Weekend Show – Doc and Jesse Felder – A Technical Outlook Vs Fundamental Outlook
Welcome to June, where sentiment remains bearish and central banks around the world continue to hike rates. This is a bad environment for equities across the board which just showed us what a weak bear market rally looks like.
On this Weekend’s Show we feature Doc and Jesse Felder. While Doc stocks more to the chart Jesse like to take a big picture view. It’s interesting to hear what they agree on and what they see differently. Overall both are expecting lower prices for financial assets but some of the other sector commentary is a bit different.
Please keep in touch through email, we love hearing what you all think of the markets. our guests and the companies we interviewed over the week. Our email addresses are Fleck@kereport.com and Shad@kereport.com.
- Segment 1 and 2 – Richard Postma, AKA Doc shares his technical outlook for metals, US equity markets and interest rates. We recap the moves this month for each sector, the Gold Fields acquisition of Yamana and what stocks Doc is watching to forecast a rebound.
- Segment 3 and 4 – Jesse Felder, Founder of The Felder Report shares why he thinks the energy sector will remain strong and the potential of a capitulation event for the US markets. We also discuss the metals markets and why the underlying stocks continue to be washed out. Click here to learn more about The Felder Report.
Exclusive Company Interviews This Week
- Novo Resources – Recapping Recent Exploration And Operational Updates
- Exploits Discovery – This Year’s Exploration Focus At 3 Targets On The Appleton Fault in Newfoundland
- Metallic Minerals – High-Grade And Broad Intercept Drill Results From The Keno Silver Project
- Benchmark Metals – Recent Drill Results Expanding The New Marmot Zone Discovery And An Agreement Signed With The Tahltan Nation
- Mako Mining – Q1 2022 Financials And 2 New Veins Discovered At The San Pablo Zone
- Trigon Metals – Introducing This Copper Producer in Namibia, Expanding Production And Growing The Resource Through Exploration
- FPX Nickel – Phase 2 Drill Program At The Van Target, Including Wide Step-Outs Following Up On The Discovery Made Last Year
- Silver X Mining – Reviewing The April Operations At The Tangana Mine And Unpacking The New Resource Estimate That Triples The Size Of The Nueva Recuperada Project
- Awale Resources – Strategic Investment And Exploration Agreement With Newmont On The Odienné Project, Côte d’Ivoire
- Golden Shield Resources – Expanding The Mazoa Hill Area With High-Grade Results, Highlighted By 7.59g/t Gold over 31 Meters
- Superior Gold – Q1 Operations Review, Path Towards Production Expansion, And Exploration Update
Are Big Tech Stocks Following In The Footsteps Of Their Chinese Counterparts? Part Deux
Jesse Felder – June 1, 2022
“Back in January, I drew attention to the dramatic divergence between US and Chinese tech stocks. Over the course of 2021, the former soared while the latter crashed. The major difference, I argued at the time, was the divergence in monetary policy. In China, a tightening of the credit cycle led to a major reset in the valuations of big tech stocks in the country. Of course, a regulatory crackdown also played a major part in the process.”
“In contrast, here in the US the Federal Reserve was still pouring monetary fuel on the market fire, supporting risk appetites and thus valuations. That changed this year, with the Fed beginning to follow in the footstep of the Bank of China by embarking on a major tightening of monetary policy of its own. In addition, big tech stocks in the US also now face a major regulatory crackdown of their own, both here and in Europe.”
“The lesson that might be gleaned from China’s experience is that a reset in valuations for US tech stocks may not be complete until the Fed’s monetary tightening has first been completed. What’s more, it’s not just the “P” in the PE Ratio that must be considered but also the “E.” If valuations continue to revert to more normal levels AND earnings estimates continue to come down (as leading indicators suggest), then the decline in prices may have only just begun.”
‘Gold Could More Than Triple Against The S&P 500’
Jesse Felder – The Felder Report – (06/04/2022)
Great article linked in that composite of Jesse’s above:
________________________________________________________________________________________
Jerome Powell’s Volcker Deficit
Stephens S. Roach – May 25, 2022
“If the US Federal Reserve wishes to avoid a return to stagflation, it must recognize the huge gulf between the level of real interest rates under former Fed Chair Paul Volcker and the current incumbent. It is delusional to think that today’s wildly accommodative monetary policy can solve the worst inflation problem in a generation.”
Another Proposed Major Miner Merger Lifts the Gold Complex
David Erfle – Friday June 3rd, 2022
“As covid restrictions were being lifted, deal flow among gold miners increased significantly into late 2021 with the value of the top five gold mergers totaling $16.1bn. The volume of mergers and acquisitions (M&A) jumped last year as well, with the largest being the $10.6bn combination between Agnico Eagle Mines (AEM) and Kirkland Lake Gold announced in late September.”
