Sunday , 19 November 2017


Don’t Look a Gift Horse in the Mouth! Now’s the Time to Buy Gold, Not Sell It

Since the fundamentals still point to gold’s long-term viability… why [are] investors responding by selling gold? I was always told not to look a gift horse in the mouth… [so] take advantage of the dip.

So says Peter Schiff (www.europac.com)  in edited excerpts from an article* originally posted at www.TheDailyBell.com entitled Peter Schiff On the Recent Gold Pullback.

This post is presented compliments of Lorimer Wilson, editor of www.FinancialArticleSummariesToday.com (A site for sore eyes and inquisitive minds), www.munKNEE.com (Your Key to Making Money!) and the Intelligence Report newsletter (It’s free – sign up here). You can also “Follow the munKNEE” daily posts on Twitter or Facebook. The article may have been edited ([ ]), abridged (…) and/or reformatted (some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. Please note that these paragraphs must be included in any article re-posting to avoid copyright infringement.

So wrote Schiff in an earlier article that is more appropriate today than ever and which continues in an edited excerpts format below:

UNCHANGING FUNDAMENTALS

It’s important to understand the fundamental reasons for owning gold, and those reasons have not changed. The U.S. government embarked on a decades-long spending spree of historic proportions. To finance the resulting debt, the Federal Reserve is printing money furiously. Because most every central bank governor appears indoctrinated in the Keynesian economic philosophy, foreign central banks are simultaneously printing euros, yen, francs, yuan, and pounds to “keep up.” Of course, this competitive devaluation actually represents countries shooting themselves in the foot.

Don’t expect any abrupt changes [in the abovementioned approach], either. The Fed’s philosophy – a resolute faith in central planning and debasement – has been unchanged since Paul Volcker stepped down as Chairman in 1987. Rather than considering any change of direction, the Federal Reserve Board…under Ben Bernanke has literally instituted a revolutionary devaluation program for the dollar – and gold is the only way to avoid his guillotine.

TRUE VALUE VS. SPOT PRICE

Let’s remember that it is the fundamental value of an asset which dictates its long-term market price. Yet for some reason, many see this relationship backwards – they use the short-term market price to extrapolate the fundamental value. Consider a car on the dealer’s lot: if the price of the car falls tomorrow, it becomes a better deal. If the price rises tomorrow, the car has becomes less attractive. This principle is equally true in long-term investments. I believe that gold’s fundamental value is far higher than $1,600, and far higher than $2,000. So, while it may be unsettling for some of those who own gold to see steep short-term price declines, remember to focus on the fundamental value of the asset, not the spot price on the market today. Has the fundamental value of gold fallen in these past two weeks? Quite the opposite…so why are investors responding by selling gold…I was always told not to look a gift horse in the mouth.

KEEP CALM AND CARRY ON

Do not get caught in the exuberance or pessimism of short-term movements, even if they’re sharp. Observe the fundamentals – the events in Europe, the looming budget calamity in the U.S., central bankers’ steadfast strategy of debasement, and emerging markets’ continued diversification into precious metals. These are the main drivers for gold’s long-term appreciation.

To my readers who may have purchased metals just before this pullback, your concern is understandable but I believe this bull market has a long way to run, and the rise up ahead looks even steeper from these levels.

Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.

*http://www.thedailybell.com/3016/Peter-Schiff-On-the-Recent-Gold-Pullback

Related Articles:

1. The Best Article On “What Happened to the Price of Gold & Why?”

What happened?! is the question so many are asking about Friday’s waterfall in prices. A better question is, “Why?” Outside of the insiders, no one really knows. Yes, there can be some fairly cogent explanations, lots of glib answers, but no one knows, for sure. What we do know for sure is that the market is always the final arbiter [and this is what the market is saying:]

