by winston » Sat Aug 05, 2017 8:59 am
Could gold be entering a sustained rally, and how much should I own?
by Keith Fitz-Gerald
I think conditions are right for a sustained rally but not for reasons most analysts think.
Specifically, the weaker U.S. dollar most analysts cite as if it's groundbreaking news is a "gimme" lately and, sadly, won't amount to much. What you really want to watch is these four things as I outlined them to more than 600 attendees at the Sprott Natural Resources Symposium in beautiful Vancouver, BC last week:
1. Janet Yellen never met a printing press she didn't like so she's got no idea how real money works, let alone how markets will react when the Fed starts trying to unload the $4.5 trillion in junk it has on its balance sheets.
2. Asia thinks about gold differently than we do in the west which means that there's likely to be a lot of unrecognized demand in the years ahead, much of which will come from China and India where the middle class is still expected to grow by 100 million or more people within the next 2 years.
3. Bitcoin speculators realize that it's not what they thought and that brings much of the price movement that used to be associated with gold prices back. And;
4. Gold is now a collateralizable asset - meaning traders can post it in conjunction with other instruments like treasuries to back up the leverage they use daily. The net effect is more liquidity.
Interestingly, the move probably won't begin right away, which means you've still got ideal time to pick up gold, bullion, mint certificates - whatever you like - at lower prices.
Studies show that 2%-5% allocation is about right for most investors, so use that as a starting point when it comes to your own portfolio.
Source: Money Morning
It's all about "how much you made when you were right" & "how little you lost when you were wrong"