29
Oct

Current Thoughts 10/29/2017

Where we go next in precious metals, may be determined by market sentiment as we can see greed is good, or at least for those long stocks. But let’s dig a little deeper and get a dose of reality and see if what you hear from CNBC about stocks going up for ever is actually based on any type of economic reasoning.  From there you’ll possibly want to buy this dip in gold and silver for the next leg up. $1,240-$1,250 is still my low end call. $1,370+ the next move up target.
GDP was good on Friday, but without the tech FANG stocks, the markets really didn’t do much. Futures down slightly this afternoon (Sunday). Some data from Dennis Gartman’s Friday newsletter below.
 I’d like to zoom out and add something here I am putting in the update of my Buy Gold and Silver safely book. It has to do with how really overvalued this stock market is based on GDP growth. We used to judge the GDP being good when we would be in the 5% to 10% level from the 50’s through the 80’s. But since the immediate jump after the 2009 crash, we have had a stagnant growth in GDP. Yet the stock market is at all time highs? The Fed can’t even get 2% inflation and is raising rates? Why? If the economy is not ready for a raise in rates, it’s the wrong medicine as we’ll see soon enough. Yes, the old gray mare; she ain’t what she used to be.
 
The first signs of trouble are trickling in, just like they did in 2005 and that is the rise in credit card delinquencies since the 1st quarter of 2009. We’re not up to the 2005 levels yet, but we have had 8 straight quarters of rising default. Same goes for Farmland loans. Only thing not yet delinquent and an area to watch are Commercial and Residential loans.
I see Wall St. veteran wearing his Dow 23,000 hat, and he doesn’t look that happy. I know he knows what’s up.
If I had to choose for the next few months gold or the Dow as to what would give me a better return, it wouldn’t be the Dow.
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About Doug Eberhardt

Doug Eberhardt is a 28 year financial services veteran and precious metals broker selling gold and silver at 1% over wholesale cost. Doug has written a book to help investors understand how gold and silver fit into a diversified portfolio, how to buy gold and silver, and what metals to buy. The book; “Buy Gold and Silver Safely” is available by clicking here Contact phone number for Buy Gold and Silver Safely is 888-604-6534

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