“While there was a rush for deals directly following the announcement of this high-profile merger of equals, M&A activity slowed in the mining sector after Kinross Gold (KGC) forked out $1.4bn for Great Bear Resources in December. In fact, M&A deal flow had mostly dried up in the mining complex until this week.”
“On Tuesday, South African mining firm Gold Fields (GFI) announced a deal to buy Canada’s Yamana Gold (AUY) in a $6.7bn, all-share deal. The proposed combination would turn two senior gold miners into the world’s fourth largest producer.”
https://mailchi.mp/4eb91e1d08a9/david-erfle-weekly-gold-miner-sector-op-ed-1600974
Gold & Silver Stocks: Upside Blastoff Begins
Morris Hubbartt – June 3, 2022 – Super Force Precious Metals Video #TechnicalAnalysis
Ira Epstein’s Metals Video (06/02/2022)
#TechnicalAnalysis Gold, Silver, Copper, Platinum
Doc, where one is fully invested in mining shares, is it your opinion that one should hold here and not sell and try to get them a little cheaper? I am in no way in a hurry for them to rise and do not need the money and am inclined to hold and wait for the eventual rise in the share price. What is your opinion?
Pardu, in the situation you outline I would definitely hold and be very patient.
Lyn Alden – Risk Assets Will Have it Rough in 2022, Prudent to Play Defence
Jay Martin Show – May 28, 2022
“Investor and analyst Lyn Alden joins the show to discuss her views on the current turbulent economic environment and where she is currently putting her cash. Lyn emphasizes that investors are better served playing defence in these unpredictable markets where downside risk is very real.”
“Lyn also discusses the massive liquidity injection into the system and overpriced valuations of unprofitable tech stocks that occurred over the last few years, and how that will play a role in shaping the markets up ahead.”
Silver Forecast With Rick Rule, Jeffrey Christian, Jim Lewis, Jose Garcia
Jay Martin Show – May 31, 2022
00:00 Introduction
01:50 Consolidation and M&A in the Silver Sector
03:06 Silver’s Role in the Green Economy
07:54 Silver-to-Gold Ratio
09:12 Is Silver Still a Monetary Metal?
12:35 Silver Manipulation
18:12 Evaluating Silver Investments
19:32 Silver Price Prediction
22:00 Flood of New Silver Investors
25:23 Advice for New Silver Investors
Rick Rule, Jeff Clark, and Brent Cook’s Favorite Junior Mining Stocks
The Jay Martin Show – Jun 2, 2022
00:00 Introductions
01:38 Gold Bull Market
03:26 Jeff Clark’s Favorite Stocks
07:39 Brent Cook’s Favorite Stocks
09:31 Rick Rule’s Favorite Stocks
13:36 Importance of Management and Jurisdiction
14:32 Evaluating Drill Results
16:08 Surviving Long Term in the Market
I enjoyed listening to Rick and Jeff the most, the video’s that are posted here by Ex, are an important part of giving one a leg up in the markets. Thanks Ex, or should I add extraterrestrial! LOL! DT🐱🚀
Haha! Thanks DT. Yes, I thought that was an interesting Silver panel and some good comments by all 4 of them.
Rick R. typically lands solid points and I agreed with his points around the manipulation narrative, and Jeff C. had some good fundamental data in there on investment/financial demand numbers, and on solar panel demand vs the electric vehicle demand. It was nice to see Jose from Silver X up there on the panel, since we had just interviewed him here on the KER earlier in the week. There is a link to his interview up at the top under the weekend show description.
May everyone’s trading be out of this world 🛸🛰
Turns Table: https://tinyurl.com/mt2berap
Oil breakout. NatGas questinable.
Markets may have bottomed.
PM Top Tuesday?
Thanks for sharing your work BDC. Yes, Oil has been ripping again, and the general markets are seeing a nice relief rally the last few weeks. However, I’m still in the camp that after this rally in the general markets plays through, that there may be another corrective leg down.
As for the question about PMs topping on Tuesday…we’ll see, but many technicians are still bracing for another leg down in metals prices and mining stocks in the medium term, and both Jordan and Doc just made that case in their interviews this week. I’ve got my dry powder up to 5% now, but have considered trimming back a bit more in my PM positions just to take that up closer to 10%.
