#Silver leading #Gold seems to be key for #mining #stocks

Silver usually outperforms gold when economic growth and/or inflation rise.

When this is the case, gold mining stocks usually rise too.

There are few exceptions, like the 1997-2003 period.

Maybe it has something to do with the purchase of almost 3500 tons of silver by Warren Buffet’s company Berkshire Hathaway starting in 1997.

First graph is the relation between Gold and Real Interest Rates

Then the Barron’s Gold Mining Index

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Sell the techs and buy the miners a good idea ?

As a start, here is the evolution of Nasdaq compared to the Dow Jones Industrial

Then the ratio of the first one compared to the other

We are near the 2000 level

We can notice that the Nasdaq (growth values) is strongly influenced by interest rates.

Recently, rates have been rising, which seems to have a negative impact on the evolution of the Nasdaq

If you compare technos to mining, the graph cannot be ruled

Further, we can compare the evolution of “gold” mining stocks with their underlying.

As some like to say: “The Mining companies are in the cellar”!

With the risk of repeating it again and again (timing is the most difficult), I find hard to understand that you can buy a tech co with 50 years of profits (even if it shows growth) and sell what integrates value (for example, companies with a tangible assets worth 500 million quoting in the market barely 100 million or – another example – a company that has a p/e of 5 offering a dividend yield of 2.5%. Yes you can find them ! 10x cheaper than a tech at 50)

go figure !

Do not hesitate to contact me if you would like some gold stocks ideas and do not forget to read my disclaimer about investments

Happy Investing

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Vidéo : The Largest #Gold And #Copper Deposit In The World

Une vidéo incroyable (en anglais) d’une des plus grandes mines du monde. Celle-ci est la propriété de Freeport Mac Moran et se situe en Indonésie.

La mine de Grasberg : https://fr.wikipedia.org/wiki/Mine_de_Grasberg

À plus de 4000 mètres d'altitude, dans les jungles reculées de la Nouvelle-Guinée se trouve le plus grand gisement d'or et de cuivre au monde. Arriver à ce gisement et construire une mine rentable a été l'un des plus grands défis d'ingénierie de tous les temps. En 1975, une société minière américaine a relevé le défi et, utilisant la technologie la plus sophistiquée disponible, a conquis la jungle et construit la mine de Grasberg !
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#Gold and the US #dollar: The closing of the gold window in 1971

50 years ago, on August 15, President Richard Nixon closed the “gold window”. It was a “temporary” measure according to what he said on TV this Sunday. With governments, temporary has a very different meaning…

Nixon was forced to do that: The US had printed too much dollars and had not enough gold to redeem all the foreign-held greenbacks.

Have a look at this hereafter chart and you’ll get it immediately.

We are in a pure fiat monetary system since then. Nothing backs the US dollar (or other currencies) except some “confidence”.

The US, supposedly, still have 8,135 tons of gold. The US government refused to audit the gold since 1953. Surprise, surprise…

And in the mean time China is claiming to have more than 14,000 tons : https://goldbroker.com/news/china-gold-reserves-scale-up-for-15-consecutive-years-by-2020-2451

both should be audited

Follow me on Twitter too :  https://twitter.com/crofin67?lang=fr

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#DowJones vs #gold

Without dividends, taxes and expenses…

Happy 50 debasement birthday !

And Inflation (transitory or permanent ?)

As already said real interest rates are key ! (reminder : https://www.crottaz-finance.ch/blog/les-taux-montent-mais-quen-est-il-des-taux-reels/)

Source: https://tradingeconomics.com (thanks to zerte for the table)

And on a long run

Happy Inflating

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Commodities and precious metals (versus US stock markets) make a new 100 YEAR low

Amazing ! This is the only word I can tell today.

Despite increase in commodities prices, the GSCI commodity index cannot fight (till now) the skyrocketing US stock market.

