Feb 28th 2013
“Investors who understand the long-term inflationary cycle should diversify across the metals” “There have been trillions of dollars pumped into the financial system,” Jeb Handwerger tells The Gold Report. Investors who understand the long-term inflationary cycle should diversify across the metals, but now is a good time to be overweight in the precious metals that have an industrial component, such as platinum. …
We have just lived through a long and painful downside. The reversal, when it comes, will be powerful. There have been trillions of dollars pumped into the financial system by central banks worldwide. This may be unleashing long-term inflationary forces. This challenge could be with us not only over the next couple of years, but possibly into the next generation, perhaps with gut-wrenching price increases.
This is why I maintain a long-term position of diversification across the precious metals, uranium and strategic metals. Short to medium term, we’re in a consolidation phase. Eventually, the capital will flow to the quality, which are the cheap commodities and undervalued miners. It’s important to be patient in these sectors and to realize that these may be excellent discount buying opportunities.
“No one will deny that historically gold has been one of your best hedges on inflation” Point View Wealth exec sees “upward pressure on gold” “Gold is very difficult to value — there’s no price-to-earnings ratio; there’s no dividend,” Point View Wealth Management President David Dietze tells CNBC in a Feb. 26 interview.
“But what do we know? We know it’s down almost 20% from where it was just 18 months ago. We also know that with $16.5 trillion of debt on the U.S. Treasury’s balance sheet, with central banks around the world cranking up that printing press, no one will deny that inflation over the next five to 10 years is a large risk, and no one will deny that historically gold has been one of your best hedges on inflation. So whether it’s now or whether it’s a couple months from now, we see upward pressure on gold.”
Silver Shorts Feeling Squeezed? “I hope so! Last week’s free fall in the silver market might have created the final window of opportunity to buy for a major buy-and-hold strategy for the long term. The fact that the market broke the January 4 and December 20, 2012 lows does not constitute a major top in the market. It is simply a test to lower levels of support and a huge opportunity to accumulate at these levels for the long term.
The $28 to $28.50 price level serves as a maximum extension for this correction using Gann Trend lines. It confirms a major level of support based on the downtrend line support extension starting from the November/December 2012 lows, and connecting the January 2013 low measures almost to the dime.
Buying And Owning Silver – Arguments For Silver Ownership – Given that industrial demand for silver is growing rapidly, and given that above ground silver inventories are largely unknown, a much lower gold/silver ratio is within the realm of possibility.
Thus, while silver is not a stable asset to the extent that gold is, it should constitute a significant amount of any portfolio along with gold. Silver is conventionally viewed as a “riskier” asset than gold. However given that silver represents better value than gold, I would argue to the contrary.
The perceived added risk in silver relative to gold is due to the fact that the price of silver is generally more volatile than the price of gold. Therefore I would recommend that investors who are averse to volatility favor gold in their portfolios, whereas investors who can stomach volatility favor silver.
OUCH! US Mint Increases Gold, Silver, and Platinum Product Prices as Precious Metals Fall – The first increases were announced in late December through a publication in the Federal Register, which included prices for various 2013 numismatic products.
Prices for 21 products had remained unchanged, while the prices for three silver products were increased compared to the prior year. Specifically, the price for the America the Beautiful Five Ounce Silver Coins was increased by $15.00 to $244.95, the Proof Silver Eagle was increased by $3.00 to $62.95, and the Uncirculated Silver Eagle was increased by $3.00 to $53.95.