The issue I have is how bearish most people are towards the PMs at present, with several newsletter writers mentioning publicly they are out of resource stocks, or not putting new money to work, or building up record amounts of cash, etc… so it seems even the most bullish members have all packed up shop and are leaning more bearish (tied to concerns we may see a stock market rout that flushes everything down the drain). This uber bearish sentiment is likely what allowed many of the silver stocks to blast up double digits on Thursday in that big surge higher. I think we could see a number of days like that which catch a lot of investors out of position and chasing.
Even though it’s been a tough slog in the PMs the last 2 years, there have still been periods like Sept – Nov last year, or Dec -Mar where there were nice tradable rallies to capture, so I don’t want to be out of position for those periods, and find most investors missed out on those solid trades. I mentioned buying into the weakness before those pops and then trimming back some profits into the rallies.. which recouped back some losses from 2021, but apparently I should have taken far more off the table in March during the tail-end of that rally than I did.
The corrective move down from mid-April through May was very nasty and took my PM portfolio positions down by 1/3 in a pullback more steep than anything I’d experienced since the pandemic crash. Brutal…. I was not expecting that extreme of a pullback based on how well the underlying metals prices were hanging up.
At this point though most of the damage has been inflicted to the mining stocks. However, if some of the technicians are right about Gold heading back down into the low $1700’s or Silver going back down to $18.75 support, then I guess that would pummel the miners even further. Doc mentioned the juniors could still pullback by 15-20%, so that would be hard to hold through in companies that already took a 30-40% haircut, and he mentioned the mid-tiers still having more room to fall lower.
That scenario would be a real bummer so maybe I should lighten up a little more on my position sizing in PM stocks, but as a defensive strategy I’ve also rotated more funds over into the royalty names recently as they tend to pullback less in corrective moves than individual miners. Overall I still have a lot of allocations to individual PM mining stocks though, so it would be nice to see a rally that catches most people off-sides, and squeezes the overzealous shorts back to the upside.
This GFC seasonal chart may agree with Doc’s analysis (bullish version):
http://equityclock.com/pictures/GoldFuturesGCSeasonalChart_2CFE/image.png
Yes, that seems like a probable trajectory.
Hey, Ex… thanks for the links (as always) 🙂
Hey, DT… thanks for the metallurgy article link (last week) 🙂
Much appreciated MoldyOle, and yes just sharing links to news, interesting editorials, thought leaders, and technical analysis that may be of benefit for others to consider. Cheers!
P.S. – I agree that was a good link DT shared on the importance of metallurgy on last weekend’s show.
Current Market Situation !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! ?
Oh no, the dreaded bur!
I am a doubter. I understand how The American investor thinks, they look for precedents. Every downturn in the past few years has been followed by a recovery, and every recovery had brought prices to a new high point. They believe the really wise man is he who bought and held on. The speculative memory is short, they don’t study history. In the past say at least 100 years depressions were allowed to cleanse the system. That is what made America strong, the weak companies were left to disappear, something else would assume their business interests.
Meanwhile derivatives are multiplying like locusts. Nobody knows how badly these derivative companies are run. Bob M talked about this in a recent interview. Most of them must rely completely upon the hope of profits. When the market starts to turn down they will be swimming naked. Even professional analysts don’t know how they are financed and what their holdings are. In a downturn they will be like everyone else trying to sell securities that they only hold but don’t own and can no longer pay dividends on in a stock market collapse. It is easy to indulge in bad practices when the market goes up, but when there is a reckoning look out! DT
This will be worse than 2007-2008 housing collapse because commodity inflation will be higher than then due the government induced supply chain destruction.
I have little idea what will best preserve capital. US bonds, US dollars, Gold, Silver, Platinum, Oil, Gas, Beans, Newmont?
Dunkin Donuts card.
Cory – you asked Jesse why $’s were still flowing into passively managed funds – sadly that is easy. I work at a large place with lots of employees and the major funds in our 401K are all passively managed. I have no bond funds or no interesting actively managed funds to choose from. The two funds that most folks choose have serious overlap but they are still lapping them up because in the words of the thought leaders on CBNC the market always comes back!
I sometimes wonder if anybody has listened to a word Michael Green has said!
An interesting listen …….
How Silver Is Going To Be The New Lithium – Squeeze Certain | Chen Lin
https://www.youtube.com/watch?v=eTLGJ–a8AM
It turns out that just a bit more silver in a solar panel increases their efficiency by something like 5%.
So perhaps silver has more uses than most people realize.
P.S. — As a photographer and BW film lover the more silver the better! Happily Kodak has brought back Tri-X Pan 400 – I still miss Panatomic X. I also absolutely love Ferrania’s P30 when the Italians can get around to making it!
Hello Everybody. I hope You dont mind me posting this here , i posted it over on the Political page, but i believe what is going on in the west today , could have a detremental effect on your investing & trading. We are all up against the MACHINE.
irishtony
7 hours ago
This Is A Must Watch & Listen.
