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Gold Prices May Hit $10,000 Thanks To Crashing U.S. Dollar And Rising Inflation - TheStreet

Gold Prices May Hit $10,000 Thanks To Crashing U.S. Dollar And Rising Inflation - TheStreet

Release Date:  Friday, February 2, 2018

“The Dow Jones Industrial Average on Friday was on track to shed about 880 points for the week, which would be its steepest weekly slide since January 2016, when it shed 1,079 points, according to FactSet data.” (“Dow industrials poised for nearly 900-point weekly drop--biggest weekly setback in 2 years.” Market Watch 02.02.18)

‘“After holding it’s own through the week and reacting to a very consistent FOMC statement earlier in the week, [Friday’s] jobs report, signs of wage inflation and resurgence of the U.S. dollar has taken gold lower…with a negative bias heading into the weekend,’ said Jeff Wright, chief investment officer at Wolfpack Capital.’ (“Gold aims for biggest 1-day loss of the year after strong U.S. jobs data.” Market Watch 02.02.18)

Gold Prices May Hit $10,000 Thanks To Crashing U.S. Dollar And Rising Inflation - TheStreet
Since mid-December, gold prices have soared, but Jim Rickards believes the big price gains in gold are just getting started.

“Gold prices have soared 9% since mid-December on the back of a plunging U.S. dollar and rising concerns over inflation at the hands of tax reform. 

“But, the big price gains may just be getting started.

"’This is gold's breakout year,’ said well-known author and gold expert Jim Rickards in an interview. ‘We are in the third bull market [in gold] of my lifetime -- and we have a very long way to run.’ Rickards believes a U.S. war with North Korea, a trade war with china and the possible impeachment of U.S. President Donald Trump if the Democrats regain control of the legislature could send gold prices skyrocketing. Prolonged weakness in the U.S. dollar will be an enabler, too.

“Over the next 40 years or so, Richards thinks gold prices will touch $10,000.

“Rickards adds that gold at $10,000 may imply an increase of prices of other goods and commodities, thus eroding consumer purchasing power.

"’All gold does is it preserves your purchasing power. But, if gold is $5,000, then oil is probably $400, and everything is double or triple, you're not really ahead of the game,’ Rickards said. (“Gold Prices May Hit $10,000 Thanks to Crashing U.S. Dollar and Rising Inflation.” TheStreet 01.29.18)

If The Market’s Drop Turns Into A Correction, History Says Hide Out In Gold, Bonds - CNBC
CNBC takes a look at all the times the Cboe Volatility index jumped 5 points in five days over the last 10 years to see which ETF outperformed during this period.

“When the market falls and volatility rises, investors should hide in bonds and gold, according to CNBC analysis using hedge fund analytics tool Kensho.

“CNBC found the exchange-traded funds that outperformed during periods when the Cboe Volatility index (VIX) – the market's fear gauge – jumped five points in five days. This kind of volatility surge (like the one beginning this week) has occurred 59 times the last 10 years.

“The iShares 20+ Year Treasury Bod ETF (TLT) has averaged a 2.1 percent gain during such a move in the VIX, according to analysis using Kensho .

“Investors may seek the safety of treasury bonds during times of stock market turmoil.

“The findings also show gold outperformed in times of rising volatility. Both the iShare Gold Trust and the SPDR Gold Trust rose 0.9 percent on average during a five-point gain in the VIX in five days.

“Investors may start looking for safe havens if the stock market's drop Tuesday continues into the rest of the week. The Dow Jones industrial average fell as much as 400 points in its single-worst day )as measured in points) since June 2016; on a percent basis, the Dow was having its worst day since May. The S&P 500 fell 1 percent Tuesday.

“The VIX peaked at 15.42 Tuesday, reaching its highest level since August. A move of 5 points would take it over the key 20 threshold watched by many traders.” (“A decision to invest today has to rely on the belief that ‘it’s different this time,’ says billionaire Howard Marks.” CNBC 01.24.18)

Our Gold Price Prediction Shows 300% Gains Thanks To These 3 Catalysts – Money Morning
According to Money Moring Resource Specialist, Peter Krauth, the resent rise in precious metals is the only the beginning and has massive profit potential for individual investors.

“Gold prices have risen 5% in the last six weeks, breaking $1,350 an ounce for the first time since June 2016.

“Peter's enthusiasm has given us our gold price prediction for 2018. According to Peter, gains of nearly 300% are on the table.

"’I think we'll see $1,400 this year and, eventually, $5,000 before this bull run is over,’ he says.
“Peter sees inflation as a key driver of rising gold prices this year.

“For the last six years, inflation has slowly increased, rising from 1.8% to 2.2% between 2015 and 2016. In November 2017, the core CPI inflation rate was 1.7%. The U.S. Federal Reserve is confident this figure will continue to grow, which is why it hiked interest rates last month.

“Historically, as inflation drives down the purchasing power of the U.S dollar, the rate of gold purchases increases.

“Taking advantage of a weaker dollar, international buyers purchase more of the precious metal, driving up the price of gold. This is why gold prices have risen in the last six weeks; as the dollar weakens, global buyers have jumped in and are buying gold ‘on sale.’

“In an effort to keep inflation's rise in check, the Fed is likely to limit the amount of money in circulation by raising interest rates. (“Our Gold Price Prediction Shows 300% Gains Thanks to These 3 Catalysts.” Money Morning 01.29.18)