Best of the Week
Most Popular
1. US Housing Market Real Estate Crash The Next Shoe To Drop – Part II - Chris_Vermeulen
2.The Coronavirus Greatest Economic Depression in History? - Nadeem_Walayat
3.US Real Estate Housing Market Crash Is The Next Shoe To Drop - Chris_Vermeulen
4.Coronavirus Stock Market Trend Implications and AI Mega-trend Stocks Buying Levels - Nadeem_Walayat
5. Are Coronavirus Death Statistics Exaggerated? Worse than Seasonal Flu or Not?- Nadeem_Walayat
6.Coronavirus Stock Market Trend Implications, Global Recession and AI Stocks Buying Levels - Nadeem_Walayat
7.US Fourth Turning Accelerating Towards Debt Climax - James_Quinn
8.Dow Stock Market Trend Analysis and Forecast - Nadeem_Walayat
9.Britain's FAKE Coronavirus Death Statistics Exposed - Nadeem_Walayat
10.Commodity Markets Crash Catastrophe Charts - Rambus_Chartology
Last 7 days
Has the Fed Let the Inflation Genie Out of the Bottle? - 10th Aug 20
The Strange Food Trend That’s Making Investors Rich - 10th Aug 20
Supply & Demand For Money – The End of Inflation? - 10th Aug 20
Revisiting Our Silver and Gold Predictions – Get Ready For Higher Prices - 10th Aug 20
Storm Clouds Are Gathering for a Major Stock and Commodity Markets Downturn - 10th Aug 20
A 90-Year-Old Stock Market Investment Insight That's Relevant in 2020 - 10th Aug 20
Debt and Dollar Collapse Leading to Potential Stock Market Melt-Up, - 10th Aug 20
Coronavirus: UK Parents Demand ALL Schools OPEN September, 7 Million Children Abandoned by Teachers - 9th Aug 20
Computer GPU Fans Not Spinning Quick FIX - Sticky Fans Solution - 9th Aug 20
Find the Best Speech Converter for You - 9th Aug 20
Silver Bull Market Update - 7th Aug 20
This Inflation-Adjusted Silver Chart Tells An Interesting Story - 7th Aug 20
The Great American Housing Boom Has Begun - 7th Aug 20
NATURAL GAS BEGINS UPSIDE BREAKOUT MOVE - 7th Aug 20
Know About Lotteries With The Best Odds Of Winning - 7th Aug 20
Could Gold Price Reach $7,000 by 2030? - 6th Aug 20
Bananas for All! Keep Dancing… FOMC - 6th Aug 20
How to Do Bets During This Time - 6th Aug 20
How to develop your stock trading strategy - 6th Aug 20
Stock Investors What to do if Trump Bans TikTok - 5th Aug 20
Gold Trifecta of Key Signals for Gold Mining Stocks - 5th Aug 20
ARE YOU LOVING YOUR SERVITUDE? - 5th Aug 20
Stock Market Uptrend Continues? - 4th Aug 20
The Dimensions of Covid-19: The Hong Kong Flu Redux - 4th Aug 20
High Yield Junk Bonds Are Hot Again -- Despite Warning Signs - 4th Aug 20
Gold Stocks Autumn Rally - 4th Aug 20
“Government Sachs” Is Worried About the Federal Reserve Note - 4th Aug 20
Gold Miners Still Pushing That Cart of Rocks Up Hill - 4th Aug 20
UK Government to Cancel Christmas - Crazy Covid Eid 2020! - 4th Aug 20
Covid-19 Exposes NHS Institutional Racism Against Black and Asian Staff and Patients - 4th Aug 20
How Sony Is Fueling the Computer Vision Boom - 3rd Aug 20
Computer Gaming System Rig Top Tips For 6 Years Future Proofing Build Spec - 3rd Aug 20
Cornwwall Bude Caravan Park Holidays 2020 - Look Inside Holiday Resort Caravan - 3rd Aug 20