Neil Oliver… Perhaps the UK’s best modern Wordsmith. Neils work can be found at , GBNEWS.UK & on UTUBE…. ( how long he will last on Utube , is anyones guess ) . Its ten minutes long, but i would recomend you watch it twice. He speaks mainly about the British Isles , but what he has to say , applies equally to the US & every other Western Country.
irishtony – since you posted it here and praised Oliver I feel required to comment.
Oliver like Noam Chomsky is part of a group of Western Intellectuals that appear to delight in pointing out the faults of Western Governments will implicitly supporting monsters like Xi Jinping in China and Putin in Russia. Oliver has been called “an apologist for Russian fascism” and sadly I think that is fair.
From Wikipedia:
“Oliver was mocked on social media for stating on GB News that “I’ll be honest. I don’t know what’s happening in Ukraine. I don’t understand it either” before going on to give a 10-minute monologue on the subject, during which he stated “I do know that I don’t trust Putin, or our government, or Europe’s governments, or the governments of North America either. I certainly don’t trust any of them to tell the truth”. The Financial Times journalist Robert Shrimsley characterized Oliver’s monologue as “I don’t know what’s happening in Ukraine. I don’t understand it either. But here are my opinions anyway”.”
The fact that he would equate Putin with the British and/or US Government shows what a sick twisted monster he is. Certainly “our” governments have many faults but like Chomsky Oliver should choose where he would prefer to be.
Let me boil it down for you – folks like Oliver and Chomsky and the rest of that pseudo intellectual crowd so hate the West that they can’t see who and what Putin and Jiping are and are perfectly willing to subjugate the Ukrainians and Wiegers to the tender mercies of these monsters. To make matters worse they are doing it to tickle their own sick fantasies fueled by self hate and loathing. I once though well of Chomsky but now see him as a failed old man searching for relevance in a world his prejudices can allow him to comprehend. Oliver is simply a self important bag of wind that deserves our contempt.
Hello Mike. I posted the above , as i believe what He, Neil had to say, can have a relevent impact on how peoples investing & trades can be affected by some who have a huge inpact on the markets, As a sign of respect for Shad, i will not debate the political angle on this page, we have the political page for that , but thank You for Your reply…………. tony.
Putin literally murdered and permanently maimed thousands of a peaceful society including thousands of children permanently displaced and orphaned.
NO ONE made him do it. On the eve of his invasion he was still claiming that the mass of troops on the border was not for an intended invasion.
Putin is a psychotic killer, he has shown this over and over, no different from Hitler, Stalin and many others in history. Yet, to gain readership, following or relevance, slimes like Chomshy, Oliver and Tucker posted their hate porn in the hope the dimwits of the world will propogate it. And voila, we then have a debate, which in of itself marginalizes the suffering these victims endure each and every day.
For anyone to justify posting this diatribe as it has impact on markets is beyond stupid. It’s to progogate their own relevance.
Thanks for taking the high road IrishT and refraining from responding back about all the politics here on the economic blog. It is greatly appreciated as we really want this forum more focused on the economic topics, or at least how geopolitics affects the markets and finances.
Yes, we do, in fact, have a political page here at the KER for people to debate their personal opinions on polarizing topics like this and many more, and it really is the more appropriate forum. People can just click on the politics tab at the top and it takes you over to that page where folks can rant from their perspectives on all things political or regarding the social culture wars.
It is all related……………… sorry to say……….. Political and Money…… Money and Gold…….
Some of the policy decisions that affect supply/demand, trade, currencies, or the larger geopolitical effects are related OOTB, but much of the back on forth on polarizing political opinion subjects and the culture wars really don’t add to the economic discussions or investing theme of this blog and are best-suited for the politics blog.
John Rubino – Monetary Reset: What To Expect
Liberty & Finance – June 4th, 2022
0:00 Intro
2:24 Economic pessimism
5:55 Fed policy
12:54 Inflation
16:23 Preparedness
20:26 Real Estate
23:05 Dedollarization
26:34 DollarCollapse.com
Did John sell out his interest in Dollar Collapse..?.. interesting comments at the end of the tape…….
Yes, John sold the DollarCollapse website to different folks (the new team is doing a hybrid PMs/crypto theme now). He has mostly retired at this point but still is doing interviews with outlets, like Liberty & Finance and here at the KE Report. We’ll actually be speaking with John tomorrow so stay tuned…
Thanks……….
Here was our last interview with John from 2 weeks ago for anyone that missed it.
This discussion with John Rubino from May 11th was also very insightful and covered a lot of markets:
thanks for the additional info………….
