Donald Trump’s emergence as the Republican frontrunner and possible future
U.S. President is causing some gold and investment analysts to suggest
diversifying into gold according to the Wall Street Journal.
Donald Trump – Gage Skidmore via Commons.wikimedia.org
From the WSJ:
The other winner from Super Tuesday could be gold.
With Donald Trump solidifying his status as the front runner in the
Republican field, some investors and analysts watching from overseas say that
the ascendancy of the brash New York businessman could rattle global markets
as the November presidential election inches closer. Nervous investors, they
say, could pile in to gold and other safe-haven assets as an insurance
policy.
The journal quotes David Govett of London-based commodities broker
Marex Spectron:
“The mere thought would suggest a good opportunity to buy gold,” said
Mr. Govett, who heads the firm’s precious-metals trading desk.
“Who knows what could happen should he be handed the keys to the White
House,” said Mr. Govett.”
James Sutton, a London-based portfolio manager on the global natural
resources equities team at J.P. Morgan Asset Management concurs:
“If there’s any uncertainty regarding the U.S. election and the
potential for a slightly off-center candidate, whether that be Sanders or
Trump winning the election, then I can see a scenario where that’s bad for
the dollar.”
It is important to note that gold’s fundamentals are very sound and the
possible “Trump gold factor,” if there is one, is only one of a myriad of
fundamentals that are driving the gold market.
As Mining.com comprehensively
notes
Following three down years, many factors have been driving gold’s
resurgence in 2016:
- Geopolitical turmoil – spreading from the Middle-East into Europe
and beyond – burnishing gold’s safe haven status
- Doubts about the health of the global economy and financial system
and the longer-term impact of the slump in oil prices forcing investors to
look for insurance policies
- Uncertainty surrounding the future of the European Union and the
possible fallout from a Brexit
- Slumping stock markets around the world pushing investors into
alternative assets particularly gold
- Physical gold investors jumping back into ETFs – more than wiping
out all of last year’s outflows less than two months into the new year
- Skepticism about further rate hikes in the US and negative interest
rate policies in a growing number of developed economies around the world
lowering the opportunity costs of holding gold
- Continued central bank buying and a belief that the strengthening
trend in the US dollar is over for now
- First indications that inflation may be creeping back into the
financial system making gold attractive as a hedge
- A realization that gold around $1,000 an ounce represents an
historical bargain buying opportunity
Uncertainty regarding the U.S. presidential election will likely aid gold.
But gold’s outlook is bright whether Donald Trump, Hillary Clinton or the
Messiah himself or herself becomes President.
Gold’s fundamentals are positive given the very high degree of
macroeconomic, monetary, geopolitical and systemic risk in the U.S. and
indeed the world today.
LBMA Gold Prices
03 Mar: USD 1,241.95, EUR 1,141.48 and GBP 882.24 per ounce
02 Mar: USD 1,229.35, EUR 1,131.53 and GBP 881.54 per ounce
01 Mar: USD 1,240.00, EUR 1,141.70 and GBP 886.09 per ounce
29 Feb: USD 1,234.15, EUR 1,131.46 and GBP 890.95 per ounce
26 Feb: USD 1,231.00, EUR 1117.58 and GBP 878.87 per ounce
Gold and Silver News and Commentary
Gold futures mark best settlement in almost 3 weeks – Marketwatch
Gold slips as risk appetite back in vogue, ETF inflows support – Reuters
India’s Love Affair With Gold Tested as Tax Fight Spurs Shutdown – Bloomberg
There’s gold in them there rivers – New high-tech search – Independent
Silver American Eagle sales still restricted by weekly allocations – Coin
World
‘7 Real Risks To Your Gold Ownership’ – New Must Read
Gold Guide Here
Global Central Banks Continue Longest Gold-Buying-Spree Since Vietnam War
– Zero Hedge
Russia aims to overthrow dollar and West with gold – Pravda
COMEX vs Private Gold & Silver Eagle Stocks – SRSrocco Report
Interest on Gold Is the New Tempest in a Teapot – Gold Seek
Silver Bullion Coin Sales Flying – Daily Coin
Read more here
