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GUEST POST: What Portfolio Theory Says About Investing In Gold

Gold (GLD) is by far the most controversial asset class. The yellow metal has always attracted more than its fair share of colorful personalities. Gold is historically the world’s best store of liquid wealth and a defense against potential devaluation of fiat currencies. But is gold still a viable investment? The answer depends on how you’re trying to invest and what your goals are. For many investors, gold is a good choice. A 5-7 percent allocation to gold has been shown to reduce volatility in difficult times and provide a countercyclical benefit to your portfolio.

The logic behind investing in gold

Since the creation of the Federal Reserve in 1913, the purchasing power of the US dollar has steadily declined.

For more on this article, please click here:

https://goldsilverpros.com/2019/02/01/guest-post-what-portfolio-theory-says-about-investing-in-gold/

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An Analysis of Pretium Resources (PVG)

Having recently arrived back from Vancouver and the annual Resource Investment Conference held at the city’s convention center, I was looking for fresh ideas for the gold mining space for my readers. The best of the bunch from the conference for mid-tier producers is Pretium Resources (PVG). I spoke with company representatives about their project.

Pretium Resources

The Brucejack mine is an underground, higher grade mine located in British Columbia.

To finish the article, click here:

https://goldsilverpros.com/2019/02/01/an-analysis-of-pretium-resources/

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Interview with Nordic Gold President & CEO Michael Hepworth

I visit with Michael Hepworth, who is President and CEO of Nordic Gold. Nordic Gold owns a gold mine in Finland, a safe jurisdiction for gold miners.

Agnico Eagle owns one of the largest gold projects in Europe about 500km north of Nordic’s mine, so this is a very productive and established region for gold mining.

Michael and I discuss the economic analysis and feasibility of his project, including expecting to achieve full commercial production in Q1 of 2019.

The mine was fully built by the last operator, and so costs were low to get the project up and running. In addition, Nordic has $150million in tax loss carry-forwards from the previous operator which should shield most of the cash flows from the current project over the expected 6 year mine life.

The upside of the project is that about half of the owned property has not been fully explored. Nordic has done some preliminary geological study analysis, and has found the rest of the land package holds similar characteristics to the current mine. Therefore, Michael is excited about the potential for finding more gold onsite.

The market cap of the company is below the net present value of the project, so it is undervalued. The stock price should increase more when the project reaches full commercial production.

Also the gold price is in a rising uptrend which offers further upside potential for the share price for investors.

The previous company did not properly handle some aspects of the project which is why they are no longer mining, but those problems have been resolved by Nordic who now has a positive relationship with the local regulatory bodies and the town which supports the mine project.

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Venezuela Erupts, Yellow Vests Protest, & Socialism Stinks

On this weeks market wrap-up, we discuss why gold and silver are moving up in the last week while protests in Venezuela and France increase.

We also discuss why gold and silver are your safe haven assets, and not fiat currencies like the Dollar or Yen and especially not debt assets like bonds.

Find us on Twitter for the latest channel updates: Tweets by GoldsilverP

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First Day Thoughts from Vancouver Resource Investment Conference

Vancouver, B.C.

So I am currently staying in downtown Vancouver while I attend the 2019 Vancouver Resource Investment Conference. This is my second year coming here and it is usually quite the learning experience. Tons of companies come to show off their projects and discuss business with investors; while what I am most interested in is research into the gold, silver, and other commodity space to bring valuable insight to my readers.

The theme so far on the first day is that while gold is doing well in 2019, the gold miners aren’t doing so hot. The HUI Gold Bugs index is down for 2019 despite gold’s gains.

To finish the story, click here:

https://goldsilverpros.com/2019/01/21/first-day-thoughts-from-vancouver-resource-investment-conference/

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Leveraged Loans, Russian Dumping, Phillips Curve and the Fed

On today’s edition, I talk about how the stock market indices all act the same and the two reasons why that happens.

I also cover what insiders are doing, and have been doing, since the last great recession in 2008.

I cover what is happening to the leveraged loan market since December and what that means for the current credit cycle.

I discuss why the Phillips Curve that most Fed economists use doesn’t work and what that means for current dollar policy.

Lastly, I examine why Russia just shifted out of $100 billion in US dollars into the Chinese Yuan, Japanese Yen, and the Euro.

Click the video link for today’s weekly market wrap-up from Gold Silver Pros.

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Silver

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From Magic to Medicine, Silver's Luster Outshines All

Since the beginning of time, silver has fascinated people around the world. The metal has been the subject of various religions, a tireless tool of trade, a shiny sign of wealth, and a unique metal whose very special properties have made it stand out from its peers.