Andrew Gilbert: Don’t Fight the Fed
Palisades Radio w/ Tom Bodrovics – June 2, 2022
“Tom welcomes Andrew Gilbert back to the show to discuss the markets. Andrew is the Founder & Lead Technical Analyst of Sniper Trading.”
“Andrew discusses the effects of the Fed on the markets and how tightening is creating capitulation events in equities. The Fed affects the volatility while remaining the godfather of the markets. Markets are likely to stay volatile, and only lower is where we are heading until the Fed starts adding liquidity.”
“We’re in a short-covering rally where institutions clear out positions. Institutions are taking profits, and we’re likely to see this rally run out of steam. Andrew compares the current markets with those of the 1970s. We’re seeing similar market structures. Expect another break to the downside.”
“It will be interesting to see how committed Powell remains and when they will choose to pivot. We might see action at the thirty percent correction level based on past actions. The pivot will likely depend on the inflation numbers.”
David Brady: The Dollar is Scheduled for Demolition
Palisades Radio w/ Tom Bodrovics – June 1, 2022
“Tom welcomes back David Brady, CEO, and Co-Founder of Global Pro Traders. David discusses the changes that have occurred in the markets since his last appearance on the show nearly two years ago. He believes another massive rally is coming for gold and that the Fed will reverse course. Countries never chose to default they always inflate their debts away. Markets today are centrally managed. What we have is not free-market capitalism. ”
“The Fed appears to be engineering a recession to curb inflation. Unemployment is far higher than we are being told and we see that reflected in the credit card use. Demand is starting to drop, and many people are down to just buying essentials. This is why we’re going to see dis-inflation. Prices for everything going up at once is not indicative of supply chain issues. More money is simply chasing fewer goods. We have supply chain issues mixed with money printing.”
“He expects the Fed to reverse policy and resume stimulus which will result in a final melt-up. At some point, the Fed’s stimulus will be insufficient to prevent a crash. We’ve had an orderly sell-off recently in stocks, but what is coming will likely be a flash crash. ”
David Hunter: Stock Market Melt-up To Be Followed By A Major Financial Crisis
Small Caps – June 1, 2022
I believe he’s the one that’s been calling for new highs in the stock market. If so, he’s likely in for an unpleasant surprise.
Yeah, David Hunter seems to think there may be one more melt-up in the general markets when the Fed eventually pivots and reverses course on their hikes, but that after that next blowoff top, he sees the main indexes falling by 80%.
I’m not really in agreement with his personal outlook, but think it’s an interesting path to consider from a possibility standpoint… just not a probability standpoint. What seems more probable is that we already saw the blowoff top in the markets from late 2020 through late 2021, depending on the individual sectors.
That was an extremely frothy speculative period where no-earnings junk tech companies continued to rally into the stratosphere on pie-in-the-sky views of growth forever. There were so many growth company Unicorns launched that were impaled on their horns as time went by, and so many SPACs that turned out just to be whacks.
We saw “stay at home stocks” pumped way beyond rational expectations to ridiculous levels based on pandemic mania, and then they crashed back down to Earth when reality set in. In that period of perpetual “buy the dip” hubris, even left-for-dead companies like Hertz, AMC, Gamestop, Blackberry, and Bed Bath and Beyond were latched onto by the “meme stocks” throngs on Reddit & Robinhood & WeBull & Stash and became purely speculative momo trades (to the upside and then downside).
We saw unbridled gushing about all things digital – Cryptos and DeFi companies and NFTs, where it didn’t matter if there was intrinsic underlying value because these things can only go up… right? It reminded me a lot of the Crypto Kitties tradable cartoon cats that hatched out of eggs which were trading for multiple thousands of dollars in 2017 before that Crypto meltdown from $19K to $3k in just a few months.
Even the sector “leaders” like the FAANGS or Tesla reached valuations that made no rational sense, and when we asked generalist fund managers about them, their canned response was “don’t fight the trend” or the “price is primary” and the “market is always right.” I guess those same idioms would apply today then, about the trend, the price, and the market being right after so many tech stocks are now down 40%-80%.
By all indications, that WAS the blow-off top from 2020 into 2021, and really by the 3rd and 4th quarters of last year, the cracks were already growing, and the underlying market breadth and companies making new 52 weeks lows were already telling the tale. Many stocks and certain sectors had already started pulling back hard by the 3rd and 4th quarters, and by November even the last strongholds in the general markets had put in their highs and were trending lower.
When people have just been using the calendar start to 2022 as when the correction started as only 5-6 months ago, they fail to understand that the top in the markets was further back than that in the last half of 2021 depending on the sector and stocks in focus, and we were already in the correction last year, before ever turning the page into 2022.
