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Low Rates, Iran Tensions, Easy Central Banks… All Helping Safe Asset Investing

Cory
June 20, 2019

Craig Hemke, Founder of TF Metals Report shares his thoughts on what is moving the precious metals to 5 year highs. We address the Iranian tensions as a possible driver but also focus on crashing yields and the falling dollar as all helping drive gold. We also look at how the equities are moving with the majors really starting to get going.

Click here to visit Craig’s site.

Discussion
42 Comments
    Jun 20, 2019 20:11 PM

    If nukes start flying in the Middle East gold could hit 10K in a flash. Gold will do better than silver at first.

    cfs
    Jun 20, 2019 20:42 PM

    Why should nukes start flying?

    Just because Iran does not want the U.S. watching them attack oil tankers to drive up the price of oil?

      Jun 20, 2019 20:36 PM

      Three or four tankers sunk strategically in the narrowest part of the Strait of Hormuz would effectively block it, cutting off 30% of the world’s oil supply and putting serious hurt on the economy. Iran in the past has talked to China about stealth torpedoes. The new subway in Tehran was built by the Chinese.

    Jun 20, 2019 20:44 PM

    Iran has no nukes so the ‘flying’ would have to come from our side. Are those idiots in Washington actually that stupid? Could be. I’m hoping we don’t put a carrier into the Persian Gulf……..it would be a sitting duck. JMO

      cfs
      Jun 20, 2019 20:22 PM

      Russia just put a carrier in the Caribbean

        Jun 20, 2019 20:32 PM

        I wonder if that has anything to do with NATO’s naval efforts in the Black Sea?

          cfs
          Jun 20, 2019 20:45 PM

          I have no idea, but it came from the Pacific through China’s Panama canal.

      Jun 20, 2019 20:13 PM

      There have been two carriers in the Persian Gulf at times, since the Gulf war. Counting all the military operations this country has going on to secure access to foreign, oil, without which the economy would collapse, the real cost of gasoline is twice that showing at the pump. Of all the crude oil consumed in the U.S., 45% is refined into gasoline. There is no bigger slice of the pie.

        Jun 21, 2019 21:30 AM

        I thought the current carrier group was south of the Straights of Hormuz. Haven’t seen any news to the contrary.

    Jun 20, 2019 20:46 PM

    Trump’s talk is always bellicose but he doesn’t want war with Iran. He does have himself in somewhat of a corner now and it will be interesting to see how he gets himself out.

    Jun 20, 2019 20:55 PM

    HUI …..up big….188….up 8…..

    Jun 20, 2019 20:27 PM

    SerialBrain2: The reason President Trump tweeted “Prince of Whales” (part 3)

    https://www.youtube.com/watch?v=xkIuf1TY2Sk

    cfs
    Jun 20, 2019 20:53 PM

    Currently:
    Gold Unit Gold Price in Hong Kong Dollar (HKD) Gold Price in U.S. Dollar (USD)
    Gold Ounce 10,860.80 1,390.30

      Jun 20, 2019 20:37 PM

      The high today in Gold was $1396.90, so that was pretty impressive, clearing the 2016 high of $1377.50, and the old 2014 high of $1392.60.

      That makes 2 prior peaks cleared on the same day, and the highest level Gold has traded at since 2013.

      http://schrts.co/nrinGjGW

        Jun 20, 2019 20:38 PM

        Currently Gold is trading at $1397.30, just a few click below the psychological barrier of $1400.

        https://www.bloomberg.com/quote/GC1:COM

          Jun 20, 2019 20:40 PM

          If Gold can move higher or at least maintain most of these gains tomorrow, without a smack down, then it will make for an interesting close to this weekly candle.

          …. And in the seasonally sluggish period in June no less…. Fun times!

    Jun 20, 2019 20:33 PM

    >> This is a bit of a Gold pump piece from Kitco and Phil, but it’s been a fun few days, so there is not telling how things may shake out medium to longer term…

    ____________________________________

    Gold Price Rally Is Just The Start; “Perfect Storm” Is Coming

    Kitco News – Thursday June 20, 2019

    “We should continue to see that break through $1,400 and I anticipate that a lot of the short sellers will end up giving up at that level. So, no telling how high we can go from here, it’s kind of got that perfect storm going on with increasing geopolitical risks and then also a dovish Fed,” Streible said.

    Paul Tudor Jones of Tudor Investment has said that once $1,400 an ounce is breached, the next level is $1,700, and Streible said that is definitely possible.