Summary

Here are the top ten reasons why silver will shine brighter than gold in 2019.

Silver is a part of age old religious traditions across the globe.

Silver’s unique luster has made it one of the most popular components of many culture’s adornment during ceremony.

Silver can be used to keep food and drink safe to consume.

Silver has a long list of medicinal uses which are increasing each year as we come up with new uses for it.

Silver was instrumental in establishing the world wide personal photography movement, which is the basis for the popularity of photographic services now spreading across the Internet.

Silver is critical for development of green technologies designed for a cleaner and more efficient environment.

Silver is essential to the many electronic devices we rely on today for our everyday enjoyment and productivity.

Silver is essential to automobiles and therefore autonomous movement of people.

Silver can be used as an alternative money substitute when economies experience extreme conditions such as in Argentina and Brazil. Indeed, silver was the very first monetary metal and has existed in this context for over 6000 years. And it is cheaper per ounce when times are tough.

Silver is used in coins and medal for wealth preservation because it is expected to grow in use and value while available production declines at the same time. Unlike gold, most silver is not safely stored away in bars and coins.

So if you trying to decide which precious metal is more valuable moving forward, then I say pick silver! But really, you can’t go wrong with either one of them.

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10 Reasons Why Silver is the World’s Most Noble Metal

Since the beginning of time, silver has fascinated people around the world. The  metal has been the subject of various religions, a tireless tool of trade, a shiny sign of wealth, and a unique metal whose very special properties have made it stand out from its peers.

Here are 10 reasons why silver is the world’s most noble metal.

Silver is a part of age old religious traditions across the globe.

Silver’s unique luster has made it one of the most popular components of many culture’s adornment during ceremony.

Silver can be used to keep food and drink safe to consume.

Silver has a long list of medicinal uses which are increasing each year as we come up with new uses for it.

Silver was instrumental in establishing the world wide personal photography movement, which is the basis for the popularity of photographic services now spreading across the Internet.

Silver is critical for development of green technologies designed for a cleaner and more efficient environment.

Silver is essential to the many electronic devices we rely on today for our everyday enjoyment and productivity.

Silver is essential to automobiles and therefore autonomous movement of people.

Silver can be used as an alternative money substitute when economies experience extreme conditions such as in Argentina and Brazil. Indeed, silver was the very first monetary metal and has existed in this context for over 6000 years.

Silver is used in coins and medal for wealth preservation because it is expected to grow in use and value.

Silver in Magic and Mystery

Silver has been associated with magic because it never rusts, does not react with other substances, and keeps food and water fresh and pure. Many people used it in shamanistic rituals. It has been in fact associated with the gods because it did not seem to tarnish and wear over time like the other metals. Its special properties were associated with supernatural powers, where mystic literature claims that werewolves and vampires should be killed with silver. It is also believed to deflect harmful spirits and energy.

To read more on this article, follow the link to Gold Silver Pros.

https://goldsilverpros.com/2019/01/14/10-reasons-why-silver-is-the-worlds-most-noble-metal/

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Best Asset Classes Of 2018: Gold And Residential Real Estate

Summary

Stock markets are down for 2018, with small caps bleeding all over the floor.

Bond rates are up and prices will come down to equalize yields, forcing bond holders into haircuts if rates don’t reverse.

Commodities are almost all down, with a very few notable exceptions.

Residential real estate is up overall, but the sales, price, and inventory data appear to have called the top.

Gold is down slightly, but is the only one of these asset classes to have a sustained, strong uptrend to end the year with fundamentals pointing to an even stronger 2019.

If you had made bets on which of the major assets classes would outperform in 2018, which would you have chosen?

Stocks?

Bonds?

Real Estate?

Commodities?

Precious Metals?

I would wager that sentiment would have placed stocks in first place, real estate second, commodities third, bonds fourth, and precious metals last simply by the amount of coverage and hype that I have seen over the year for each of those markets. But, 2018 is clearly a transition year for the stock and bond markets which did not fare well.

The Downers

Each of the major stock indices ended the year down, including the Dow, S&P500, NASDAQ, and Russell 2000. Small caps ended down the most at 13%, whereas the NASDAQ was down only 5.3% on the year.

Source: Yahoo Finance

Debt markets did not do well at all. Here is the 12-month LIBOR, whose rates spiked up almost a full percent on the year. If you are a corporate entity holding millions or billions of dollars in variable rate debt, the trend in rising LIBOR rates most definitely are not your friend.