Even when the so-called “January Effect” showed even further weakness and follow-through from the year before, many generalists we spoke with, and in the main-stream financial media, failed to accept defeat and waive the white flag, choosing instead to hold onto their stonks and keep buying that dip, only to get smacked even harder.
So I guess it’s possible that maybe these generalist 1-way traders may not have learned their lessons yet, and maybe David could be right that we see even one more crazy speculative move even higher…. but that seems quite dubious to me. In my mind, he is minimizing just how many investors got their clocks cleaned in the general markets in all those speculative value traps over the last year. Even now when we are starting to see many main-stream financial outlets claim the worst is behind us and that the new leg higher has begun, they forget just how much capital was actually vaporized and went to money heaven.
We’ve seen reports that over half of people HODLing cryptos are currently underwater in their trades, so where is there extra money going to come from?
The “meme-stock” momo traders got destroyed in options trading, openly admitting to not caring if they lost money because they were “sticking it to the fat cats in the hedge funds” and it was a moral crusade for them… but that money got obliterated over the last year.
All the genius investors playing the “stay at home stocks” and “reopening trade stocks” just got their tail-ends handed to them over the last 6-12 months, and they aren’t going to be nearly so cavalier with their speculations moving forward.
Heck, the only sectors that have even done well the last year or so are the defensive sectors with nice dividend yields like Utilities, Energy, Consumer Staples, and Healthcare, and even those (excluding energy of course) have suffered recently.
We’ve seen a nice relief rally (dead cat bounce) in the general markets over the last 3-4 weeks and so there may be some money on the sidelines that comes back in and pushes things a bit higher, and if the Fed does eventually pivot by Sept/Oct and pause the rate hikes, then maybe the general markets could rally on that news, but it is most probable that the markets rally up to key resistance and then get swatted back down for a retest of the lows, or worse, the next big move lower.
Most economic-minded guests we’ve been talking to and even some of the main stream financial media pundits are coming around to the realization that this is what a real protracted and more orderly correction looks like (not just a flash crash) and we are likely still in the front part of it, with 1-2 more years of struggles to go.
It won’t be a straight down move though, and there will be relief rallies, just like when any sector corrects, and the “buy the dip” strategy (ingrained into so many traders minds as the only strategy that matters) for the last dozen years, will be an idea that dies hard.
With the pricing pressures eating into companies revenues and consumers wallets, with more people switching to living off credit, with so many small businesses decimated by the events of the last 2 years, and with so much investing capital that was lit on fire and destroyed over the last 12 months, it’s hard to imagine that there is one more speculative bubble waiting to be blown in the medium-term.
That doesn’t mean the central banksters won’t try to reflate things one more time and reliquify the markets, but this time all the Treasury Secretary’s horses and all the Fed’s minions won’t be able to put these Humpty Dumpty markets back together again.
I think he is right that gold has to go to $3000 and silver has to go to $50
Rick Rule would say that is not an if question that is a when question
David might be wrong on the timing, next three months a melt up of 50% and then 12 months in 2023 the big melt down of 80%
Yeah, I generally agree with that timeline, but just think it will be more of a dead-cat bounce (up another 20%) more so than a true melt up to obscene heights again, and maybe not that severe of a corrective move (maybe down about 20%-40%, but I’m not sure about as much as 80%). In general though, I believe we’ll see a bounce higher, then another leg to test the lows and/or make new lows by a Fib retracement of roughly 23.6% or 38.2%.
Yes, in the fullness of time 2-3 years, $3000 gold and $50 silver seem quite rational.
“…in the fullness of time.” ~ Shades of an FNN host from the 1980s!
Haha! Good one BDC. Cheers mate!
Kerry seems to make quite good interviews. Here is another one with Doug Casey
Doug’s advice: Wild times are ahead. Learn to be a speculator
Must be the perfect time for speculators like you ex 🙂
Haha! I’m speculating that you are correct on that Thomas. 🙂
Yes, in all actuality, the more volatility and whipsaw action we see in the markets, the better for trading that action, and with the low resource stock prices and high degree of market uncertainty on the horizon, it is a speculators dream scenario. Over the next 12-18 months, speculators with the conviction of their thesis in resource stocks should be pretty happy about where things trend. Cheers!
Gold forecast!
Just wanted to share my target number for what I believe to be a big monthly green candle for June. Since I have been beating the drum in this for sometime, I’m expecting $1978-$1983 closing monthly candle. To be precise I would say $1981..
If it goes above it great if we fall way short I will still look at it as a bullish scenario which would mean July would be more explosive..
