Quite a few market analysts and stock gurus state that the market has topped out and could be ready for a crash any day. Thursday the market fell over 700 points. Lots of others state that we got a few more good years of a rally. Both side have compelling reasons for a continuation and a crash so it is hard to know what's going happen. Actually to be truthful, no one really has a clue though. One thing I know is that when and if there is a crash, it should be good for gold, silver and the mining stocks. Gold prices still get smacked down but unlike a few years ago where it would take weeks to get gain back the losses, the yellow metal rebounds pretty quick these days.
Lots of interesting things coming up here in the next little while that could have a huge effect on both the markets and the metals. Starting Monday March 26, the Chinese government is going to start trading oil in Yuan and will be bypassing the so called petro dollar which is the US dollar. With gold always seeming to be tied to the dollar who knows whats going to happen. Also with the US administration seemingly eager to start trade wars, this in itself could have some very detrimental effects on the stock market in general.
Also starting next month, India is setting up to open a physical gold exchange. Unlike the COMEX or LBMA, this exchange will only allow trading of physical gold and NOT paper. It is said that the COMEX has 224 ounces of paper trading for every 1 ounce of physical. That's the reason why we see price suppression so much. China already has a physical exchange in Bejing that opened a year or so ago.
Another factor that comes into play here is the bond market. There is getting to be a lot chatter on various sites about the how the bond market could implode at any time due to rising interest rates. The bond market is one of the largest markets in the world with trillions of dollars rolling around in it everyday.
Other big factors that could very well have a factor on the metals is Russia, North Korea, Syria along with a host of other issues. Even the US itself seems to be on the edge of a civil war with right vs left, pro gun, anti gun etc.
Last but not least is the debt market itself whether it be mortgage debt, student loan debt, auto loans or credit cards, the entire world is soaking in debt and a lot of this debt will never ever get repaid. I was reading an article that not long ago that stated that a home sold today will never be paid off. The first owner who buys the home may end up selling the home before it is paid off and so the next owner will mortgage the same home and so on.
So where is the best safe investment? Aside from physical ownership of gold or silver, I truly like the idea of owning mining property. In the stock market right now, most gold and silver stocks are at 52 week lows and are primed for a good run. With spring here in Canada that means summer drilling programs will be underway shortly. Lots of eyes will be watching the golden triangle plays again this summer. Most notable juniors are: GT Gold TSX-V: GTT
Metallis Resources TSX-V: MTS
Garibaldi Resources TSX-V: GGI
GT Gold just closed a 6.5 million private placement at an amended price of 72 cents. This brings the company a total of 9.5 million bucks for a summer drilling program.
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