Author Archive: GoldSilverWorlds

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Markets Completely Decouple from Reality

Markets Completely Decouple from Reality

Investment demand for physical gold and silver is unrelenting. Buying activity actually picked up slightly last week as paper gold and silver prices drifted sideways to lower. Once again, anyone simply watching the gold price on CNBC would be shocked to know just how many people are buying gold. The Fed, and the cabal of Wall Street Banks it represents, are undoubtedly relieved to have metals prices under control. But they have a serious problem and it is bigger than the gold market. The disconnect between virtually all paper asset prices and real-world fundamentals has never been greater. The screen capture below pretty well sums it up: The ponies at […]

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Supply, Demand, and Depreciation: Key Drivers for Metals as the Economy Reopens

Supply, Demand, and Depreciation: Key Drivers for Metals as the Economy Reopens

The metals markets are being pulled in multiple directions simultaneously like never before. The global virus-triggered economic freeze has caused industrial demand for all commodities to crater. At the same time, mining output is also crashing as virus fears force many mines around the world to suspend operations. What is the “right” equilibrium price for copper, silver, gold, and other metals in an environment of such extreme and unstable supply and demand stresses? The verdict of the market changes – often dramatically – day by day. In March, hard assets tumbled along with stocks as investors priced in increasingly dire scenarios for the economy. A double-digit contraction in U.S. GDP and double-digit spike […]

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All of the Economic Recovery Models Will Be Wrong Too

All of the Economic Recovery Models Will Be Wrong Too

“All of the projection models were wrong. All of them,” admitted New York Governor Andrew Cuomo in an interview last week with MSNBC. Governor Cuomo had been issuing frantic demands for tens of thousands of ventilators… that turned out not to be needed as the rate of new hospitalizations for COVID-19 infections in New York plunged with surprising speed. Governor Cuomo had warned America that New York City was the canary in the coal mine, that other cities would soon suffer similar death rates. And based on models cited by Dr. Anthony Fauci just a few days ago, the United States was expected to rack up around 200,000 deaths from […]

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Federal Reserve Notes Are Now “Backed” by Junk Bonds

Federal Reserve Notes Are Now “Backed” by Junk Bonds

Wild price action and unprecedented interventions once again characterized this holiday-shortened trading week. Oil prices whipsawed lower Thursday on concerns about expected oil production cuts from Russia and Saudi Arabia.  But the general trend for most other assets, including metals and equities, was up – way up. Stocks finished out the week with the major averages posting their biggest weekly gains in decades in the space of just four trading days.  Investors went on a buying spree based on hopes that we will soon see a definitive peak in coronavirus cases and begin the process of restarting the economy. The stock market also got another boost from the Federal Reserve.  […]

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All Is Not Well in the Gold Paper Markets

All Is Not Well in the Gold Paper Markets

London Bullion Market Association (LBMA) officials have loudly proclaimed there are plenty of gold bars in LBMA and COMEX vaults to meet surging demand from buyers. Unfortunately for them, confidence is particularly fragile these days and cracks are starting to appear. Which is why anxious officials there issued not one, but two memos last week in an attempt to reassure traders. It’s interesting the LBMA, along with the COMEX, felt a need to put out back to back statements. If inventories are plentiful, both exchanges should be busy delivering gold, on time and without delay. The best way to build confidence is simply to meet buyers’ expectations. The trouble is these expectations […]

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Crisis Exposes Devastating Consequences of Fed Policy: Americans Have No Savings

Crisis Exposes Devastating Consequences of Fed Policy: Americans Have No Savings

Two weeks ago, during a March 17 address to the nation in response to the COVID-19 outbreak, President Donald Trump asked that Americans work from home, postpone unnecessary travel, and limit social gatherings to no more than 10 people. And last week, on March 27, Trump signed a stimulus package of over $2 trillion dollars to provide relief to an economy on the precipice of collapse. The aid package includes handouts and loans to individuals, small businesses, and other distressed industries. Despite Trump’s “having created the greatest Economy in the history of our Country,” when the markets tanked, massive and immediate government intervention was the only thing left to forestall […]

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Gold & Silver Mines Closed as Physical Silver Becomes “Most Undervalued Asset”

Gold & Silver Mines Closed as Physical Silver Becomes “Most Undervalued Asset”

A surge in coronavirus cases, an expansion of economic lockdowns, and an explosion in unemployment claims hit markets this week.  But this deluge of bad news didn’t seem to catch investors by surprise. Instead of crashing to new lows, the stock market held within a trading range and rallied yesterday following the release of a horrific jobs report. It’s been a huge week for commodity markets as oil prices posted their biggest single day percentage gain ever Thursday, popping more than 25%.  Oil prices lifted from their severely depressed $20 per barrel level after President Donald Trump met with oil executives and announced Russia and Saudi Arabia would agree to […]

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How the C-Factor Could Decimate 2020 Global Gold and Silver Production