UK Caravan Park Holidays 2020 Review - Hoseasons Cayton Bay North East England - 3rd Aug 20
Best Travel Bags for 2020 Summer Holidays , Back Sling packs, water proof, money belt and tactical - 3rd Aug 20
Precious Metals Warn Of Increased Volatility Ahead - 2nd Aug 20
The Key USDX Sign for Gold and Silver - 2nd Aug 20
Corona Crisis Will Have Lasting Impact on Gold Market - 2nd Aug 20
Gold & Silver: Two Pictures - 1st Aug 20
The Bullish Case for Stocks Isn't Over Yet - 1st Aug 20
Is Gold Price Action Warning Of Imminent Monetary Collapse - Part 2? - 1st Aug 20
Will America Accept the World's Worst Pandemic Response Government - 1st Aug 20
Stock Market Technical Patterns, Future Expectations and More – Part II - 1st Aug 20
Trump White House Accelerating Toward a US Dollar Crisis - 31st Jul 20
Why US Commercial Real Estate is Set to Get Slammed - 31st Jul 20
Gold Price Blows Through Upside Resistance - The Chase Is On - 31st Jul 20
Is Crude Oil Price Setting Up for a Waterfall Decline? - 31st Jul 20
Stock Market Technical Patterns, Future Expectations and More - 30th Jul 20
Why Big Money Is Already Pouring Into Edge Computing Tech Stocks - 30th Jul 20
Economic and Geopolitical Worries Fuel Gold’s Rally - 30th Jul 20
How to Finance an Investment Property - 30th Jul 20
I Hate Banks - Including Goldman Sachs - 29th Jul 20
NASDAQ Stock Market Double Top & Price Channels Suggest Pending Price Correction - 29th Jul 20
Silver Price Surge Leaves Naysayers in the Dust - 29th Jul 20
UK Supermarket Covid-19 Shop - Few Masks, Lack of Social Distancing (Tesco) - 29th Jul 20
Budgie Clipped Wings, How Long Before it Can Fly Again? - 29th Jul 20
How To Take Advantage Of Tesla's 400% Stock Surge - 29th Jul 20
Gold Makes Record High and Targets $6,000 in New Bull Cycle - 28th Jul 20
Gold Strong Signal For A Secular Bull Market - 28th Jul 20
Anatomy of a Gold and Silver Precious Metals Bull Market - 28th Jul 20
Shopify Is Seizing an $80 Billion Pot of Gold - 28th Jul 20
Stock Market Minor Correction Underway - 28th Jul 20
Why College Is Never Coming Back - 27th Jul 20
Stocks Disconnect from Economy, Gold Responds - 27th Jul 20
Silver Begins Big Upside Rally Attempt - 27th Jul 20
The Gold and Silver Markets Have Changed… What About You? - 27th Jul 20
Google, Apple And Amazon Are Leading A $30 Trillion Assault On Wall Street - 27th Jul 20
This Stock Market Indicator Reaches "Lowest Level in Nearly 20 Years" - 26th Jul 20
New Wave of Economic Stimulus Lifts Gold Price - 26th Jul 20
Stock Market Slow Grind Higher Above the Early June Stock Highs - 26th Jul 20
How High Will Silver Go? - 25th Jul 20
If You Own Gold, Look Out Below - 25th Jul 20
Crude Oil and Energy Sets Up Near Major Resistance – Breakdown Pending - 25th Jul 20
FREE Access to Premium Market Forecasts by Elliott Wave International - 25th Jul 20
The Promise of Silver as August Approaches: Accumulation and Conversation - 25th Jul 20
The Silver Bull Gateway is at Hand - 24th Jul 20
The Prospects of S&P 500 Above the Early June Highs - 24th Jul 20
How Silver Could Surpass Its All-Time High - 24th Jul 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