The hope would be for the miners to go higher under this scenario lol. In all my investing career I’ve never seen the miners go this down while everything else went up including oil and other commodities. Some charts look distorted and played with and I’m not a conspiracy guy but but..
When this thing releases look out
Thanks for sharing your technical outlook Glenfidish, and a monthly close in June gold to $1981 would be a nice green candle indeed. Cheers!
ditto Glen……….. when it releases “look out”………..
Being in the markets now is like dancing with the devil and he has all the cards but he won’t tell you when his hand will be played and so the game goes on. The trick is to get as much out of this last upswing and hold cash before the number “666” shows up! DT
If you flip over the following XAU:CRB chart you can see what might be a weak little blow-off top (a top in commodities versus gold/silver miners). We will know soon if it has completed.
https://stockcharts.com/h-sc/ui?s=%24XAU%3A%24CRB&p=W&yr=7&mn=6&dy=0&id=t7708193315c&a=1049932839&r=1654455735206&cmd=print
Adam Hamilton knows exactly what and who is responsible for all this inflation. Those who believe officialdom and CNN, etc., are fools, to put it nicely…
“The Fed just executed its most-extreme policy shift ever in its century-plus history! Back in March 2020 the S&P 500 plummeted 33.9% in just over a month, in a full-blown stock panic over pandemic-lockdown fears. Dreading a resulting economic depression, Fed officials freaked out. Their Federal Open Market Committee slammed its federal-funds rate to zero, and redlined its monetary printing presses to crazy extremes.
The Fed kept that zero-interest-rate policy in place until mid-March 2022, when it launched a new rate-hike cycle. Way more importantly, the Fed also ballooned its balance sheet by an insane 115.6% or $4,807b over just 25.5 months into mid-April 2022! Effectively more than doubling the US monetary base in just a couple years, that radically-unprecedented quantitative easing spawned today’s raging inflation.”
https://goldseek.com/article/fed-reloads-gold-stocks
+1
There are a few of the KER crew that follow or trade Santacruz Silver. It’s one I’ve had a nice weighting in for the last few years and that I swing-trade around the core position.
Here’s an interesting chart posted by The Last Degree recently to the Twitterverse…
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Gold Ventures @TheLastDegree 6:44 AM · Jun 2, 2022·Twitter
“$SCZ.v $SZSMF – it’s the only midtier trading at the valuation of a junior.”
“my pos #6 in the silver portfolio”
https://twitter.com/TheLastDegree/status/1532357399864037381
Graddhy – Commodities TA+Cycles @graddhybpc 12:21 PM · Jun 1, 2022 ·Twitter
“One of our favourite #preciousmetals companies at the service. @SantacruzSilver $SCZ.V $SZSMF ”
“Great Q1 report yesterday, first that includes its acquisition of Glencore’s producing Bolivian assets. One of the very best resource acquisitions I have ever seen. Huge growth. ”
https://mobile.twitter.com/graddhybpc/status/1532080027864825856
We mentioned over a year ago, when the Fed announced they were going to phase down or “taper” their existing accommodative QE $120 billion a month of bond purchases, that the interest rates for the 2 year, 10 year, and 30 year treasuries would be rising because the central banksters had been such a heavy hand in buying the bonds.
I personally asked about a dozen people we interviewed “When the Fed stops buying all those bonds, who in the world is going to buy those bonds?” The point being that when people factored for inflation even getting less than 1% at the time up to 3% today is still a losing proposition when inflation was 4% to now over 8%. We were told, “Don’t worry about that, foreign investors will want them…” (OK? Well, where have all those international buyers been then for the last year? Crickets…)
We also mentioned that with the 10 year yield getting down below 40 basis points in August of 2020 (almost 2 years ago now), that this likely marked the top of the bond bubble. When we had mentioned that was the bond bubble popping, the generalist die-hard’s response was…. “Oh, come on. People have been calling for the top in the bond market for 4 decades now, and how has that worked out for them?”
Well, my response back to them now would be, “Have you seen the 10-year yields going lower or higher over the last 2 years?” “Well, how has that worked out for bond investors?”
Obviously, the lowest treasury yields on record 2 years ago (down to near zero levels) corresponded with the highest value for bonds…. EVER, and it absolutely marked the top for bonds for the last 2 years as mentioned it likely would. Old ideas die hard. Sure, we are seeing a short-term bounce in bonds from their oversold levels, but the 10 year and 30 year are up bigly in percentage terms from where they were trading in the summer of 2020 just 2 years ago.
