March 2020 - Week 1 Edition
Bank of America Securities Recommends Investors Hold 25% in Gold
Ten days before the stock market peaked on February 19, Bank of America (BofA) Securities came out with a new “Global Investment Strategy” report for the 2020s. On February 9, 2020, some of their analysts called for investors to adjust portfolios for the 2020s by going into a strategic posture of 25% (each) in stocks, bonds, cash and gold, saying the “Wall Street era of excess liquidity” will give way to “higher inflation, policy impotence, a war on inequality [and] national insecurity.”
They call this strategy 25/25/25/25, or a portfolio allocation of 25% in bonds, 25% in stocks, 25% in cash and 25% in gold, saying that should outperform today’s quantitative easing (QE) winners “(credit, private equity, tech).” Their timing was almost perfect, as the stock market peaked 10 days later, just before the coronavirus began spreading to other nations (first to South Korea, Iran and Italy) and the stock market collapsed the following week. At the same time, Bernie Sanders won convincingly in Nevada, becoming the front runner for the Democratic Party nomination. Leading Wall Street analysts have predicted that stocks would fall between 25% and 40% if Bernie Sanders won the Presidential election next November. Today, Tuesday, the Democratic primary elections will be interesting in this regard.
Gold and Silver Recovers
Gold and silver recovered Monday, with gold rising to over $1,600 briefly before retreating back to $1,590, but both gold and silver declined sharply last Friday, along with the stock market, which suffered its worst week since the 2008 financial crisis. The impact of the Coronavirus has played a major role in this volatility. In just seven trading days, the Dow fell over 4,000 points (-15%). After all the ups and downs of the first two full months of 2020, gold was up 5% vs. an 11% drop in the Dow through last Friday. On Monday, March 2, however, stocks recovered, at least for one day.
Update on Project 2020 – We’re Stockpiling Tomorrow’s Winners Today
We’ve been preparing a long time to assemble an inventory of what we think will be tomorrow’s top rare coin winners – based on several factors, including sheer beauty, historical importance and low population “capitalization” (value times numbers of coins certified by PCGS and NGC). These coins are becoming tougher to buy. Over the last few months, we have posted over $1.1 million in higher bids to get the finest specimens of $2.50, $3.00, $5.00 and $10.00 Indians, Type II and Type III $20 Liberty Gold, and the best classic Commemorative half dollars.
While bids on many of these coins are now rising 2% to 5% higher this month, we continue to invest in these coins, because we believe they are still underpriced relative to their population capitalization. In the process of accumulating these coins, we scrutinize each coin very carefully. We never sacrifice quality. We buy only hand-selected quality, which is the why you should only buy rare coins from national award-winning experts, like us. Each coin should have nice eye appeal. When you see these coins, you will know what I mean.
Call your representative for a description of our fresh inventory of classic American gold and silver coins. Each one is a classic piece of American history. Owning these coins is like holding history in your hands.
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