that proves to be the better performer. During the latest positive economic turn for metals, silver’s potential again is being viewed with great optimism. The senior commodity strategist at Bloomberg Intelligence recently went as far as to suggest silver’s “greater negative correlation to the dollar” could prompt the white metal to double in price from its present level. His analysis of silver potential begins our roundup of this week’s key news items.
- Did you happen to see the August Commodity Outlook from Bloomberg Intelligence? If not, you missed Bloomberg Intelligence senior commodity strategist Mike McGlone singing the praises of silver. Referring to a potential breakout in the price of silver similar to the one committed recently by gold, McGlone writes, “On the cusp of closing above key resistance, upside potential in the silver price has rarely been more extreme. Near the end of July, silver appears it will stay above its 50-month average for the first time in six years.” Silver now hovers around the $17-an-ounce mark, already 15% higher than it was a scant two months ago and is poised to climb further during the current economic upheaval.
- In a recent piece for the network’s flagship website, CNBC personality and former hedge fund manager Ron Insana writes that while the media remains focused on volatility in financial markets, it’s the rapid decline in interest rates worldwide that should have everyone’s attention. In fact, says Insana, rapidly descending interest rates will send us “hurtling … toward an economic abyss.” He is particularly concerned that China and the U.S. will fight a currency war every bit as contentious as the broader trade war is proving to be. He notes ominously that “a race to the bottom of foreign exchange values is just the type of policy, coupled with trade protectionism, that helped turn a deep recession in the late 1920s into The Great Depression of the 1930s.”
- Gold’s been on a tear since the Federal Reserve’s June 19 announcement suggesting rate cuts were imminent. It topped $1,500 this past week for the first time since 2013, but experts believe the metal still has plenty of room to run. A recent article in the Regina Leader-Post says gold remains “one of the chief beneficiaries of the turmoil in global financial markets” that seems to get worse by the day thanks to the mammoth and protracted trade disagreement between the U.S. and China. Wayne Gordon, the executive director for commodities and foreign exchange at UBS Group AG’s wealth management unit, says matter-of-factly that “gold is serving its traditional role as a safe-haven asset” and that UBS sees gold reaching $1,600 an ounce next.
- Not only does a trade deal between the U.S. and China remain elusive, but conditions have deteriorated to the point where it can be said the countries are now engaged in an all-out pitched battle over trade. Observers are growing more concerned by the day. Former Treasury Secretary Lawrence Summers recently went so far as to say that we are now living in “the most dangerous financial moment” since last decade’s global recession. For more on just how worried experts are about near-term economic conditions, and why some of those same experts say gold will thrive magnificently on the back of the turmoil, read Augusta’s latest blog article here.
The long-awaited return of the precious metals bull market already may be upon us. In just a couple of months, silver and gold have jumped 15% and 13%, respectively, and the unfortunate economic conditions that have served to fuel precious metals’ recent rise are expected to only get worse. If you’ve been considering the addition of physical precious metals to your portfolio, keep in mind it’s difficult to imagine a scenario more positive for metals than the one playing out right now. If you’re ready to talk about silver and gold – or already know you want to take advantage of silver’s latest show of potential – we’re ready to listen. Call Augusta Precious Metals at 800-700-1008 or visit Augustapreciousmetals.com.