I would like to mention that the biggest wheight in this index is Oil : https://en.wikipedia.org/wiki/S%26P_GSCI

And oil went up recently.

But if we compare this commodity index to the US stock market, this is what we see

First graph vs the DJ index

source : https://blog.gorozen.com/blog/commodities-at-a-100-year-low-valuation

And vs the SP500

Thanks to Willem Middelkoop for the graph

As already many times said, the stock market seems overvalued !

And the best of is : Precious metals vs commodities index ! If Commodities are low let me show you how low are the precious metals (thanks Crescat)

it is clearly a strong buy !

happy Investing

You can follow me on Twitter : https://twitter.com/crofin67?lang=fr

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Golden Flash Crash (english version)

At the opening of the commodity market, gold has been under a major attack.

In 2015, I told you about a violent downward opening (1050 USD per ounce) and then confirmed the increase to come when the price was still at 1300 (https://www.crottaz-finance.ch/blog/cest-parti-goldy-cest-reparti-goldy/)

What happened this morning very strongly looks like a “cleaning” of stop losses and “weak hands”.

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#gold #silver #Miners 52 weeks low all around, buying opportunity !

As Bob Moriarty (321gold) likes to say : “These are the two best times of the year to buy junior resource stocks”

He is meaning in summer (now) or during the tax loss period end of year.

Today we are facing a lot of 52 weeks lot (despite gold still around 1800 USD not far from long term top (see above)).

You can find at the bottom of that article a bunch of 52w low alerts I got.

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About gold value

Is Gold too expensive ?

For sure your banker will answer !

Too expensive compared to what ?

Should be your next question

Hereafter two graphs representing gold price (in USD) compared to the US M1 and M2 money supply (https://en.wikipedia.org/wiki/Money_supply)

Is Gold too expensive in your eyes ?

In addition of direct physical gold purchase (avoid not gold backed ETF) you can buy some gold mines. Producers, Developers or Explorers.

If you are interested, I can provide you some interesting names.

Do not hesitate to contact me if you would like some gold stocks ideas (do not forget to read my disclaimer)

You can follow me on Twitter : https://twitter.com/crofin67?lang=fr

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Long term #gold, #silver and #mining co

A short article with several long term graphs.

First one: Gold

Second One : Silver

Third one : Gold / silver ratio. The recent silver run (and gold pullback) brought the ratio back to the 70s

Number 4 : The Barron’s gold Mining index is back up but still did not break the 2011 top.

The last one (and probably the most important to me) : The Barron’s Gold Mining index divided by the gold price.

It shows you how cheap mining companies are !

Happy Investing

Do not hesitate to contact me if you would like some gold stocks ideas (do not forget to read my disclaimer)

You can follow me on Twitter : https://twitter.com/crofin67?lang=fr

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Major currencies vs #Gold over time

The year 2020 is now behind us, please find a graph showing the loss of value of the major currencies against gold over time.

This is probably a chart that no Central Bank will produce.

The Swiss Franc, the less worst currency in the world, has lost 93.6% of its value during the last 120 years.

The German Mark (now Euro), fell and reached twice ZERO during this period.

From 1948, It is the less bad currency with a loss versus gold at around 95.5%.

As for the American Dollar (USD), first reserve currency, its loss of value reaches 98.9%.

Who is saying that gold is babarous relic ? Who is saying that gold is not a safe haven ? Who is saying gold is not a currency ?

But the final question remains : “How to preserve your purchasing power over time ?”

Then Buy Gold or at minimum gold stocks.

Do not hesitate to contact me if you would like some gold stocks ideas

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Are #banks in trouble ?

Markets are near their historical tops and gold too.

But banks are still lagging and it has been lasting for years.

Could be a global solvency problem, Mr U. is telling me.

We will go through a depression (way too much debt, 331% of World GDP according to latest figures from the IIF). 
May be depression will be deflationary at first, and maybe/probably we’ll have hyperinflation later (currencies losing all of their value).
The all system is at risk. Be very careful with your money.

