BULL MARKET IN GOLD…We are now about to commence a full-fledged bull market in gold and gold mining stocks. The paper manipulation has been the chosen deception but did allow investors to take advantage of opportunities in some gold stocks that were incredibly undervalued and literally being given away at those prices. We expect to see enormous moves up in many of our gold and silver mining and exploration stocks in 2018. We actually saw some already.
Yet during the bear market in gold (manipulated) we have seen some of the mining stocks we recently bought have moves up of 900% to 1400% (Richmont, Claude Resources and Niogold). Yet, we recognize that half of our mining stocks will fail but many should be up 500% to 1500% or more; it will happen again. It is difficult to successfully find and commence production in gold and other commodities. I had recently recommended several mining stocks to some people, but no longer. It is best to keep ideas to yourself in this now very illiquid market in gold stocks.
Historical Market makers’ support as when they would hold gold stocks in their firms’ “inventory” is rare today. The small almost non-existent spreads between the “bids and offers” has devastated the market makers’ profitability. This has caused stocks to plunge to much lower prices than in the past. But the positive fact is that it has enable investors to purchase shares at lower price levels than were able to in the past when generally specialists/market caught the bottoms.
By our analysis, when gold exceeds $1400-$1500, many mining stocks that have been languishing at surprisingly low prices will have enormous moves up on a percentage basis. We say that based on history.
INSIDERS, OFFICERS AND DIRECTORS OF THE MIINING INDUSTRY… Other investment services have recently emphasized that the officers and directors of the gold mining industry stocks have been very heavy investors in their own companies’ shares. We have pointed that out for three years. (Note well that they work there)
MAIS AU CONTRAIRE
INSIDERS, OFFICERS AND DIRECTORS OF THE MAJOR INDUSTRIAL STOCKS… It is hidden by the business media but insiders of the major American corporations have been selling their personally owned shares in their companies at the highest rate in history several consecutive weeks reporting over $500,000,000 of their own companies’ shares. These selling levels occurred before in 1999-2000 and 2007-2008, just before the brutal bear markets.
Note the obvious manipulation of gold bullion on the commodities exchange–not in the true bullion market. They are paper contracts and are not true gold bullion. However, under the appearance of gold weakness, China, India and Russia have been accumulating all the gold bullion they can without pushing the price up. It is to their advantage to buy the gold during weak prices. Note well that as huge buyers of gold, their focus is to purchase gold bullion at the lowest prices available.
Germany finally received its 350 tonnes held in “safekeeping” at the New York Fed. It took four years to get their gold. Why so long? The big question? Was the German Government’s gold actually there?
We have been asked before “what would happen if all the gold represented in safekeeping and in futures contracts was called for delivery?” We estimate and believe that gold bullion would be at $2000 quickly. Others project that it would be much higher.
The major New York brokerage houses do not want gold prices up since a bull market in gold occurs most often with a bear market in industrial stocks such as the Dow Industrials and S&P 500 stocks and their profitability plunges during bear markets. Brokerages rarely issue gold recommendations and rarely ever acknowledge a bull market in gold. Bankers, Brokerages and Central Bankers hate gold as it clearly indicates and monitors their incompetence. Incompetence? $100,000 cash when Ronald Reagan was U.S. President has a buying power of between $31,000 and $35,000 today.
The peak gold period has passed and the “easier to find gold” seems to be gone. Much more time, effort and money must be put into exploration. Few large deposits have been found in recent years and mine production has been flat for several years.
Long Term Cycles in gold indicate that a bull market is imminent and it is important to note that several important cycles are occurring simultaneously suggesting just that. We do not believe that inflation is merely one percent or so, our analysis suggests closer to four to five percent if we include medical, energy and certain foods. By our indications, it is not one or two percent as has been reported.
MOST IMPORTANTLY, THE U.S. DOLLAR… By far the most important influence on the price of gold is the U.S. Dollar. The formula for the price of gold based upon the dollar is almost where we need to see it. Nothing is more important. Printing? The U.S. Government is running a one billion dollar deficit every day and it is rarely discussed. It may end very sadly.