Dateline June 5, 2015: Gold and silver prices are hovering around the lows they put in last year, although they have not broken lower. This suggests a bottoming in price is taking place. Will there be another bull market in gold and silver? And when? What, then, will cause the price of gold and silver to go up, perhaps quite a bit? And why should the average Joe care?
There are five catalysts that could cause the price of precious metals to pike upward, according to a recent article by Stefan Gleason. published in TheStreet.com These are:
- The Fed delays Interest Rate Hikes: This might mean the US economy is extremely weak, and could cause the dollar to decline. A declining dollar is bullish for gold and silver.
- Real Interest Rates turn Negative: When inflation ramps up, the real rates of interest can be blow the rate of inflation. Although benign now, inflation could easily commece with all the fiat dollars the US has printed over the last few years. This would be bullish for gold and silver.
- A Debt Crisis hit the United States: Look at all the debt the US government has racked up. Who’s going to pay it? Is it even payable? When the crows come home to roost this could cause an major flight to precious metals, driving up their price.
- Geopolitical Turmoil Flares Up: Everyday the news is filled with troubling scenarios around the globe. Russia invading Ukraine, ISIS on the march, Iran and Saudi fighting a proxy war in Yemen, to name but a few. If any one of these get really out of control, a major flight to gold and silver could ensue.
- Declining Mining Production of Gold and Silver: There is only a finite amount of gold and silver in the Earth that can be mined. How much of it has already been produced? Some published reports suggest the world is running out of gold. A decline in supply will certainly make the price increase.
To this list we could add several other possible catalysts:
- A Major Rise in Sea-level caused by Climate Change that Inundates Major Population Centers: Heck, maybe Al Gore is right and superstorm Sandy is just a taste of what’s to come.
- Acquisition of Nuclear weapons by Iran and other Terrorist Groups: This would certainly cause more than a few jitters.
- The Dollar Ceasing to be the World Standard for Currency: Not an unthinkable possibility.
The next Great Bull Market in Gold and Silver
Also of interest is the recent article by Avi Gilburt in MarketWatch. He also suggest that we are on the cusp of the next great bull market in the investing world: Not stocks, not bonds, but gold. During the last bull market in gold, from 2000 to 2011, gold prices rose from $250 an ounce to just over $1,900 an ounce in just that amount of time. Gilburt believes that we are poised for anther decade-long rise in gold price.
What can the average Joe or Jane do?
Realize that now is the time to be purchasing gold and silver, while prices are relatively low. Online precious metals brokers are safe, discreet and reliable. They often have the better prices than other sources. Consider buying through our preferred broker Golden Eagle Coins. A trusted broker, they keep have the customer’s best interest in mind.
Update Sept. 2016: Indeed precious metals have taken off higher in a year’s time. Click here for more info on the new bull market in gold and silver.
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