• 396 days Will The ECB Continue To Hike Rates?
  • 396 days Forbes: Aramco Remains Largest Company In The Middle East
  • 398 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 798 days Could Crypto Overtake Traditional Investment?
  • 803 days Americans Still Quitting Jobs At Record Pace
  • 805 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 808 days Is The Dollar Too Strong?
  • 808 days Big Tech Disappoints Investors on Earnings Calls
  • 809 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 811 days China Is Quietly Trying To Distance Itself From Russia
  • 811 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 815 days Crypto Investors Won Big In 2021
  • 815 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 816 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 818 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 819 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 822 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 823 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 823 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 825 days Are NFTs About To Take Over Gaming?
What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

  1. Home
  2. Markets
  3. Other

Regardless of Stocks' Direction, Don't Forget Gold and Silver

With global equity markets finally showing that they can go down as well as up, it is worth asking what this negative movement in the equity markets has to do with the future of gold and silver prices. I think the idea that the stock market is going to collapse while the precious metals recover all of their losses since 2011 is more than a bit premature. In fact, going back to 2009, I really felt that most investors should be at least agnostic on the future of the conventional stock markets, with central bankers trying to levitate financial asset values for all of the reasons made clear to us with policies like quantitative easing. But, at the same time, by trying to ensure that no one loses money in the conventional markets, I suspect that that will also take away any explosive returns from these investments. I'm thinking here of what happened nearly 80 years ago once bank deposits were insured - their real rate of return declined.

Of course, since I haven't actually seen central bankers come out and tell people that stock investments are risk-free, I'm not so convinced that central bankers aren't willing to at least start the process whereby some of the exuberance is taken out of the broader stock indices. Might gold and silver catch a bid if people realize that the central bank put under stocks doesn't exist?

On the other hand - and looking out longer term - whether or not central bankers are able to control the direction of the markets, it certainly seems as though they are hell-bent on creating inflation- something that we have had very little of recently. Are gold and silver prices reflecting this long term desire for inflation? I don't think so.

 

Back to homepage

Leave a comment

Leave a comment