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Gold outperforming Treasuries, here’s why.

Cory
April 13, 2017

There has been a slight change in the correlation between gold and treasuries. Recently gold has been outperforming the treasury market and Chris Temple has some comments on why this is happening and why he thinks it will continue.

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Discussion
26 Comments
    CFS
    Apr 13, 2017 13:34 AM

    Judging by volume there was major buying of PAAS a couple of days ago. A major hedge fund?

    CFS
    Apr 13, 2017 13:38 AM

    (Actually more noticeable in PAAS.TO)

    CFS
    Apr 13, 2017 13:41 AM

    CDE has also been experiencing higher volume, but not excessively so.

    Apr 13, 2017 13:25 AM

    Big money would have been toast were it not for the U.S Public bailing them out.
    Big money will always be chasing yield.When there is no more yield,what is left to chase?
    Big money will always play the game their way until they no longer can.
    That is the time you want to be on the other side of big money.Re “The Big Short”
    Michael Burry, Steve Eisman to mention a couple.

      Apr 13, 2017 13:45 AM

      ditto…..on……”big money would have been toast…….U.S. Public bailing them out'”

    Apr 13, 2017 13:27 AM

    But what happens if/when China comes out and says it has smacked North Korean into line?

    Seems to me that the main driver in gold at the moment is Korea.

    Apr 13, 2017 13:29 AM

    Interesting thoughts on what is going on with gold outside of the gold bugs.

    Apr 13, 2017 13:21 AM

    @HRA-Coffin Re $GDXJ – they are changing the underlying company mix at the end of this quarter and doing a large rebalancing. Part of the change involves allowing larger market cap companies into it. I think that is partially due to the success of the ETF. The AUM is getting too large relative to the type of companies in the ETF so they need to expand the potential universe of companies. A lot of speculation about who gets added and who will get dropped/downgraded. Some of the weird trading we’re seeing in the past couple of days is apparently buying/selling of names traders expect to see added/downgraded. This sort of “chasing your tail” trading is what always makes me leery about ETFs in general and why I am leery to use it as the defining index for gold stocks as many others seem to.

    https://ceo.ca/index?60d78f11d90d

    Apr 13, 2017 13:43 AM

    Can I get opinions on Timmins gold. (T.tmm)
    Increased volume and share price lately as they get closer to announcing PFS on Ana Paula.
    Any shareholders on this Blog.
    TIA.

    CFS
    Apr 13, 2017 13:07 PM

    I bought some back in Sept 2015 when it was heavily over-sold. Still holding at a loss, although fundamentals seem solid.

    Apr 13, 2017 13:32 PM

    When is the 30 year gonna hit 5%?

    Apr 13, 2017 13:42 PM

    Bonds are going to fall versus gold for many years.

    TLT:GLD

    http://stockcharts.com/h-sc/ui?s=TLT%3AGLD&p=W&yr=6&mn=9&dy=0&id=p91899731259&a=518122837

    Apr 13, 2017 13:16 PM

    More on the GDXJ rebalance.

    http://www.cnbc.com/2017/04/12/how-an-etf-gets-too-big-for-its-index.html

    Personally, I don’t like buying the indexes other than as a short term trading vehicle. I think out of 25 gold stocks in an index, 10 will be quality, 5 will be OK, and 10 will be dogs. You are better being selective and try to find a small basket of quality names if you are buying and holding long term. The etfs being trading vehicles are band wagon on versus band wagon off and and only give an illusion of stability and liquidity.

    Apr 14, 2017 14:06 AM

    Here are my inflation model forecasts for March and April USA CPI:
    The weakest model is Oil9. The others are quite consistent, using current oil and gasoline price action combined with EIA forecasts for oil and gasoline:

    Month Oil8 OIl9 Oil10 Gasol11 Gasol12 CPI BLS actual
    Feb’17 2.80 2.75 2.76 2.78 2.81 2.7
    Mar’17 2.62 2.29 2.90 2.46 2.51 TBA
    Apr’17 2.28 2.12 2.40 2.33 2.38 TBA

    March CPI is to be announced any minute now.

    Apr 14, 2017 14:09 AM

    Inflation forecast video (I hate doing PowerPoints):

    https://youtu.be/dd5SeKGaX8M

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