February 2020 - Week 4 Edition
Gold is Staging a Phenomenal Underappreciated “Stealth” Bull Market Rare Coins Should Benefit
Gold reached an official all-time high in U.S. dollar terms in September 2011 at $1,895 per ounce and then declined 45% to a low of $1,050 in December 2015 – four years and three months later. Now, we are nearly four years and three months past that low into a new bull market, and gold is just $235 from a new all-time high in U.S. dollar terms, up 58% in a little over four years. But that is in U.S. dollar terms, in a time when the U.S. dollar has been super-strong in a world with negative interest rates (in Europe and Japan) and weak currency performance in most other markets, including America’s trading partners.
On Monday, February 24, gold hit a new all-time high in the Canadian Dollar at C$2,222.84 per ounce
Gold prices are also at an all-time high in terms of the Japanese yen, at 185,016 yen per ounce:
The Euro also set a new all-time high on Monday at 1540.78 euros per ounce.
With the stock market declining, investors around the world are looking for safety. Investors in Europe and Japan have less-than-zero income in bonds, so gold looks particularly attractive. This is why investors around the world are pouring money into gold. Experience shows us that when gold has a powerful bull market move – as it did last year and early this year – many coin companies place ads in a variety of publications, drawing in new investors, who buy bullion coins and bars to use the power of gold as a proven crisis hedge, inflation hedge or portfolio insurance when stocks are dangerously high and falling.
Over time, we have seen that about one in eight to one in six of these customers (about 12% to 16%) graduate up to the often greater profit potential and collector satisfaction of rare gold and silver coins. This additional demand in an extremely tight rare coin market can push the prices of rare coins up sharply over time, creating a new bull market in rare coins, so it pays for clients to anticipate this price rise and buy rare coins when gold bullion is rising in price. In doing so, it is important to choose a dealer who knows the market through several decades of hands-on experience in the rare coin market.
Make sure that a national award-winning expert examines the coins that other dealers have sold to you, since they could be worth 10% to 50% less if they lack proper eye appeal and worth more with above average eye appeal. For example, I taught classes nationally in grading and counterfeit detection and have received several top awards from each of the four leading numismatic organizations.
Stay tuned: Next week, we’ll update Project 2020, where many of our handpicked selections have begun increasing in price.
Gold Is Up and Stocks Are Down in 2020
Gold shot up to $1,650 per ounce on Friday, then opened at $1,685 on Monday, February 24, reaching another 7-year high (the highest price since January 23, 2013) before consolidating at $1,660 by day’s end. Silver also surpassed $18.50 for the first time since September 5, 2019. Meanwhile, stock prices collapsed late last week based a rapid increase of coronavirus cases in many nations outside China. After the Dow declined over 1,000 Monday, it is down 2% for the year-to-date, while gold is up nearly 10%.
Listen for What is NOT Said in Tonight’s Democratic Presidential Candidates’ Debate
There will be another Democratic Presidential candidates’ debate tonight, in South Carolina. If it’s anything like last Wednesday’s debate in Las Vegas, hardly any substantial subject will be addressed because the journalists and candidates will be far more interested in focusing on a petty laundry list of the alleged personal failings of their fellow candidates. For instance, there were no questions or comments on the coronavirus last week, or the opioid epidemic, or the crumbling infrastructure of American cities.
The most glaring omission was the lack of any questions or comments about the soaring national debt. The sole mention of the word “debt” in the last debate was by candidate Elizabeth Warren, when she said, “we could cancel student loan debt for 43 million Americans.” (That, of course, would help some young Americans while defrauding those who loaned them money.) The only mention of the word “deficit” in the two-hour debate was by candidate Amy Klobuchar, who favored a citizenship path for Dreamers, saying citizenship would “bring down the deficit by $158 billion, and will bring peace for these Dreamers.” Other than that, Democratic candidates championed grandiose spending plans that would cost $35 to $50 trillion – or about 10 times the entire Fiscal Year 2020 federal budget of $4.75 trillion.
You can blame the politicians if you like, but why aren’t the journalists asking any substantial questions about the real issues facing American families? Why are journalists playing the same negative campaign game that the politicians are playing instead of speaking for the American people about important issues?
Important Disclosure Notification: All statements, opinions, pricing, and ideas herein are believed to be reliable, truthful and accurate to the best of the Publisher's knowledge at this time. They are not guaranteed in any way by anybody and are subject to change over time. The Publisher disclaims and is not liable for any claims or losses which may be incurred by third parties while relying on information published herein. Individuals should not look at this publication as giving finance or investment advice or information for their individual suitability. All readers are advised to independently verify all representations made herein or by its representatives for your individual suitability before making your investment or collecting decisions. Arbitration: This company strives to handle customer complaint issues directly with customer in an expeditious manner. In the event an amicable resolution cannot be reached, you agree to accept binding arbitration. Any dispute, controversy, claim or disagreement arising out of or relating to transactions between you and this company shall be resolved by binding arbitration pursuant to the Federal Arbitration Act and conducted in Beaumont, Jefferson County, Texas. It is understood that the parties waive any right to a jury trial. Judgment upon the award rendered by the Arbitrator may be entered in any court having jurisdiction thereof. Reproduction or quotation of this newsletter is prohibited without written permission of the Publisher.
Metals Market Report Archive