Weekly Briefing 6/20/21 - The Forecast

Weekly Briefing 6/20/21

Weekly Briefing 6/20/21

The Golden Slingshot

Since 2000, gold has outperformed nearly every asset class on the planet. However, it did not accomplish this without incredible volatility along the way.  Gold is an asset that is largely dominated by Fed bullion banks – making life difficult for positional and short term traders. After 9/11, the debt bubble began expanding rapidly across the globe courtesy of continuous wars, nation building, exaggerated quantitive easing, financial bailouts, and finally now the COVID pandemic. The reasons to own gold are numerous: inflation, currency debasement, derivatives risk ($200 trillion worldwide), sovereign debt, global conflict, and an impending Keynesian implosion.
In this briefing, we offer some premium research for all of our free members. Over the next few years into 2024, the world will witness the largest price moves in the history of precious metals. Expect gold to surpass $5000 and silver $150. Expect much higher risk in money market funds similar to what occurred in 2009.  Cash will be trash and hard assets should be owned instead.  While small crypto stocks or small cap stocks are capable of delivering significant returns, the risk they present is far higher. As these shakeouts and volatility events like we are seeing now occur in precious metals, the general public become the sellers while the central banks are the buyers. Precious metals are wealth, currencies, and commodities all wrapped into one package which is why they are hated by central banks (which desire higher valued currencies which gives more faith in government and the longstanding economic system) but they are a necessity in light of the global debt-ridden financial system.  This path became inevitable after President Nixon took us off the gold standard in the early 1970’s and allowed congress the power to spend money unscrupulously. We will continue to positionally trade precious metals over the next 5 years as many wild swings will be in store for this sector. Bullion banks just pushed down the price of metals as they covered the largest short positions ever seen in the complex since last March during COVID. The result then was a slingshot move in gold, miners, and silver over the following 6 months. The push down last week and likely early this week will have the same end result. A large reduction in open interest in futures contracts and a massive short covering in commercial shorts will have major upside effects on metals.  It is hard to know the exact strategic positions of bullion banks into major regulatory changes like Basel III coming on June 25.  No one expected a break of $1,800.  Over the last three months we have seen the reduction of commercial shorts by 50%.  We have also seen heavy futures options purchased in the gold market which convert into an incredible amount of gold should the gold market move up drastically.  Now that the banks have shown their hand, we can tell members to prepare for another slingshot move in precious metals into September with silver likely topping last before an intermediate peak is set. A core position into 2024 is warranted for all investors in our opinion, especially silver which is capable of astronomical returns. Consider a Gold membership to capitalize on these moves over the coming months as precious metals can deliver incredible returns in very short periods of time.