One last point we have brought up about a dozen times since last year is what this bond bubble bursting would mean for the typical 60/40 (60% stocks / 40% bonds) allocation and retirement investing approach? I submitted an article here on the KE Report over a year ago pointing out “The Great Rotation Out Of Bonds And Into Gold” where I surmised there would be a mass exodus out of bonds, and that this money would rotate out into other sectors for a safe haven – mainly defensive dividend stocks, the US Dollar, and Gold. Well, we’ve pretty much seen that play out over the last year, only more so to the defensive stocks like Utilities and Consumer Staples and Energy stocks with good dividend yields and the US Dollar, but Gold has also held it’s own, and did run to over $2000 again in March.
I’ve asked a number of our guests about this rotation out of Bonds and how this would affect the classic 60/40 investing model for a year and half now, especially since the Fed announced they’d begin their tapering program, and some initially felt it was too soon to start suggesting that was going to change. However, as rates have crept higher and higher even some of our KER guests (like Rick Bensignor, Jesse Felder, Dana Lyons, Craig Hemke, and John Rubino) have also mentioned that the age of the 60/40 allocation to stocks and bonds was over.
Finally this point about the great rotation out of bonds is starting to resonate with more and more investors, but again, after decades of using the same strategy, most modern financial planners and retirement investing coaches are having to cope with a paradigm change in the world they’ve always known. None of this should be a surprise if any of them spent 5 minutes thinking things through a year or two ago, and really it is stunning (but not really) how long so many other main-stream generalist investors are taking to wake up and realize that old investing paradigm, where bonds always go up and rates always come down over time has changed. Now there are new rules for what is considered a safe haven. Surprise surprise…
Regardless, here is an article reporting back on a trend that we’ve been on top of for over a year now, and the lights are just now going on for traditional generalist investors. Welcome to the world without the Fed intervening in the bond markets… (at least for now…).
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60-40 Investors ‘Punched In The Gut’ So Far In 2022, But Strategist Sees Hope
Julie Hyman – Sun, June 5, 2022
“Investors who own a 60-40 balanced portfolio just feel like they’ve been punched in the gut,” Emily Roland, co-chief investment officer at John Hancock Investment Management, said on Yahoo Finance Live (video above), adding that year-to-date so far it’s down about 10%.
“A 60-40 portfolio consists of 60% equities and 40% bonds or other fixed-income offerings. Stock and bond prices historically move inversely. That hasn’t happened this year, plotting a rough ride for the classic 60-40 portfolio, which is meant to insulate investors during volatile times — but there’s been volatility in both markets.”
Consumers Have To Face That Nasty Inflation Is Here To Stay For A While
Brian Sozzi · Yahoo Finance Editor-at-Large – Mon, June 6, 2022
“It’s a very challenging time right now with inflation,” U.S. Labor Secretary Marty Walsh told Yahoo Finance Live on Friday (video above).
“Indeed, and the reality is nasty inflation is here to stay at least into 2023. Sure, we could get the mild recession some policymakers seem to want, and inflation may cool down as a result, but don’t expect prices to pullback to levels you once deemed reasonable. If you want a new pair of jeans, as Levi’s CFO Harmit Singh told me recently, buy them now.”
Another Monday of some up and some down. Bitterroot, Nevada Sunrise and Southern Silver having good start. Emerita not but that is everyday at open.
Intervention began in the Paper Fraudulent Metals Markets at about 8:30 EST. Check investing.com charts. Nothing new.
All 30 of mine got their “assigned price” early and held about that price all day.
Couldn’t agree more with Doc’s assessment across the board from a Technical outlook. We are already in Recession as well. Once this countertrend rally concludes/ exhaust’s itself targets are as follows:
SPX. 3400
DJIA. 29750
NDQ. 9750
BTC. 12,000
Looking for these levels to be met / achieved prior to year end. Any and all green should be utilized for lightening up and preserving your Coin to be redeployed at a later date.
It’s worth keeping in mind that following the 2000 top in stocks, the XAU bottomed after QQQ fell 39%. The interesting thing is that QQQ was still 2 years away from its final low and would fall another 73% to get there (for a total drop of over 83%).
The bottom line is the XAU gained 113% while QQQ fell another 63% after its initial 39% drop so those expecting the miners to go lower as long as stocks go lower might be in for a big surprise. In my opinion, another such decoupling is probable and might’ve already begun.
https://stockcharts.com/h-sc/ui?s=%24XAU&p=W&st=1999-06-03&en=2003-10-26&id=p40738985353&a=1180350084
Thanks to all the KER guest contributors for another great week of daily editorials, company interviews with management, and another solid weekend show with Doc and Jesse.
Also thanks to all the listeners of the podcast and radio show, and those members of the KER crew that post and participate here on the blog, sharing insights with our community. Ever Upward!