2. You’re Being Played! Don’t Sell Your Gold! It’s Going MUCH Higher – Soon!

The paper gold market is being used to shake the bullish tree harder this time than any time before because of what is to come.  Fear is the most powerful emotion in markets and it is being used perfectly to enrich the grand names of finance at your expense. We are right in front of that time when the market performs a classic bottom both in shares and physical. From this point gold is going to and through $3500 [so] if you are unable to buy at this time there is one thing you can do – to get into the fight and out of the stands. That act is do nothing, and do not capitulate. Let them play the price game, but give them nothing whatsoever of yours. Words: 758

3. The Decline in Gold & Silver Is Being Orchestrated By the Fed – Here’s Why

By its obvious and concerted attack on gold and silver, the U.S. government could not give any clearer warning that trouble is approaching. The values of the dollar and of  financial assets denominated in dollars are in doubt. For Americans, financial and economic Armageddon might be close at hand….

4. Why Gold & Silver Have Pulled Back – Some Enlightening & Reassuring Insights

David Mcalvany (www.mcalvany.com) covers the reasons behind the major pullback in metals on April 12, and where they may go from here, in this most enlightening and re-assuring 8:14 minute video.

5. Irrationality Reigns In the Gold Market: What Is Going On?

I have no problem with corrections in general, as they are a healthy part of any bull market and provide a platform from the which the next upleg can spring but something is not quite right about the recent price action in precious metals as the markets have become increasingly divorced from reality over the past few months.  Let’s look at some of the glaring contradictions and then discuss the implications.

6.  Central Bank Gold Purchases up 17% – Here’s Why You Should Jump in or Top Up Too

If central banks are preparing for a major change in the value of the dollar, shouldn’t we? The US dollar cannot and will not survive the ongoing abuse heaped upon it by government planners and federal officials. That not only means the gold price will rise, but that many, if not most currencies, will lose a significant amount of purchasing power. This has direct implications for all of us.

7. Gold: Why It Makes the Ideal Alternative Pricing Mechanism – An Infographic

Measuring market data using fiat currencies can be misleading. Even though an asset may rise in dollars, it may be because of declining currency value rather than true economic process.  With central banks devaluing currency at record rates, gold’s steady purchasing power makes it an ideal alternative pricing mechanism.

8. Drop in Gold & Silver An Attempt to Crush PM Advocates

Everyone personally holding physical gold and silver, as we have been recommending, has no margin call to meet and no reason to sell. This is a temporary situation, and it will pass. Now is not the time to panic, as that is the intent of the central planners/bankers in forcing gold and silver through strong support levels. Stay the course. To the extent you can, continue buying the physical metal.

9. Gold Bugs: Look Out Below! Gold Could Drop to $1,000

Gold bugs: look out below! There are undoubtedly a lot of speculative purchases that may need to be unwound in coming years. I think gold could fall to $1000 or even less as it realigns with other commodity prices. Words: 865; Charts: 4

10. Gold & Silver: Go “Get” While the Getting is Good! Here’s Why

There will come a time, and based on current charts no one knows when, that prices for gold and silver will become prohibitive and/or governments will do what they can to inhibit (steal) ownership, maybe even making it criminal to own or use in transactions. [That being the case we advocate that you go “get”] physical gold and silver [while the getting is good], consistently and at any price.  The point here is not to “make money,” but to preserve and/or create wealth. [Let me explain.]

11. Bargains in Junior Gold Stocks Are Just Waiting to Be Plucked!

Out of this doom and gloom, there are opportunities – major opportunities!  Fear has taken over the stocks of the TSX Venture and the last time that happened, it was the greatest buying opportunity of our lifetime. So it is now. If you want to buy low, and later sell high, the bargains are now waiting to be plucked. How jealous everyone would be if you had the foresight to buy when prices were so cheap. So, what are you waiting for?

One comment

  1. Here is the question you need to answer!

    Is your portfolio is half full of PM’s or is your portfolio half empty of PM’s?

    Either way you are well positioned for the FUTURE, because as the “value” of paper money fluctuates so does the value of your PM’s.

    How many investors actually spend ALL their money, think of your PM’s as the last of your money that you will spend, unless you get a really good deal that requires using it and you will sleep better a night…

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