What is on my mind for Silver and Gold
A couple of posts previously, I mentioned my predictions for Silver and Gold for 2017. I believe that Silver should hit in the $25 per ounce range; and gold in the $1500 an ounce range. Now, I am not a fortune teller, so my predictions are simply my personal opinion. It is quite possible that by December, we could be sitting about where we are no. On the other had, the price could be higher or lower than my predictions.
So what am I writing this recent post for? Well, I receive numerous comments and emails from my readers. Readers from all over the world. And I was asked HOW I came up with those numbers of $25 an ounce for Silver, and $1500 an ounce for gold. Some of my readers wanted me to elaborate and go into more detail on my prediction.
Well, this doesn't have to be a long post. My opinions and predictions are based on Econ/Socio/Political movements happening in the world. Especially in the United States. Let me break the 3 things down.
1. Economical: If President Trump gets even a fraction of his campaign promises implemented, there will be a boom to the US economy. Border security and the wall; internal infrastructure; improving and increasing military capabilities. All of these things are going to improve the economy. It will create jobs. And when industry moves, Silver will be in much higher demand. I don't have to restate it, but Silver is used so heavily in industrial uses. This is going to make the price of silver go up. Currently, Silver is at close to 70:1 relationship to Gold. Silver will close that gap. $25 silver and $1500 gold is about 60:1. But with this industrial boom, will come greater debt. This will be temporary. Between tax cuts, and increased employment, revenues will rise. However, it will take a little while. This is going to make Silver and Gold more desirable, because the Dollar will be less desirable.
2. Societal: Some might think this belongs in the Economical section, but hear me out. I believe that the Stock Market is going to require a major correction. Not in the 6,000 DJIA range; but I wouldn't be surprised if it dropped back to around 15,000 - 16,000. It won't be as much a crash, as it will be a correction. This will have a major impact on the US Society. The economy will be moving, but the stock market will be down. That's because the market is over-inflated because most of the money that was loaned to businesses, didn't go to expanding their companies or hiring new people. It went to paying down corporate debt. Basically, the companies paid off debt, BOUGHT BACK a lot of their shares, and in turn, their debt ratio went down. This made the company and their stock shares very attractive. With the industrial growth, these companies will need to raise money to increase their production and their productivity. In other words, they will need to borrow money. Either from the central banks, or they'll issue more stock. That will raise their debt ratio, stock prices will go down. But it will be a correction. Not a crash. This however, will be enough for many investors to look for a better place to move their short term investments. Silver and Gold can benefit from this. Also, if the government needs to temporarily raise funds for the infrastructure growth, the wall, the military, etc. They might try to raise the debt; which is possible. But they could also use this opportunity to issue bonds, bills, and other securities; with a decent interest rate of course. Why is all this in the SOCIETAL SECTION? Because ALL or ANY of this, can lead to INFLATION. No mind you; inflation isn't always a BAD THING. It will raise wages; but also the price of goods. But this is a topic for another day. Suffice it to say, there SHOULD be some inflation coming. This will lower the value of the dollar; (That's a GOOD THING, because it will make our products cheaper and we can export more from the United States); it will raise savings and loan rates. (Good and bad depending if you are saving or borrowing); Investors will look for a more stable investment vs the stock market. Silver and Gold will benefit.
