History shows it’s always been a good time to buy gold.
Of course some times to buy are better than others.
In an excellent essay published with perfect timing in January 2020, “The Allegory Of The Hawk And Serpent: How To Grow And Protect Wealth For 100 Years”, Chris Cole of Artemis Capital presents his views on market cycles and ideal allocations.
Here’s an interview on the subject he did with Danielle DiMartino-Booth:
My take is that we’ve entered what Cole calls “the right-wing of the Hawk”, which “represents inflation, fiat default, and helicopter money, […] a pattern as old as money itself.”
This fits perfectly with concepts like The Fourth Turning, which I touched on yesterday in Guns & Dividends.
Before reading further, please revisit my post Gold Is All That Glitters. It’ll take just a few seconds to check the eye-popping charts, or two minutes to read.
It was posted April 1st. A key excerpt:
Gold’s score has turned bullish now to a degree observed on average once every 20 years.
While no signal is fool-proof and the world seems increasingly volatile and prone to nasty surprises, a signal of such rarity as exists now should never be ignored. It was last in evidence in 2009 before gold doubled over the next two years as silver increased five-fold. Shares in quality explorers gained multiples more than the metals.
Technical setups are extremely favorable however there’s no rush; it’s reasonable to expect a consolidation in the sector, perhaps a pullback, lasting into summer.
Here’s a 1-year gold chart, showing that indeed it did consolidate and pull back through summer:
While we’re on the subject of cycles, patterns, and revisiting old posts, here’s a reminder of where we are in the Dow / gold ratio, originally posted August 13 in + 3rd URA. Tech Turned Over, Uranium Set To Explode:
Now consider this chart I offered in early January:
At the time stating:
The obvious choice within this theme is bullion, or an ETF tied directly to the price of gold. Yes, but what fun would that be?
I like a few royalty plays, but the one I’ve owned longest and am most comfortable with is Gold Royalty Corp. (GROY) .
Official site - https://goldroyalty.com
Here’s a screen cap from its updated presentation dated September 2023:
Despite being at or near all-time highs vs. every currency, gold is currently shunned. It’s very underrepresented in portfolios from punters to pensions to hedge funds, yet it totally defied the significant run-up in the dollar this year which shows remarkable relative strength.
GROY has considerably underperformed gold this year, showing relative weakness. However, the inherent leverage in explorers and miners which has worked against GROY so far will work very much in its favor when the market’s near-total disinterest in precious metals turns again to mania.
Take a look at UROY (Uranium Royalty Corp.) as an example. Uranium went sideways through early 2023 while UROY ticked steadily lower, until uranium spiked higher and the market took an interest; then UROY broke its down trend and rallied nearly 90% higher in just a few months.
This is a chart for UROY in 2023. Keep the declining wedge pattern shown in red in mind when looking at the GROY chart further down the page:
Commodities vs. equities:
Another foreign war to fund? Another bailout? Another vote-buying giveaway?
Another subsidy grift? Another bank failure? Another looting spree?
Another trillion in debt and interest payments?
Who pays for all that? You and I do, with every tax, every purchase, every meal, and with the devaluation of every dollar, euro, shekel or rial left over.
“Satan, laughing, spreads his wings.”
- Black Sabbath, War Pigs
You want protection against perpetual currency devaluation which the perpetrators brainwash people into calling “inflation”?
You want a proven, safe and effective defense against unchecked socioeconomic and geopolitical folly destroying your and your children’s purchasing power and wealth?
You want a smoother sail through the turbulent times ahead?
You want gold?
I do. I want gold and more gold, so in the fullness of time I’ll be laughing too.
In July I added GROY, taking my average cost down to $2.57, not counting the 3% dividend it pays per annum based on its current share price.
I’m now going to add a 3rd position in GROY, and will look to add warrants when it’s above $1.50
It closed the week at $1.35, exhibiting a textbook and very bullish declining wedge.
GROY 3-year chart:
One way or another, a diversity of people are learning the same hard lessons about fiat currency and coming to the same conclusion…
Gold vs. Israeli shekel:
Gold vs. Iranian rial:
Gold vs. Qatari rial:
Gold vs. Egyptian pound:
Gold vs. euro:
Gold vs. “mighty” U.S. dollar:
Gold vs. Australian dollar
Gold vs Canadian dollar
Gold vs. Japanese yen
Even Big Brother’s most sycophantic fans are probably starting to get the picture by now, perhaps sensing some sort of long-term pattern in play no matter which debasement-based currency one looks at across the globe.
The enemy of the fruits of your labor and wealth is not your friend, and the enemy of unlimited borrowing, spending, fraud and war is gold.
Pick a side.