Gold report authors claim gold is back in a bull market
The tenth ‘In Gold we Trust’ report, written by Ronald-Peter Stöferle and Mark Valek, and published on 28 June, 2016 claims that gold is back with a new bull market emerging.
The report also found increasing uncertainty about economic and political developments has boosted the gold price and that with ongoing monetary stimulus, the BoJ and the ECB are creating the equivalent amount of the world's entire annual gold production via their QE programs each month.
BREXIT has caused uncertainty which will negatively affect growth, and the report finds that further monetary and fiscal stimulus is to be expected to counter further disintegration of the EU.
A major contributor to gold/commodity weakness of the last few years has been the strength of the dollar, the report finds. “The narrative of economic recovery is crumbling; US recession cannot be ruled out; faith in monetary policy measures declines,” the authors write, predicting that continued depreciation of the US dollar and strength in commodities may lead to higher inflation, or maybe stagflation.
The persisting low interest rate environment is leading to a revival in interest in gold investments on the part of institutional investors, the authors find, and say that in addition to gold, this generally means a positive environment for inflation-sensitive assets like silver and mining stocks.
Well said Tester, its been a difficult stressful ride here, I wish it comes to an end, mind you I have added an additional 30k to this holding Risking it all, as stupid as it sounds I do believe in CNR, but am puzzled sometimes... I just hope for all our sake that this EIA gets approved.
I noted your frustration last week with the increase in the price of gold and the lack of any corresponding movement in the CNR sp.
I do understand why that frustrates you but I just wanted to talk you through why I feel that now is actually an ideal time to BUY CNR while we go through this "lag" period..
Your frustrations are mainly being caused by the fact that you bought the majority of your CNR holding at the top of the last cycle. But you have done the right thing and waited patiently for the next cycle to show up without selling yet.. I believe that we are now on the cusp of that next cycle and that this cycle could be the biggest "top" the gold mining world has seen to date...
1) We spoke at the tail end of last year about how important sentiment was to the market. At that point sentiment towards gold was at a 5 year low, and indeed we saw this in CNR with CFI liquidating their holdings at around 18-20p. Since then sentiment has returned to gold and the gold price has increased $300 and our SP has trebled.
2) Since that time that sentiment returned to the gold market, you have also seen a huge increase i.e 200% in the SP of producing miners like Randgold, Barrick etc, as they start reaping the rewards of a) higher gold price and b) lower AISC costs as they reduced these when gold prices fell below their previous average AISC's which meant it was costing them to produce gold!
3) This cycle (which has happened many times in the industry - ask Ross Beaty ;-) will now turn towards junior explorers with a mature deposit - i.e PEA completed, BFS studies done, Whittle studies completed (still a rarity for a junior) and most importantly with an EIA signed. This is because the majors like Randgold, Barrick will start to either spend their cash pile to replace their diminishing resources, or use the newfound strength in their SP (see 2) to start a period of M+A through takeovers of these juniors with either cash or shares.
4) The SP of Junior explorers with these characteristics, along with large resource/proven reserve with high grades and low AISC costs will rise as speculation mounts about their possible sale values etc. This may also combine with a global financial crisis which many (inc Alan Greenspan, Lord Mervyn King) now think is on the cards. BREXIT may be blamed as the pin that burst the vastly overstretched bubble or it could be another future trigger - watch derivatives at Deutsche Bank for example. This event would generate a stratospheric rise in the PoG as the ultimate safe haven when banks and even sovereign countries (possibly the collapse of the EU too) start to fail (see Brazil, Venezuela, Puerto Rico, Italy, Greece etc) the likes of which the world has never seen before (forget $2k gold as in 2011/12, this is much worse, or better if you own gold/gold shares). Combine the two events and you have a super top in the price of junior gold shares that could well surpass our thoughts of £2 a share here by a very large margin. MC once stated that he thought £8 a share was possible..
In short, I will keep holding my CNR shares until this event is finally realised. My only worries being 1) EIA gets denied / rejected 2) The global financial crisis is so bad that my broker goes bust as well! In my eyes we are between stages 2 and 3 in this cycle now..
Patience is a virtue, Possess it if you can, Rarely found in women, never in a man! ;-)
quite the contrary, if you are blatantly committing electoral fraud, do you really want to **** off people any more than you already have? Your thinking like condor shareholders, not like someone who is trying to rig an election and do it with as little fuss as possible. Ortega is treading on very thin ice and does not want to wind people up more than he already has! Last week saw the expulsion of 3 US government officials and this week several foreign nationals who were helping the indigenous communities organise themselves against the proposed canal project.
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