- Inflation is getting out of control and it seems professionals are asleep.
- Federal Reserve is in a box and can't raise rates because it would have to admit default.
- Not 1 gold or silver bug of the past is saying to buy now.
It's really odd. In the past I couldn't go a month without hearing Jim Rogers, Michael Burry, Stanley Druckenmiller talk about buying gold. Recently Jim Rogers has said he is not buying Gold and Silver right now and is waiting for a bigger correction. Michael Burry said recently that Gold will not be a safe investment in the upcoming inflation because government will try to crush any competitors to the US Dollar. Stanley Druckenmiller has not added to his gold position recently and instead in 2020 has been focused on bitcoin. It feels like this is the most primed the Gold and Silver market has been in over the last 10 years. I think 10 years of no progress has worn out even the most ardent bulls which is a great sign of the possibility to come. This is the time they should be buying and are totally ignoring the most opportune moment. It's funny to watch interviews with perma-bear skeptics as they all seem a little googly eyed over this monster rally of the past year to the point where they don't even speak negatively of equities anymore nor make the bull case for gold and silver when they obviously should be. Especially at a time when it's so obvious that if there were ever a time to be a buyer it is definitely right now while commodities are exploding and precious metals are lagging. Historically that's how bull runs start in precious metals. They lag commodities then play catch up.
Meanwhile at the same time this is the exact time to get bearish on the market and economy with input costs about to rise for companies and earnings should take a hit while inflation keeps rising. It's quite odd to see market veterans not be more confident at a time when they should be. But all in all its a good sign when you see promoters of the past get worn out as that is most likely a signal to get in as they will be caught flat footed and chasing the move higher. But of course they will be hailed in the mainstream media as the " I told you so crowd" meanwhile they were totally asleep at the wheel and probably won't wake up till its 30% higher from here. Mark this post.
Note: I could of course change my mind about silver and gold if the fed does something surprising such as target the money supply or aggressively raise rates. Anything can happen and I will keep an open mind.
Analyst's Disclosure: I am/we are long SLV.
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