Can Physical Gold Demand Sustain Its Prices in 2017 and Beyond?
China’s gold demand increased ~10% year-over-year in 1H17.
The price-to-earnings (or PE) multiple of the S&P 500 has risen 80% since 2011.
The more-dovish-than-expected minutes from the Federal Reserve’s July meeting were released on August 16, 2017. These minutes impacted the dollar negatively.
The minutes from the Federal Reserve’s July meeting were published on August 16. The Fed signaled a potential slow rate of hikes going forward, given the lagging rate of inflation.
Gold acts as an inflation hedge for investors. When inflation rises, the value of the paper currency falls, as the same currency can now buy fewer goods and services.
The US jobs report showed that US employers added 209,000 jobs in July. This marks the second straight month of strong job gains.
Morgan Stanley (MS) equity strategist Tom Price believes that while gold has demonstrated its ability to persevere and preserve its value under all circumstances, Bitcoin’s platform “literally requires the lights to stay on.”
Ray Dalio, the chairman of Bridgewater Associates, recommends that investors hedge their risks, with gold forming at least 5%–10% of their portfolios.
Distributed Ledger Technology is Game Changing The most significant development that has come out of the digital currency craze is validation of distributed ledger technology. This technology has the potential…
Gold versus Bitcoin However, there are a range of significant differences: Gold has been established as a store of wealth throughout human history. Gold’s market capitalization is roughly $8 trillion,…
Gold is Physical, Bitcoin is Digital Recently, we have received many questions about digital currencies and in particular, bitcoin (defined as the world’s first decentralized digital currency). The queries range…
Gold stocks moved slightly higher with the gold price. For July, the NYSE Arca Gold Miners Index (or GDMNTR) gained 3.6% while the MVIS Global Junior Gold Miners Index (or…
Gold Bullion Rallies in July The monthly low for gold came on July 10 at $1,204 per ounce. Gold then rallied to finish July at $1,269.44 per ounce, a gain…
Bitcoin is a global digital payment system that offers lower transaction fees than other online payment systems. It’s operated by a decentralized authority.
Gold prices tend to rise in the fourth quarter of the calendar year. Gold prices have gained an unannualized ~3.8% in the fourth quarter.
Gold (IAU) (GLD) prices usually have a strong negative correlation with the US dollar (UUP). Gold, like other commodities, is denominated in the dollar.
The US Dollar Index (UUP) struggled in the previous week as geopolitical tensions dominated markets across the globe.
The European economy has expanded in the last 17 consecutive quarters. The Eurozone’s annual growth rate is 2.1%—the highest growth rate in the last six years.
The German DAX (DAX) was up ~1.1%, Euro Stoxx (FEZ) was up ~1.1%, and France’s CAC was up ~1.4% in the week ended August 4, 2017.
On August 2, silver dropped $0.18 to close at $16.80 per ounce, while palladium fell 0.13% to end the day at $892.20 per ounce.