The Gold Silver Ratio When investors are deciding to buy gold or buy silver, one of the key gauges is the Gold Silver ratio. However this ratio is open to interpretation, where should gold be in relation to silver exactly? In other words how many troy ounces of silver are equal one troy ounce of […]
ECB launches QE March 2015
Mario Draghi launched the European answer to the Federal Reserves money printing of the last few years when he announced in January that the ECB would be pumping 60 billion
Faltering US housing market April 2014
Six years after the collapse of 2008 there is a real sense of optimism among analysts that the US economy is finally shrugging off the effects of that collapse with real estate and stock market gains being the Fed’s chosen workhorses to drive the US economy forward.
In US dollar terms gold fell 28% in 2013 and in Euro terms gold topped out in September 2012 at just over €1380 before falling back to the €900 area by December 2013.
1.- It costs 7.8c to create a C note(100 USD bill), 2 grams of gold(spot price roughly $80) costs roughly $75 to mine.
2.- US national debt is increasing by between 1/2 and 1 trillion USD annually.
3.- Annual gold production for the past few years has averaged 2500 tonnes.
Last week the Federal Reserve announced to a surprised financial community that there would be no reduction in money printing this month. The markets had priced in a 5 to 10 billion reduction in the Fed’s 85 billion USD a month of QE which has been channelled into mortgage backed securities and US treasuries to support the US housing and government debt markets and thus keep interest rates at abnormally low levels.
Exciting price moves for silver and gold
Both silver and gold pushed up strongly in the last few days with Thursday the 15th August being notable as silver moved up 70 cents from 16.50 euro to the 17.20 area. This is hugely interesting because the silver price has been anchored down around the 15.00 euro area for most of the summer and just 2 weeks ago it was down to 14.80 as the Fed issued new commentary regarding tapering.
For those who are disillusioned by the recent downturn in the price of gold and silver, it is worth re-visiting the fundamentals of what exactly has been driving the current bull market.
Ask yourself the 13 questions below and then ask yourself is the perceived bull market decline based on a change in the facts or on simple sentiment:
Are the PIIGs reduced their debt burdens?
Silver price prospects in 2013.. Silver rose 6.4% against the euro in 2012 rising from 21.38 on the 1st January 2012 to 22.75 by the 31st December 2012. In the decade up to the end of 2011 the average price performance for silver against the euro was 19.3% increase per annum so 2012 ranks as a […]
Gold Sovereigns are money Sovereigns The Gold Sovereign Coin truly is money. Whenever I try to explain to people that the Euro, the Dollar, the Yen and all paper currencies are not money, I usually get a bewildered look. In the simplest of terms Money must serve two basic principles, firstly it must be a […]
