Minimize

Welcome!

Morning Thoughts from Chris Temple

Big Al
December 8, 2014

Click download link to listen on this device: Download Show

Chris is offering a our listeners three a free three issue trial subscription to The National Investor. If you would like to receive this free trial send Cory an e-mail at fleck@kereport.com.

Discussion
3 Comments
    Dec 08, 2014 08:21 AM

    Behind the Swiss gold vote, the SNB was aggressively pricing in negative interest rates. I believe that the U.S. is set to join the competitive currency devaluation by also aggressively pricing in negative LIBOR.

    http://www.bloomberg.com/news/2014-11-24/snb-pressure-builds-as-libor-approaches-zero-chart-of-the-day.html

    PF
    Dec 08, 2014 08:39 AM

    Chris, please explain why you think precious metals will do well in 2015 despite your deflationary expectations?

    Dec 08, 2014 08:03 PM

    There are a number of reasons, as I explain in more detail in my 2015 forecast issue. Generally, though, it’s already apparent that gold has been getting a bit more of a bid even as the US Dollar Index added to its gains recently. This, among other things, as some see that the central banks can’t revive economies–and will have a tougher time going forward even keeping the markets afloat.
    As faith is shaken more in traders, gold will do better as other safe havens (Treasuries, and maybe the dollar for a bit longer) do as well similarly, for example, to 2010 when it looked like the euro might fall apart.
    This time around, too, if the beatings elsewhere get worse, gold shouldn’t suffer as it did in 2008. Back then, there were a lot of long gold positions that had been enabled by a soft dollar and carry trade. When things imploded, and the dollar spiked, those had to be unwound along with everything else. Nowadays, there are no such leveraged long positions in gold. Quite the contrary. So that aspect would not stand in the way of gold catching a safe haven bid if deflation and equities get worse.