5 Events This Year That Could Spark The Next Gold Bull Market

Commodities / Gold and Silver 2017 Apr 13, 2017 - 11:29 AM GMT

By: HAA

Commodities

Stephen McBride: Gold had a satisfying first quarter, rising 9% since the beginning of the year. While that can be considered a good start, five events sprinkled throughout 2017 could send it much higher.


Event #1: Gridlock In Washington

With Republicans winning the presidency and both houses of Congress, the gridlock that has plagued Washington since 2010 was sure to be broken. The scaling back of regulation and $1 trillion in fiscal stimulus would return the US to 4% annual growth.

While we’re only 11 weeks into proceedings under the Trump administration, it looks as if Washington’s arteries are still clogged by politics. With healthcare reform failing to even make it to a vote, the pressure is now on the GOP to see if they can push through tax reform and fiscal stimulus.

Given the healthcare debacle, there’s a real worry about their ability to do so. If the pro-growth policies aren’t passed, markets will likely come crashing back down to earth. This would create panic—and that’s good for gold.

Event #2: Populists Take Over Europe

There are several elections in Europe this year that could spell trouble for the future of the EU.

In the Netherlands, although populist candidate Geert Wilders and his Party for Freedom failed to win the election, they did come in second. As such, they may be able to force concessions on the EU from the winning party. Remember, British Prime Minister David Cameron was partly forced to call the Brexit referendum by the UK Independence Party, which only won a single seat in the 2015 election.

Next up is the French election on April 23. The latest polls have Marine Le Pen, leader of the National Front, tied for first place.

Then there’s Germany in September. Although the populist Alternative for Germany has gained in the polls, its chances of recording a victory are slim. Then again, pundits once thought the same about Donald Trump.

The real wildcard in Europe is Italy whose anti-euro Five Star Movement is leading by around 4 points in the polls. While an election doesn’t have to be held until May 2018, the three biggest political parties have called for one to take place this year.

As the continent continues to be shrouded in political uncertainty, gold will do well. If populists actually win, the yellow metal could take off as it did following 2016’s Brexit vote.

It’s no coincidence gold hit its all-time high of $1,896 per ounce amid the 2011 European sovereign debt crisis.

Event #3: China’s Domestic Problems Explode

China’s domestic difficulties have been going on for a while, but it seems the situation has deteriorated further in the last few weeks.

The first quarter of 2017 was the worst-ever start to a year for defaults on corporate bonds in China. Seven companies defaulted on a total of nine bonds year to date, compared to a grand total of 29 for all of 2016.

As a result, bond yields are rising, which will likely lead to more defaults.

With a slowing economy and a total debt-to-GDP ratio of 277%, China’s issues won’t be easily fixed. As the world’s second-largest economy, China has accounted for over 30% of global growth since 2008, and a severe downturn would have global implications.

If the cracks become craters, there will likely be a shift into safe-haven assets like gold. Chinese investors and the central bank are already accumulating gold at a record pace. If the economy does crash, it will only accelerate this trend.

Event #4: Indian Gold Demand Returns

In 2016, Indian gold demand was the lowest since 2003. This was due to the shock of Prime Minister Narendra Modi’s demonetization in November, which brought gold imports to a standstill.

However, with imports for February up 175% year over year, the Indian gold market looks to be back on track.

With pent-up demand for gold plus wedding season in full swing, we should see strong buying over the coming months, which would support higher prices.

In fact, demand could be even higher this year as Indians are still reeling from the government’s move to eliminate 86% of the currency in circulation. Indians don’t trust banks with their money. As such, they are choosing to buy gold instead of keeping their money in an account.

Event #5: Unrest In South Africa

Last week, President Zuma fired most of his cabinet and chose to replace them with close allies. On the news, the South African rand plunged to its lowest levels since December. The country’s credit rating was later downgraded to junk for the first time since 2000.

In February, the ruling party passed a bill that will expropriate more land from white farmers, without compensation. With rising political and social tensions, unrest could break out anytime.

This matters to gold investors because South Africa is the world’s sixth-largest producer and the fourth-largest exporter of the precious metal.

There are already calls for Zuma to step aside, and social tensions are running high, so anything from a civil war to a political revolt could happen. That, in turn, would cause labor disruptions—and any disruption to gold mines would negatively affect supply.

Economics 101 tells us if supply takes a hit and demand stays the same, prices will rise.

Add Gold To Your Portfolio

If the aforementioned events come to fruition, it will likely create uncertainty and panic… and that’s good for gold. Therefore, now could be an excellent time to add some bullion to your portfolio.

As gold is known as crisis insurance, doing so buys you protection from the fallout of these events. Along with serving as insurance, it could be an excellent investment given today’s low prices.

Get A Free E-book On Precious Metals Investing

To create an effective safety net, at least 10% of your investable assets should be in physical gold. However, before you buy, make sure to do your homework first. You’ll find everything you need to know in the definitive e-book, Investing in Precious Metals 101: which type of gold to buy and which type to stay away from, how to spot scammers, where to securely store your gold, why pools aren’t safe places, and more. Click here to get your free copy now.

© 2017 Copyright Hard Assets Alliance - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable,


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules