• 741 days Will The ECB Continue To Hike Rates?
  • 741 days Forbes: Aramco Remains Largest Company In The Middle East
  • 743 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,143 days Could Crypto Overtake Traditional Investment?
  • 1,148 days Americans Still Quitting Jobs At Record Pace
  • 1,150 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,153 days Is The Dollar Too Strong?
  • 1,153 days Big Tech Disappoints Investors on Earnings Calls
  • 1,154 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,156 days China Is Quietly Trying To Distance Itself From Russia
  • 1,156 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,160 days Crypto Investors Won Big In 2021
  • 1,160 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,161 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,163 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,164 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,167 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,168 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,168 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,170 days Are NFTs About To Take Over Gaming?
The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

  1. Home
  2. Markets
  3. Other

Is Gold Hated Enough?

An article by Mark Hulbert jogged the title's question into my mind:

This Bear Market in Gold Still Has too Many Bulls

With respect to the reasons for owning gold, I never flinch when taking a long-term value perspective. In the monetary and financial world gold is insurance and insurance is something you buy, but hope to never need. The value of insurance is in one of its definitions: "a thing providing protection against a possible eventuality".

It is good news that this 'thing' has not been needed as modern policy making has worked to mostly desired effects, as asset markets have been pumped by inflationary policies that have not (yet) had a commensurate level of risk discovery.

It is bad news that this 'thing' will be needed in the future because risk - especially when mainlined into the system through brute force policy - is always discovered, eventually.

It will be very good news for the relative few who have kept perspective and balanced the bear market risks in gold and the gold stock sector with the coming potentials. As with any bear market, there have been perma bulls calling bullish all the way down. But at some point, the new breed - the perma bears - are going to be exterminated.

The message of the big picture work done in NFTRH (as summarized in a recent eLetter/NFTRH.com post) is that the time is coming, but for short-term speculators, risks remain. So as I have written for what seems like forever, individuals absolutely must understand who they are and what their goals are or risk being lost along the way to the bear market's conclusion and the new bull market's beginning.

When I read analysis talking about how strong US employment data are going to send large institutions running for the inflation protection of gold I tend to agree with Hulbert. When I read things like Modi + Indian Wedding Season = Gold Bull I tend to agree with Hulbert. When I read about China's voracious demand for gold and that you'd better buy with the smart money, I tend to agree with Hulbert.

I won't go into all the reasons why 'gold as an inflation hedge' is a faulty outlook. This post is not about that oft-belabored point. I will simply ask you to beware of the anti-USD obsession as applies to gold and the inflation hysterics that usually go with it. Best case, gold would be just another item amongst commodities if the play is anti-USD.

We await a counter cyclical environment that may well include a firm US dollar. This would not make sense to the still intact legions of pre-programmed devotees in the gold "community". And right there is another reason why on the short-term, Hulbert may be right. Opportunity is coming, but it is not going to wear bells on its heels, a big smile on its face and dance around in front of you until it is understood.

 


Subscribe to NFTRH Premium for your 25-35 page weekly report, interim updates (including Key ETF charts) and NFTRH+ chart and trade ideas, or the Free eLetter for an introduction to our work. Or simply keep up to date with plenty of public content at NFTRH.com and Biiwii.com. Oh, and follow @BiiwiiNFTRH

 

Back to homepage

Leave a comment

Leave a comment