And looking good today. Here’s how the intro to IKN646, out a couple of days ago, wrapped up its bullish argument on gold, copper and even silver:
These days, geopolitics and Central Bank purchases don’t change the price of gold, its important price changes are effects of the “big rules” of world economics applied to the most basic of monetary building blocks. Regarding those, you have the right to believe “Whatever It Takes” will either not be used or will not work and the world will slip in to recession. If so, you shouldn’t be holding gold. Or mining companies, for that matter.
For the rest of us, we aren’t here to argue the economics or the politics of inflation, instead we consider it a fact and try to make money. For whatever reason, prices for goods and services are now rising around us. We know that the price of “stuff” never rises without gold and you don’t need to be of the Austrian school to agree, even widely differing economic schools of thought will line up behind that statement (they’ll still argue about the causes, though). However, we haven’t had a big move from gold recently and that’s not so surprising, either. Gold’s role in times of economic stress, aside from being the safest of all anchors, is also to indicate when excesses are apparent and is why its progress is never a smooth line. Even through “Whatever It Takes”, the world financial and monetary authorities haven’t had the gas pedal to the floor at all times, it’s only recently that the excesses of the recovery are showing (fuel, logistics, employment, etc). Gold may be king, but it gets big moves in dollar terms as well, they happen with changes in trends and so, with higher prices for “stuff” now prevalent, the next turn for gold in the new inflationary environment can only be in one direction.
Bottom line: Be they copper or gold opportunities, your author is unashamedly bullish on the mining sector in 4q21, it ticks the boxes for right time, place and price. Exact timing of any tidal change is always difficult (in fact it’s luck), but unless the market truly collapses it’s only a matter of time before gold moves higher.