    “It is entirely possible. The Fed, it’s factored in at 100% that they will cut next meeting. If you look at the last time we had this aggressive hike cycle followed by rate cuts, they had higher levels to go down from, so with the Fed only being at 2 and a quarter right now, if they cut a half, that doesn’t give them much firepower in order to stabilize the economy,” he said.

    Another round of quantitative easing could happen, Streible added, and that could push gold much higher.

    https://www.kitco.com/news/2019-06-20/Gold-Price-Rally-Is-Just-The-Start-Perfect-Storm-Is-Coming.html

      Jun 21, 2019 21:27 AM

      Go Tudor………$1700 would be really nice……….

    Jun 20, 2019 20:54 PM

    The gold pump article makes sense. If gold does go over 1400$, things (we would think) have changed. I’m actually getting bullish [which means, short]
    But all the yahoos saying the fed is going to do QE is kinda funny. They are truly clueless.

      Jun 20, 2019 20:10 PM

      How about the clueless yahoo that kept calling for another big washout in gold? How does he think more QE will be avoided?

        Jun 21, 2019 21:53 AM

        QE is impossible for the fed to do. It takes a corrupt president with a corrupt treasury to let it happen.
        Question: when do big washouts come?
        Answer: when you don’t expect them.

          Jun 21, 2019 21:25 AM

          I have a big question mark on the Treasury……I read…..That the Treasury Sect. gets his check from the IMF…….What say ye……thanks…
          Secondly,………Sect. Mnuchy….is questionable in character ….jmo

            Jun 21, 2019 21:51 AM

            There’s been a massive cleanup at the treasury. Hundreds fired and many arrests and indictments. Part of draining the swamp (that no one seems to recognize).

            Mnuchin is doing his job. He’s a smart guy, and knows the corrupt system quite well.

            Jun 21, 2019 21:33 PM

            Thanks for the follow up………
            I must be missing some news, on the treasury firings……..

          Jun 21, 2019 21:07 AM

          Trump has been calling for a rate cut so he has no problem with the corruption that IS the Fed in its entirety. However, that’s beside the point. The Fed will do what it has to regardless of who’s president. You need to stop with the fairy tales.

          As for your calls for gold to drop several hundred dollars not long ago, they just provided more proof that you don’t have a clue about the necessary conditions, technically/fundamentally, for such to occur. There was virtually no risk at all of a big drop at the time you recently warned of one.

            Jun 21, 2019 21:02 AM

            The fed can’t do squat! The fed needs bonds from the treasury to do anything. Trump controls the treasury. Only puppet presidents allow the fed to do what they’ve been doing for all of these years. Trump is not their puppet.
            Anyone who thinks QE is needed is absolutely clueless to what QE actually is.
            Infrastruture funding is what will happen. And it won’t be the fed.

            The GLD chart back in February did look like the wash was on. I still think the washout will happen before the bull resumes. Even if gold did drop 350$, it wouldn’t be a big deal. Just a needed cleansing.

            Jun 21, 2019 21:25 AM

            Sorry Chartster but you’ve got it all backwards with respect to the Fed’s power and the farcical relationship between the Treasury and the Fed. You’ll see in due time.

            As for the gold chart in February, nothing about it suggested that we should expect anything other than a normal correction.

    Jun 21, 2019 21:25 AM

    Well…….gold went up to $1411.83……..Nice

      Jun 21, 2019 21:16 AM

      Gold is still hanging right over $1400 in pre-market trading.

      It would be nice to see a strong close to end this week and put in a solid weekly candle. Even if Gold traded sideways in the $1390-$1410 range, that would be a huge win for the sector.

    Jun 21, 2019 21:14 AM

    China National Gold said to study bid for Canada’s Iamgold

    Dinesh Nair and Scott Deveau, Bloomberg News

    (06/20/2019)

    https://www.bnnbloomberg.ca/china-national-gold-said-to-study-bid-for-canada-s-iamgold-1.1276120#_gus&_gucid=&_gup=Facebook&_gsc=AQKfiRN

      Jun 21, 2019 21:26 AM

      I’m looking forward a to busy M&A season for the balance of 2019 and into 2020.

      The big boys in Gold and Silver did their Mega-Mergers, and a few Aussie Stocks have come over to poach some North American assets, but the real TakeOver fever has not hit yet. With prices moving up, maybe some will escalate their plans and make some offers.

        Jun 21, 2019 21:28 AM

        In addition, for some of the beaten down Jr Explorers or Developers, I could see a few 2-3-4 way Mergers of equals where one company has cash but no properties, one is broke with a good property, and some are just near-ology consolidation moves of an area play. By conglomerating together they’ll survive and attract more investors as a larger entity.