3. Political: This is the most difficult to predict. I'm not talking World Wars or anything similar. If President Trump indeed follows through with make BETTER and FAIRER Trade deals (Fair and Better in the eyes of the United States); then this could open up more competition between companies; nationally as well as internationally. This will be better for ALL countries. Especially independent countries like Great Britain; (Assuming the exit the European Union). I am not being negative against the European Union, simply saying there won't be as much benefit to them. Socialism requires the wealthier to offset and pay for the less fortunate. The European Union doesn't do this simply at the local level; but as a union of countries, wealthier countries are having to pay for and subsidize other countries in the Union. But for other countries, like the USA, Britain, Canada, Mexico, China, Russia, South-East Asia countries, and many others;fairer trade deals will benefit them much more. With current trade deals, some countries are locked out of trading certain items, and over-trade other goods and services. These political moves; if enacted; will increase production of goods that consumers truly want; and not what is being made available. It will lead to advanced technologies in energy, automotive, medical advancements, and many more. Capitalism is truly the best for economies. It allows the consumer to dictate what they WANT TO PURCHASE. And consumers around the world want more solar energy; cleaner planet; better healthcare; better cars and transportation; better telecommunications; etc. If the consumer demands it, the companies will build it. These technology advances are going to be a boom for Silver and Gold. But, it depends on trade deals. These trade deals need to be fair. They need to allow countries that are normally behind technologically; like certain middle east, certain african, and certain asian counties to be able to be part of these trade deals. Every country has some resources, goods, or service to trade or sell. If the trade deals can make it so it's not just the USA, China, Japan, and South Korea leading the way, the world economy will flourish; and so will Silver and Gold.
So, there you go. That is the reason I believe Silver and Gold are going to rise in 2017. While I can't guarantee that 2017 is the magic year; and $25 / silver and $1500 / gold are the magic price; I do feel confident that is the future. I also believe that within the next 5-10 years, the SUPPLY and DEMAND for Silver and Gold for Industrial purposes is going to be so much more dramatic. While I've never promoted Silver and Gold as an investment, those of us who stack or store it for the other reasons; COULD find ourselves in a situation where our future and retirement years are going to be QUITE NICE. And if you're up there in your years already, then you'll be able to leave a very nice inheritance to your children or extended family.
But I don't worry about that. Remember; WHY WE BUY SILVER AND GOLD.
1. Reduce our debt
2. Buy items at a discount price
3. Protect our wealth during inflation
4. Supplement our retirement
5. And for SOME of us, to protect against an economic Armageddon.
I don't necessarily believe #5 is going to happen, but for most of us, #1 and #2 is good for the short term; and #3 and #4 is good for the long term. I believe TODAY is a great time to get silver and gold. And if you're getting it for the 5 reasons I listed, then it doesn't matter what the price is today. In all of those 5 situations, you'll be covered.
CYA: SE
So what am I writing this recent post for? Well, I receive numerous comments and emails from my readers. Readers from all over the world. And I was asked HOW I came up with those numbers of $25 an ounce for Silver, and $1500 an ounce for gold. Some of my readers wanted me to elaborate and go into more detail on my prediction.
Well, this doesn't have to be a long post. My opinions and predictions are based on Econ/Socio/Political movements happening in the world. Especially in the United States. Let me break the 3 things down.
1. Economical: If President Trump gets even a fraction of his campaign promises implemented, there will be a boom to the US economy. Border security and the wall; internal infrastructure; improving and increasing military capabilities. All of these things are going to improve the economy. It will create jobs. And when industry moves, Silver will be in much higher demand. I don't have to restate it, but Silver is used so heavily in industrial uses. This is going to make the price of silver go up. Currently, Silver is at close to 70:1 relationship to Gold. Silver will close that gap. $25 silver and $1500 gold is about 60:1. But with this industrial boom, will come greater debt. This will be temporary. Between tax cuts, and increased employment, revenues will rise. However, it will take a little while. This is going to make Silver and Gold more desirable, because the Dollar will be less desirable.