How the C-Factor Could Decimate 2020 Global Gold and Silver Production

Item: March 16, 2020. A huge poly-metallic (gold, silver, copper) mining operation in Mongolia “has suspended operations” after authorities “restricted the movement of goods and people within the country.” Item: March 17. In Peru, one of the world’s largest primary silver-gold producers has its 4 mines “temporarily suspended” following the Government’s Declared State of Emergency. Item: March 18. A Canadian mining major suspends construction of a $4.7b copper mine upgrade in Chile affecting 15,000 workers. Item: March 20. Argentina declares a state of emergency and imposes “a nationwide mandatory quarantine starting today.” Silver and gold mines across the country move to halt operations, except for “a reduced workforce to ensure appropriate safety, security and […]

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Physical Demand Wreaks Havoc on Futures Exchanges

| March 30, 2020 | Category: Trading
Physical Demand Wreaks Havoc on Futures Exchanges

In recent days, retail demand for physical bullion has tapered only slightly from the frenetic pace of the prior two weeks. Many of Money Metals’ major retail competitors appear to be facing big challenges obtaining enough inventory of coins, bars, and rounds and fulfilling orders timely. To be fair to the struggling dealers, buyers have vastly outnumbered the sellers for weeks, despite the big jump in premiums. By virtue of having its own in-house fulfillment operation combined with strong capitalization and sourcing, Money Metals seems to be well positioned in terms of securing stock and fulfilling orders quickly – and we have not been refusing orders from smaller customers while […]

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Fed President Declares: “No End in Our Ability to Print Money…and Congress Has Told Us To.”

Fed President Declares: “No End in Our Ability to Print Money…and Congress Has Told Us To.”

The roller coaster ride in markets took a sharp turn higher this week after the Federal Reserve and Congress together pledged over 6 trillion dollars to rescue the financial system. Perhaps this week was an inflection point for the mass fear and panic that has cleared out bullion dealers of coins and grocery stores out of toilet paper.  Although the number of coronavirus cases hasn’t yet peaked, there are some signs that the hysteria surrounding the deadly outbreak has. The stock market finally put together a sustained rally even though the economy remains locked down.  But how can equities jump without the impetus of actual earnings from business operations?  The […]

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Amid Gold and Silver Shortages, a Top U.S. Dealer Introduces a Low-Cost Gold and Silver Offering

Eagle, ID – March 26, 2020 — While other precious dealers are sold out of most inventory, Money Metals Exchange, the national online dealer voted “Best in the USA,” today introduced its new Vault Metals program.  This unique initiative would make precious metals available to investors at very low premiums (silver at $1 or less over spot, for example). Here’s what’s happening… Recent days’ intense market demand has quickly soaked up virtually all available worldwide supplies of hold-in-your-hand silver – rounds, coins, and bars. Gold coins, rounds, and bars have become scarce, too, especially for less-prepared or under-capitalized dealers. These shortages mean that even though spot prices may be lower, most […]

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Urgent Questions about Precious Metals during the Coronavirus Crisis

| March 26, 2020 | Articles: General
Urgent Questions about Precious Metals during the Coronavirus Crisis

Article Source: Money Metals Exchange The past few weeks have brought unprecedented volatility to the bullion market. In addition to wild swings in spot prices, Money Metals has experienced a massive surge in demand and extreme strain on supply, leading to a spike in premiums (on both bids and asks). These are stressful times for everyone, to be sure. But precious metals investors can rest assured physical bullion has always, and will continue to, represent real value during turbulent times. Case in point, while virtually all other assets have crashed, gold has stayed firm near its recent highs. Many longtime gold and silver holders – as well as potential new […]

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Short Supply and High Gold/Silver Premiums, But There IS a Solution…

Short Supply and High Gold/Silver Premiums, But There IS a Solution…

A huge spike in demand for physical precious metals has decimated available dealer inventories. The vast majority of gold and silver coins, rounds, and bars are either out of stock or come with extended shipping delays. Premiums are spiking higher. Dealers have raised bid premiums – the amount offered above the spot metal price – dramatically along with ask premiums. The market is still searching for equilibrium and bids dealers pay may need to go even higher to entice enough sellers to meet demand. Demand continues to far outstrip available supply of minted items. The problem is being compounded as mints and refiners close in response to the COVID-19 virus. […]

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Gold Price Relationship to the Economy

| February 25, 2020 | Category: Economy
Gold Price Relationship to the Economy

Too often, you will hear people talk about how the economy affects gold prices and not how gold prices affect the economy. However, whether you are a gold collector, investor, or merely interested in this subject, it is vital to understand why gold prices matter and have a 360-degree image of the precious metals. Whenever there is a crisis in the economy, the prices of gold always seem to benefit. Currently, the Brexit uncertainties are the primary concern, and studies have shown that the prices of gold might surge to $5000 in 2020. The prices of gold in 2020 are still holding on to strong gains, and recently, the Federal […]

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