Bill Murphy of GATA.org
says it's business as usual in the markets; the gold / silver price rigging continues to plague the sector. Dovish comments from the new Federal Reserve Chairman, Jerome Powell, suggests a relative value in commodities relative to shares and paper assets.The World Gold Council notes gold reached peak supply in 2017, suggesting that lower output could increase demand pushing price to $1,500 in 2018. Bill Murphy thinks this forecast is tame, his analysis suggests that once the selling passes, the price ascent will be so abrupt that late comers will be unable to procure good bargains. Adding to the bullish case, Gold Money Director, Alistair MacLeod recently made a compelling case for the US dollar to continue in its downward trajectory
. Bill Murphy emphasizes the point that many guests continue to make on the show - gold / silver may be the best value available in the markets at current prices. Venezuela's President Maduro, just removed 3 zeros from the currency supply, reducing a 1,000 Bolivar note to merely 1 Bolivar via a keystroke
.The hyperinflationary economic disaster represents a de facto warning siren to all global inhabitants, that systemic currency disaster can unfold in less than one year's time.A single gold coin held in the nation made the holder wealthy, increasing the relative purchasing power to 70 million Bolivars
Peter Grandich of Peter Grandich and Company
and Pete Speaks
returns with commentary on the US stock market and the PMs sector. Topping the financial headlines; the trade war between Washington DC and China, as well as the new Shanghai gold backed yuan-petro futures exchange. While our key trading partners, China / Russia continue to stockpile sound money, i.e., gold / silver, the West is doubling down on debt. Students of Austrian Economics learn that debt = bondage; a concept well understood by the national founders.Benjamin Franklin noted, "Rather go to bed without dinner than to rise in debt... If you know how to spend less than you get, you have the philosopher's stone..." Thomas Jefferson famously said, "To preserve our independence, we must not let our rulers load us with perpetual debt." More recently, Yogi Berra said, "You can observe alot, just by watching," in similar fashion, the national debt just topped $21 trillion, $21,000,000,000,000.Current estimates of US Federal Deficit spending approaching $1 trillion, annually. So it's not surprise to learn that one leading money manager, Seth Klarman
, just advised clients to drastically increase cash levels
in their investment portfolios
. Warren Buffett says that when he retires, there are three people he would like to manage his money. First is Seth Klarman of the Baupost Group. Peter Grandich and the host share Seth Klarman's cautious outlook on US equities and related securities, at least until valuation metrics return to equilibrium levels.The overextended S&P 500 price-to-earnings figure of 24
, has a historical mean of of 15.70. In comparison, the PMs sector remains a deeply discounted levels relative to paper assets as the commodities / S&P ratio suggests a new commodities bull market is imminent.Top financial market technician, Clive Maund presents a compelling case for the resumption of the long-term silver bull market
(figure 1.2.). The host notes that India may outlaw Bitcoin / crypto wallets
, setting the stage for improved demand in gold / silver, as millions abandon digital money for traditional safe haven alternatives.
The latest Listener's Q&A segment includes phone calls on the increasingly popular topics of silver and Bitcoin from Tom in Arizona, John in Sunny San Diego and an anonymous caller. Tom starts off the segment, noting that he's heard that many of the silver dealers are running low on their stockpiles and he wonders why the price remains subdued amid low supply.John is also perplexed by the silver market scenario. Chris suggests that the improving fundamentals have boosted the technical case for a renewed silver bull market. For instance it appears that the downtrend was competed in 2015 and a solid base formed in 2016/2017 which could launch pad for a new advance to multi-year highs of $28-$30.By observing the long-term trend, investors will gain insights into the strength / endurance of the silver price advance. The second caller finds a correlation between the announcement of a BTC futures contract on the CBOE and the 100% advance in BTC in Dec. 2017, followed by a subsequent 50% decline. Several key experts in the field refute the futures market thesis, citing instead seasonal factors combined with lack of liquidity. In Dec. 2017, leading BTC exchanges turned down hundreds of thousands of applications for new accounts. At one point Bitfinex accounts were actually put up for sale, for several thousands of dollars, online. Large delays in buying Bitcoin, even on Coinbase, where investors were expected to overcome time-based hurdles as a security feature, to build trust over time added to a supply bottleneck. The situation accelerated demand to euphoric levels. If the futures contract scenario were truly to blame then the readily available BTC ETF, ticker GBTC would be the go-to alternative and was actively traded on the NYSE since 2016. Chris posits that the bottleneck scenario could return at the end of 2018/2019 as institutional investor demand increases. As demand grows exponentially, futures and options markets may resize contracts to reflect dwindling supply, so that the typical contract size of 1 BTC could drop sharply.
Bill Murphy, GATA ChairmanMurphy grew up in Glen Ridge, N.J., and graduated from the School of Hotel Administration at Cornell University in 1968. In his senior year he broke all the Ivy League single-year pass-receving records. He then became a starting wide receiver for the Boston Patriots of the American Football League. He went on to work for various Wall Street brokerage firms and specialized in comodity futures. He began as a Merrill Lynch trainee and went on to Shearson Hayden Stone and Drexel Burnham. From there he became affiliated with introducing brokers and eventually started his own brokerage on 5th Avenue in New York. He now operates an Internet site for financial commentary, www.lemetropolecafe.com.
The Grandich Letter
About Peter Grandich Managing Member, Grandich Publications, LLC.
With no formal education or training, Peter Grandich entered Wall Street and within three years was appointed Vice President of Investment Strategy for a leading New York Stock Exchange member firm. He was the editor and publisher of four investment newsletters, and appeared on national TV and radio over 400 times.
Labeled the Wall Street Whiz Kid, Grandich gained national notoriety by being among the very few who not only forecasted the 1987 stock market crash just weeks before it happened, but on the very next day he predicted that within a year the market would reach a new all-time high which it did. Proving his 1987 forecast was no fluke, Mr. Grandich said in January 2000 that the year 2000 will go down as the year the great mega bull market of the 80s and 90s came to an end.
He speaks at numerous major investment conferences worldwide and was awarded Best Speaker Award eight times by the International Investors Conferences.
Grandich is the founder and managing member of Grandich Publications, LLC. Grandich Publications publishes The Grandich Letter. First published in 1984, it provides commentary on the mining and metals markets. In addition, the company also provides a variety of services to publicly-held corporations on a compensation basis.
In addition, Grandich is a member of the National Association of Christian Financial Consultants, and a long-standing member of The New York Society of Security Analysts and The Society of Quantitative Analysts.