Source: Fred

Here is the 2 year US Treasury, which spiked from 1.91 to 2.52. That is a 32% loss if you bought on Jan 1 this year and sold today, Dec 31, 2018.

Source: Fred

The 10 year treasury went from 2.4 to 2.77 percent. That is a 15.4% loss if you bought on Jan 1 and sold Dec on 31 this year.

Source: Macro Trends

The CRB commodity index is down about 10% on the year.

Source: Trading Economics

Here is a whole list of different commodities and their YTD performance. Notice that for a few special exceptions, the components are almost all down for 2018.

Commodity1 Month Change12 Month ChangeYear to Date Change

Commodity Agricultural Raw Materials Index-0.98 %-0.61 %-5.37 %

Commodity Beverage Price Index0.16 %-5.15 %-0.80 %

Commodity Price Index

Commodity Fuel (energy) Index-15.44 %6.89 %-3.68 %

Commodity Food and Beverage Price Index

Commodity Food Price Index-1.63 %-4.82 %-6.39 %

Commodity Industrial Inputs Price Index

Commodity Metals Price Index-2.34 %-7.14 %-12.50 %

Commodity Non-Fuel Price Index-1.32 %-4.32 %-6.85 %

Crude Oil (petroleum), Price index

Coal, Australian thermal coal-7.36 %4.23 %-5.37 %

Coal, South African export price-8.73 %0.21 %-6.05 %

Crude Oil (petroleum)-18.78 %3.99 %-5.90 %

Crude Oil (petroleum); Dated Brent-19.01 %4.16 %-5.54 %

Crude Oil (petroleum); Dubai Fateh-17.54 %7.48 %-1.38 %

Crude Oil (petroleum); West Texas Intermediate-19.90 %0.04 %-10.99 %

Diesel-12.22 %6.89 %-1.25 %

Gasoline-19.87 %-11.20 %-14.43 %

Heating Oil-12.11 %11.52 %0.79 %

Indonesian Liquified Natural Gas0.00 %37.99 %24.84 %

Jet Fuel-13.52 %10.51 %-0.36 %

Natural Gas25.84 %38.46 %6.70 %

Propane-22.31 %-23.98 %-17.59 %

RBOB Gasoline-22.85 %-5.28 %-10.55 %

Russian Natural Gas-5.92 %23.62 %24.17 %

Cocoa beans2.82 %2.82 %12.31 %

Coffee, Other Mild Arabicas-0.33 %-2.89 %-1.31 %

Coffee, Robusta-2.13 %-8.46 %-5.64 %

Tea-2.48 %-20.81 %-20.27 %

Barley0.00 %10.18 %-1.88 %

Canadian Wheat

Maize (CORN)0.27 %8.06 %3.11 %

Rice-1.96 %-0.25 %-9.28 %

Soft Red Winter Wheat0.84 %20.03 %18.23 %

Sorghum-0.90 %-6.05 %-11.73 %

Wheat-4.65 %13.29 %5.93 %

Bananas

Oranges-2.67 %-15.12 %-3.95 %

Beef2.33 %-8.78 %-8.14 %

Poultry (chicken)0.00 %3.57 %-1.93 %

Lamb

Swine (PORK)

Fish (salmon)