Charts are monthly, last data July 24, 2020.

European banks:

US banks

More recent data (a week old) of the Price to Book Value Ratio on a few banks:

  • Banque Cantonale Vaudoise : 2.28 (good)
  • Vontobel : 2.26 (good)
  • Julius Baer : 1.52 (ok)
  • Credit Suisse : 0.57 (not good)
  • Deutsche Bank : 0.30 (very bad)
  • Commerzbank : 0.20 (very bad)
  • ABN Amro : 0.19 (very bad)
  • BNP Paribas : 0.45 (bad)
  • Crédit Agricole : 0.42 (bad)
  • Société Générale : 0.21 (very bad)

Good Luck

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History of world currencies vs gold

From 1900 to the end of 2019, all currencies lost their value relative to gold.

The British Pound lost 99.63% and the US dollar 98.64%. Even worse, for the Japanese Yen and the French Franc.

The German currency lost its value completely twice and is about to go for a third time !

The German Mark called the Goldmark (backed by gold) was introduced in 1873. With the outbreak of World War I, the Mark was taken off the gold standard and became the Papiermark and briefly the Rentenmark in 1923.

The German currency lost all of its value.

From 1924, a new currency appeared, the Reichsmark. The German currency also lost all of its value and disappeared in 1945.

In 1948, a new currency appeared, the Deutsche Mark. In 1999, this currency became the Euro (at a rate of 1.95583 DM for one €). The German currency will probably lose all of its value for the third time. So far, it has lost 94.9% of its value relative to gold.

What about the Swiss Franc, the strongest currency in the world? 

The mighty Swiss Franc has lost 92.69% of its value relative to gold during the period 1900-2019.

So, gold, the “barbarous relic” has proven to be really useful to keep the purchasing power over the years.

All my english articles : https://www.crottaz-finance.ch/blog/category/english/

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Scary SP500

In January 2020, I wrote an article to you that suggested  to sell the SP500 and buy gold and gold mines.

The US equity market plunged sharply thereafter (March), mining stocks too and gold briefly. Today, after the huge rebound in the American market from the lows, what is the situation?

  • The SP500 is at – 4.1% (after a collapse of -35%)
  • Mining stocks (GDX) are at + 14.2%
  • Gold is + 7.9%

Sometimes graphics speak more than words. Below find 3 graphics that are really scary for those who remain invested in the SP500.

The Put / Call ratio is at the lowest of the lowest

Many of the stocks in the SP500 have an RSI above 70 ( overbought level), the number of stocks above their 50-day moving averages is at its highest in 20 years and it is the biggest upward rally in the market. ‘history.

Small traders bought calls like never before (very bad sign for a continuation of the rise)

This last graph makes me think of the abbreviation FOMO (Fear of Missing Opportunity) which is the fact of buying at any price for fear of missing the increase.

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Hyperinflation in Venezuela

In case of hyperinflation, which is a loss of confidence in the currency, nothing will protect your purchasing power better than precious metals.

Thanks to my friend H., we can just have a look at Venezuela. The country went from one Bolivar to another one : The Bolivar, to the Bolivar fuerte in 2008 (at the rate of 1 for 1,000) and to the Bolivar soberano in August 2018 (at the rate of 1 for 100,000).

The purchasing power of the currency is plunging, collapsing

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CRB index is at the lowest level

Here is a long term chart (1914 – today)of the CRB Index (end of month) (LOG).

It represents a basket of 19 different commodities. Agricultural products and energy account for 80% of it and metals 20%.

We are approaching a major low so the end of the commodities bear market. Low prices are destroying supplies so when the current recession/depression will end, this index will start a new bull market.
Time to put commodities producers on your radar so you know in advance what to buy when it will be time to do so.

Elliott Wave Analysis (made by one of my closest friend Mr H., thanks to him)

Happy Investing

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