Metals Market Report Archive

The Mike Fuljenz Metals Market Report

December 2023 - Week 1 Edition

Gold Hits Record High But Predictions Mark This As Only The Beginning

Gold set an all-time high above $2,135 on Sunday and early Monday, December 3-4, but it could not hold those gains by the close of trading on Monday. The futures price (February) topped $2,152. Gold was super-charged by “dovish” comments by Federal Reserve officials to the effect that future interest rate reductions may begin earlier in 2024 than previously expected. Also, the resumption of hostilities in the Middle East fueled gold’s role as a crisis hedge and purchases by central banks and other government agencies contributed to gold’s rise. Later, profit-taking by speculators cut the rally short and gold’s price settled; however, experts predict this upward trend is only the beginning. I strongly encourage people to purchase gold now before it continues its rise and to buy gold regularly to continue to protect their portfolios from “the follies of government” as Steve Forbes said to me, recently. I also want to point out to collectors that these market trends are affecting rare gold prices and we continue to see certain rare gold and even silver coins making gains greater than spot prices. Call your professional account representative today to learn more and see where you can make educated choices for your collection.

Silver followed gold up, but not as energetically as it did in November when silver rose over 10%. On Monday, silver briefly hit a seven-month high above $26 but it settled back to $24.50 later Monday. A rise in the U.S. Dollar Index contributed to the correction in both metals, which I believe is only temporary. In the first four weeks of November, the U.S. Dollar Index declined 3.75%, but it gained over 1% since Tuesday, November 28. Even after the correction, gold is still up over 600 percent since the beginning of Y2K vs. a little over 200% for the main stock market indexes! Gold still has room to rise, since it is not yet at a real peak: The inflation-adjusted value of $850 gold in 1980 would be around $3,000 in today’s money, well above the current $2,000+ price levels.

U.S. Mint Sales Soar and Silver Shines in November

Gold set an all-time high in early December and it closed November strongly as well, at $2,035. Silver did even better, gaining over 10% during the month. Stocks also did well but silver won the proverbial gold medal, beating the Dow Jones Index and the S&P 500, as well as gold during November.

It’s important to remember that stock indexes are biased because they are “capitalization weighted,” giving prominence to the largest stocks. Specifically, 90% of the gains in the S&P index and NASDAQ this year are attributable to the top 10 tech-related stocks, with 490 of the 500 stocks virtually treading water. 

In fact, two stocks (Microsoft and Apple) each represent 7% of the S&P 500 and they are each 35 times larger than all mining and mineral stocks combined! Also, the Dow and S&P substitute better stocks for worse stocks from time to time, whereas gold, silver and other precious metals are simply chemical elements, always the same!


Two Energy Conferences Display “Polar Opposite” Values About Burning Fuel

Isn’t it ironic that OPEC+ (that’s basically OPEC plus Russia) could meet to set their crude oil production quotas by online computer connection but the anti-fossil fuel zealots, who believe in global warming (oops, I mean “climate change”) must fly to some remote location – each in their own private jet – to lecture the rest of us on why we should not drive private cars or light trucks in our neighborhoods?

This silliness and open display of private privilege (let’s call it what it is, hypocrisy, and arrogance!) reached a peak when Great Britain’s three top officials – Prime Minister Rishi Sunak, Foreign Secretary David Cameron, and King Charles III – each took their own private jets to attend the United Nations 28th “Conference of Parties” (COP28) Climate Change meeting, beginning on November 30th in Dubai.

It’s a well-known fact that “even a short trip on a private jet will produce more carbon than the average person emits all year,” noted one Green Party critic.  Meanwhile, OPEC+, which was also scheduled on November 30 met online – something the “climate change critics” could have done for a decade or more!

In another irony at this year’s climate conference, a massive snowstorm kept many attendees from reaching Dubai on time, as many private jets were literally frozen to the tarmac in European airports. Munich’s runway was under 17 inches of snow after Germany’s worst-ever December blizzard.

Gasoline and natural gas prices will likely rise this winter since OPEC+ announced cuts in new crude oil production of 900,000 barrels per day and we’ll likely have a colder-than-usual winter due to El Nino weather patterns. In addition, severe storms in the Black Sea disrupted up to two million barrels per day of crude oil exports from Kazakhstan and Russia last week, according to a Caspian Pipeline Consortium.

Meanwhile, car dealers can’t sell electric vehicles. Last week, 3,882 U.S. car dealers signed a letter and sent it to President Joe Biden saying that U.S. car buyers are not interested in buying EVs, which they now call Battery Electric Vehicles (BEVs), even with government subsidies. Part of their letter stated, “The reality is that electric vehicle demand today is not keeping up with the large influx of BEVs [Battery Electric Vehicles] arriving at our dealerships, prompted by the current regulations. BEVs are stacking up on our lots.”  The letter added, “We’ve never seen a situation where government has intervened in such a draconian way.”

If the Biden Administration keeps pushing these unpopular solutions on Americans, voters may retaliate.


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