Shrimp1.75 %-4.19 %-5.66 %

Sugar-3.45 %-15.15 %-9.68 %

Sugar, European import price-2.63 %-2.63 %-7.50 %

Sugar, U.S. import price-1.79 %-8.33 %-6.78 %

Coconut Oil-6.29 %-49.38 %-43.56 %

Fishmeal-0.34 %6.52 %-7.55 %

Olive Oil, extra virgin

Palm Kernel Oil-10.79 %-50.90 %-43.92 %

Palm oil-8.56 %-25.94 %-23.27 %

Peanut Oil0.48 %-4.12 %0.52 %

Groundnuts (peanuts)-3.27 %-2.83 %3.70 %

Rapeseed Oil-1.17 %-12.71 %-0.92 %

Soybean Meal-2.13 %4.72 %-2.20 %

Soybean Oil-3.06 %-17.75 %-16.22 %

Soybeans1.68 %-5.00 %-3.95 %

Sunflower oil-1.66 %-12.81 %-11.63 %

Coarse Wool

Copra

Cotton0.00 %7.91 %-4.98 %

Fine Wool

Hard Logs-0.43 %-0.43 %-2.08 %

Hard Sawnwood

Hides

Plywood-0.43 %-0.43 %-2.08 %

Rubber-5.59 %-14.01 %-21.51 %

Soft Logs

Soft Sawnwood

Wood Pulp0.00 %0.00 %0.00 %

Aluminum-4.50 %-7.58 %-12.27 %

Cold-rolled steel

Copper, grade A cathode-0.38 %-9.24 %-12.31 %

Gold0.43 %-4.78 %-8.31 %

Hot-rolled steel

Iron Ore-0.20 %14.04 %-4.03 %

Lead-2.54 %-21.30 %-25.04 %

Nickel-8.73 %-6.12 %-12.63 %

Rebar

Silver-1.71 %-15.49 %-16.23 %

Steel wire rod

Tin-0.30 %-2.52 %-7.89 %

Uranium

Zinc-2.92 %-19.62 %-24.58 %

DAP fertilizer-2.51 %19.24 %13.82 %

Potassium Chloride0.00 %0.00 %0.00 %

Rock Phosphate1.37 %15.63 %15.63 %

Triple Superphosphate-1.56 %28.47 %18.44 %

Urea13.19 %9.14 %39.14 %

Source: Index Mundi

REIT investments overall did not fair too well in 2018, which per the Dow Jones Real Estate Index were down 8.2% on the year.

Source: S&P Dow Jones Indices

The Semi-Bright Spot With Weakening Fundamentals

US Residential real estate led the charge in 2018, up 4.9% according to Case-Shiller.

Source: Fred

However, indications are that retail inventories are rising and sales are down, so it appears the bull market in residential real estate may have come to an end. The index above was relatively flat for the last 6 months of the year, also indicating a price top may be in.

Gold is Alone in Ending 2018 in a Sustained Up Trend

Surprising to most is the fact that gold held its own in 2018, ending down just 1.6% for the year.

Source: CNBC

Of these asset classes, only gold ended the year in a solid uptrend, largely on concerns of volatility in the stock markets and a weakening picture for debt securities. If you are concerned about the other markets, gold may be a good piggy bank savings vehicle for you in 2019.

Photo Credit

Summary

Unless the bond markets stabilize and LIBOR rates come back down, then the broad stock indices will continue to suffer on expectations of decreased corporate earnings and higher US budget deficits. These factors favor a continued increase in the gold price in 2019.

Does the performance of the major asset classes in 2018 surprise you? If we had taken an investor survey on January 1, I bet it would show expectations almost exactly opposite of the results we have had for 2018.

As a result, 2019 is shaping up to be a very interesting year for investors that have become reliant on the 30 year bond bull and the nearly 10 year stock bull markets.

I predict gold and silver will shine in 2019 while the other major asset classes see continued price volatility.

Source article: https://goldsilverpros.com/2018/12/31/best-asset-classes-of-2018-gold-and-residential-real-estate/

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I discuss the market crash today which is based upon weakness in the banking sector as well as the 3 and 5 year treasury curve rate inversion.

Find the full article on our website:

https://goldsilverpros.com/2018/12/05...

Find us on Twitter for the latest channel updates:

https://twitter.com/GoldsilverP

Video Link:  https://www.youtube.com/watch?v=Q9YUSWKyzHs&t=17s

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I stopped by Phoenix recently to have a meeting with one of my favorite market analysts, Lynette Zang.

She is Chief Market Strategist for ITM Trading, a precious metals broker. Lynette's specialty is diving deep into the documents assets and investments that most of us don't read. If you invest at all in stocks or the bond market, you NEED to view this video.

We discuss the major risks and issues with owning stocks through a regular broker, as well as what the bond market is telling us about the economy. We also discuss how to own precious metals as insurance, including which types of metals have the best overall risk protection.

We examine the real estate market and why owning a lot of real estate right now is a risk to your wealth because pressures are already happening on prices, and eventually will catch up to rental incomes.

You can find more fine research from Lynette at ITM Trading: https://www.itmtrading.com/blog/#

Find the full article on our website: 

https://goldsilverpros.com/2018/12/22...

Follow us on Twitter for the latest updates: https://twitter.com/GoldsilverP

Video Link: https://www.youtube.com/watch?v=lRbynxeeKns&t=6s

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Interview with CEO Ken Berry of Northern Vertex and their streaming deal with Maverix.

Find the original article on our website:

https://goldsilverpros.com/2018/12/22/breaking-down-the-maverix-deal-with-northern-vertex-ceo-kenneth-berry/

Follow us on Twitter:

https://twitter.com/GoldsilverP

Video Link:  https://www.youtube.com/watch?v=KcSocY1WOwc

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Free market research on the precious metals markets.