Gold's Strength Amid a Crisis of Confidence | Metals Mine

  • Gold's Strength Amid a Crisis of Confidence

    From sprott.com

    For the quarter ending March 31, spot gold soared $499.07/oz (or +19.02%) to close at $3,123.57, decisively clearing the psychological $3,000 level and hitting an all-time high. Since the start of the year, gold has been climbing steadily with only minor, very short-lived pullbacks. The torrent of macro headlines and developments — coupled with a notable non-performance of traditional safe-haven assets such as the US dollar and US Treasuries — has led gold to emerge as the lone liquid safe-haven asset. The year began with broad market optimism. Investors had high expectations that the second Trump ... (full story)

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Trader#2587
Apr 5, 2025 1:36pm
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This is a period when one wants to start accumulating physical Gold and Silver if you haven't already. However, one first have to understand what makes the price of Gold and Silver rise or fall.

Let's cover this now.

The problem with accepting facts without doing your own research is that these facts, even if they are sometimes ackowledged around the world, can be faulty.

Correlation between Fed's interest rates and Gold/Silver. While it is considered as a fact that when interest rates are rising the price of Gold/Silver is supposed to fall, it is absolutely wrong. Whether you are looking at yields or Fed's interest rates, there is absolutely no correlation between the two.

Inflation and Gold/Silver as well have absolutely no correlation whatsoever. During GFC one can see that even though inflation rate was actually negative, the price of Gold/Silver was surging higher.

This leaves us a little bit confused. Two beliefs that many people around the world share and have accepted as facts are in fact totally wrong.

High risk. Now, this one while it seems to be true and highly correlated with the price of Gold/Silver going up, it is not the risk that is responsible for the price of Gold/Silver going up, rather something that is taking place during this high risk phase. Something else is taking place in the background and while on the surface it seems obvious when mentioned, it always seems to slip the attention of people.

So, GFC. Now, one will need to open up the charts of Gold and Silver. Find November of 2008.
You know what took place in November of 2008.? Exactly! Quantitative Easing 1!

In other words, while the Fed is still not officially in the QE phase this is your chance now to acquire physical Gold and Silver before the Fed abandons the QT and starts the real QE which will push the price of both Gold and Silver to the heights that will spin people's head around. This is now a perfect period to do so. We could be seeing both Gold and Silver price dropping during this period now, and that is the chance we've been waiting for.

You might still be wondering... but why did the price of Gold/Silver go up the last couple of years if the QE is still not on? Well, this ties in to that high risk I was mentioning above. You see, it is not the high risk that pushed the price of Gold/Silver up, but war. Well, not war... think for a moment! Yes... you're almost there! Answer: Fed printed billions and billions and billions of dollars during this time for the war in Ukraine and the war in the Middle-East which propelled the price of Gold/Silver higher. Granted, Silver seems to lag way behind Gold and this is almost always the case. However, Silver always does catch up eventually.

You want to buy physical Gold and Silver before the Fed announces QE! This period could prove amazing for doing just that, as the price of Silver already dropped substantially and even lower price is possible.

Take care folks! Happy stacking!
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