Oil prices are at a record low hovering at about 32 dollars a barrel, silver production is running at a deficit, inflation expectations are high, gold prices are playing catch me if you can at around 1,230 dollars an ounce at the time this article was being written, Iran just joined the oil supply façade which is bound to drive the price of crude price further down, while the Federal Reserve of the US hike interest rates and continue strengthening the already strong dollar.
How long is this supposed to go on? Well it will go on until the dollar based capital bubble explodes and place the entire financial system on the brink of collapse. Keynesian solutions have become prominent as national debts of nations go ballistic with most economies having public debts of well over a hundred percent. Those who have deemed the precious metals market as unattractive will not be doing so for long as some investors are already gradually converting their gains from the capital markets into hard assets in the form of gold bullion.
As debts rise faster than economic outputs which lead to higher taxes which have a direct impact on markets across the globe. Markets are in fact in a state of senseless chaos, nothing makes sense as they used to due to extensive market manipulation by not only large corporations, but also governments as they introduce false breakouts and sharp moves that make the poor poorer and the rich richer.
To avoid getting caught up in the rat race and the impending financial doom, individual investors are advised to cling on to the precious metal tree (physical bullion) as sooner or later the capital markets will collapse under their own weight at which point the precious metal market will rally and this rally will be unlike anything the investment world has ever seen before. Most governments have resorted to printing money and borrowing which will cause paper currency to lose more value than ever.
From an economic perspective, everything that has transpired between 2014 and 2015 is an indication of a serious flaw in the global markets that is obscured and veiled efficiently and effectively making it difficult to zero in upon. In most circumstances, when there is any sign of economic uncertainty the prices of precious metal immediately react positively due to increasing demand as market players flee capital markets to gold and silver havens.
However what is happening this time around does not make any sense and at times even the opposite takes place, indicating excessive market manipulation in the works. Nevertheless, no matter what happens, they cannot keep the manipulation going on for too long and eventually have to open the flood gates and for those who held on to their precious metal hoard, it will all good.
The current dollar’s surge will come to an end soon enough and it does not look like any other currency is going to replace its spot, leaving precious metals to take the lead – for a long bull run.