2. Societal: Some might think this belongs in the Economical section, but hear me out. I believe that the Stock Market is going to require a major correction. Not in the 6,000 DJIA range; but I wouldn't be surprised if it dropped back to around 15,000 - 16,000. It won't be as much a crash, as it will be a correction. This will have a major impact on the US Society. The economy will be moving, but the stock market will be down. That's because the market is over-inflated because most of the money that was loaned to businesses, didn't go to expanding their companies or hiring new people. It went to paying down corporate debt. Basically, the companies paid off debt, BOUGHT BACK a lot of their shares, and in turn, their debt ratio went down. This made the company and their stock shares very attractive. With the industrial growth, these companies will need to raise money to increase their production and their productivity. In other words, they will need to borrow money. Either from the central banks, or they'll issue more stock. That will raise their debt ratio, stock prices will go down. But it will be a correction. Not a crash. This however, will be enough for many investors to look for a better place to move their short term investments. Silver and Gold can benefit from this. Also, if the government needs to temporarily raise funds for the infrastructure growth, the wall, the military, etc. They might try to raise the debt; which is possible. But they could also use this opportunity to issue bonds, bills, and other securities; with a decent interest rate of course. Why is all this in the SOCIETAL SECTION? Because ALL or ANY of this, can lead to INFLATION. No mind you; inflation isn't always a BAD THING. It will raise wages; but also the price of goods. But this is a topic for another day. Suffice it to say, there SHOULD be some inflation coming. This will lower the value of the dollar; (That's a GOOD THING, because it will make our products cheaper and we can export more from the United States); it will raise savings and loan rates. (Good and bad depending if you are saving or borrowing); Investors will look for a more stable investment vs the stock market. Silver and Gold will benefit.
3. Political: This is the most difficult to predict. I'm not talking World Wars or anything similar. If President Trump indeed follows through with make BETTER and FAIRER Trade deals (Fair and Better in the eyes of the United States); then this could open up more competition between companies; nationally as well as internationally. This will be better for ALL countries. Especially independent countries like Great Britain; (Assuming the exit the European Union). I am not being negative against the European Union, simply saying there won't be as much benefit to them. Socialism requires the wealthier to offset and pay for the less fortunate. The European Union doesn't do this simply at the local level; but as a union of countries, wealthier countries are having to pay for and subsidize other countries in the Union. But for other countries, like the USA, Britain, Canada, Mexico, China, Russia, South-East Asia countries, and many others;fairer trade deals will benefit them much more. With current trade deals, some countries are locked out of trading certain items, and over-trade other goods and services. These political moves; if enacted; will increase production of goods that consumers truly want; and not what is being made available. It will lead to advanced technologies in energy, automotive, medical advancements, and many more. Capitalism is truly the best for economies. It allows the consumer to dictate what they WANT TO PURCHASE. And consumers around the world want more solar energy; cleaner planet; better healthcare; better cars and transportation; better telecommunications; etc. If the consumer demands it, the companies will build it. These technology advances are going to be a boom for Silver and Gold. But, it depends on trade deals. These trade deals need to be fair. They need to allow countries that are normally behind technologically; like certain middle east, certain african, and certain asian counties to be able to be part of these trade deals. Every country has some resources, goods, or service to trade or sell. If the trade deals can make it so it's not just the USA, China, Japan, and South Korea leading the way, the world economy will flourish; and so will Silver and Gold.
So, there you go. That is the reason I believe Silver and Gold are going to rise in 2017. While I can't guarantee that 2017 is the magic year; and $25 / silver and $1500 / gold are the magic price; I do feel confident that is the future. I also believe that within the next 5-10 years, the SUPPLY and DEMAND for Silver and Gold for Industrial purposes is going to be so much more dramatic. While I've never promoted Silver and Gold as an investment, those of us who stack or store it for the other reasons; COULD find ourselves in a situation where our future and retirement years are going to be QUITE NICE. And if you're up there in your years already, then you'll be able to leave a very nice inheritance to your children or extended family.
But I don't worry about that. Remember; WHY WE BUY SILVER AND GOLD.
1. Reduce our debt
2. Buy items at a discount price
3. Protect our wealth during inflation
4. Supplement our retirement
5. And for SOME of us, to protect against an economic Armageddon.
I don't necessarily believe #5 is going to happen, but for most of us, #1 and #2 is good for the short term; and #3 and #4 is good for the long term. I believe TODAY is a great time to get silver and gold. And if you're getting it for the 5 reasons I listed, then it doesn't matter what the price is today. In all of those 5 situations, you'll be covered.
CYA: SE
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