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Red Lee, I think you are right in that sell risky assets mentality. I do remember that during 2009 when both gold and silver took a hit along with the miners. Trouble back then was banks didn't trust each other. So even if your business is sound, you find credit hard to come by and therefore lots of companies had to default. It is very different this time all though the mentality would be sit on cash and see how it plays out for the coming weeks. I hardly blame them. I would do the same but the timing is really bad as we would have really good news in a few days and I want to make some money from that. Fingers crossed things stabilise.
Hi Red - well, everything's currently up in the air right now, as we all know but thanks for the link to Lobo's commentary on the present hiatus; he sums up matters quite well, I'd say...
Physical gold is the obvious 'port in the storm' to go for in such conditions but it's relatively inflexible most of the time (unless the bullion's held by an agency for you which involves 'third party' risk and thus nullifies the 'independence' of it) hence my preference for quality miners where some income is also generated - quite useful in this yield starved environment today, too.
The Instos will favour the likes of POLY (being the only one in the FTSE 100 right now) and when the QE programmes get going again shortly, they're likely to step up their involvement accordingly.
As for the COMEX shenanigans, this has been going on for yonks, as you know. Many legal hearings have come and gone regarding such manipulation and with the FED (owned by the top six US banks, of course) keen to avoid embarrassing their currency too much, I guess it'll continue until finally 'the game's up' but only when it's prohibited by law.
Generally hunkered down currently, although still quietly adding to our 'wannabe' PUR - today's price seems especially tempting, I must say! ATB - sasa.
Sasa, absolutely, Mate. It'll be an event like that, that breaks the COMEX, & prices for physical PMs will de-couple drastically from paper prices.
We can hope...
Those buyers of the gold contracts you mention, BTB, should demand physical delivery of the gold when expiry nears, rather than trade them out as they usually do.
That risk would soon put a stop to the constant manipulation of the AU and AG mkts - sasa.
I suspect that FRES and Hoc are falling not because the industry will require less silver due to the CV (espcailly since silver is soooo low atm) , because the MM know PM will be moving up so anything to scare people to sell on the dip and then suddenly move the price up by 2 to 3% by a low vol buys and sells and panic people to sell again to get out on a higher price. I have seen this movement many times with other stocks. Just need to sit and be patient. PM will have their day soon. Pressure is building for a massive explosion upwards.
I think there is the buying the dip mentality whereby while rates are low and Governments are printing money, it will still be positive for equities.... Because that is where cheap money can get highest return. I guess those that want to stay safe buy gold.
I have double down on my spreadbet this morning. I think next week will be good.
Hold your nerve, guys. There is a clear, concerted attack on PM prices which started on Monday afternoon with the dumping of $3B in paper gold contracts. No-one, & I mean NO-ONE is selling physical at this time.
The Dow dumps nearly 2,000 points, there is a global pandemic, the world's biggest economy remains crippled with global supply chains fracturing & yet PMs FALL? Are you ******* ******* me???
Look at where we were on Friday. Hands-up those who think that the markets (& the world generally) are better now than they were at the end of last week.... Exactly: no-one. The REAL economic effects of China's shutdown will start to be felt in the coming weeks. Increasing numbers of companies are warning not only on profits, but on product availability, as Chinese manufacturing shutdowns leave wlth either with no component parts or no product whatsoever. One of these companies is Apple. They don't come much bigger.
The market thinks the Fed will save the day, & yes: they will print, but they can't print vaccines, mend broken supply chains or backfill the production that's already been lost. They're (slowly) starting to recognise this fact.
For years now we have seen the irrational pricing of risk assets. Right now, we are witnessing the irrational clubbing of PM prices. Things that can't go on forever, won't. As I've said before, there are only two ways out of this mess that the global economy is in, & BOTH of them are hugely positive for PMs.
Stand your ground, buy PHYSICAL PMs & GLA.
make a quick buck for a kebab or make 50% and be safe for now, I know what I would pick. Poor HOC too a beating today. I am sure by Friday all of these will be back up...
Expects the Fed to cut rates to help a pick up World Growth. I see this as a further help for precious metals prices and will help us too!!!