Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

Major Players Predicting Higher Gold Prices for 2017

  by    0   2

Despite the recent slump in gold prices, many influential analysts like Raoul Pal and firms like UBS are predicting a strong showing for gold in the next 12 months. Their beliefs are based on strong indicators of a looming recession, negative interest rates, and a downshift in global trade.

gold bars

Influential investor and founder of Global Macro Investor, Raoul Pal, predicts a U.S. recession within the next 12 months and sees gold as the best currency to have on hand. In a MarketWatch article, Pal said the recent drop in gold prices is short-lived and that continued negative interest rates and a coming economic collapse will move more investors to gold for wealth protection. Greater demand will then drive prices higher.

“As we get to negative interest rates, gold is a good place to park your cash,” says Pal, “I’m not a gold bug … but this is the currency I would choose now … All the really serious thinkers are interested in gold.”

One of the strongest, most accurate indicators of economic health for Pal is the Institute for Supply Management index (ISM), a survey based on more than 300 manufacturing firms. The ISM rose slightly in September over the previous month to 51.5%. However, many economists like Pal still see many challenging conditions within the manufacturing sector, not to mention the unrealistic rosy economic pictures being painted by politicians and the Fed.

“There’s a difference between the narrative, which is what you’re being told, versus the reality of the economic data,” he states. “It’s in no one’s interest ahead of the election to say the U.S. economy is a mess — [that] world trade freight shipments, container shipments, retail sales, restaurant sales, factory orders, durable orders are all showing a recession.”

Also not a fan of U.S. stocks, Pal believes the ISM correlates well with U.S. assets. “It peaked in 2011 and has been bouncing around 50 for a while now. The moment it starts to get to 47, 46, the odds of a full-on recession explode to 85%. We’re very close now, getting to the point where the probability is very high.”

The former Goldman Sachs alum also points to the election cycles and historical precedents citing that since 1910, every two-term election has “had a recession within 12 months.”

Financial firms like UBS are also seeing signs of a gold rebound within the 6-12 months based on the continued low interest rates. Strategists at the bank’s Chief Investment Office Wealth Management Research arm seeing gold doing well as long as “the Federal Reserve sees no reason to raise interest rates in a hurry.”

HSBC Group Inc. are advising clients to get into gold based on “the prospect of a looming downward shift in globalization.” Given the US election, Brexit, and other economic uncertainties, many countries are taking an isolationist stance with regards to trade, which according to HSBC analysts means good news for gold.

The firm’s Chief Precious Metals Analyst James Steel said in a note published on Friday that “demand for gold is often stimulated by the same factors that fan protectionist and populist sentiment” and that “abrupt declines in cross-border trade, investment and immigration, the dislocation of global economic policies, and a beg-thy-neighbor approach to trade is almost tailor-made for higher gold prices.

Negative interest rates, global insecurities, and low gold prices make it a great time to buy gold, silver or move part of your retirement into precious metals.
 

Get Peter Schiff’s latest gold market analysis – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!


Related Posts

CPI Housing Cost Calculation Hides True Extent of Inflation

The government CPI data for August came in slightly under expectations. Nevertheless, a 0.3% month-on-month increase in prices is significant. And a dig into the numbers reveals something wonky. The way the government calculates housing costs drastically understates rising prices and skews overall CPI to the downside.

READ MORE →

Gold’s Growing Role in Healthcare

A couple of years ago, CNBC commentator Jim Leventhal made a pretty astounding comment. When asked about gold, Leventhal said he had no interest in it because gold has no uses as a metal. Of course, this is nonsense. Gold has a wide range of uses in sectors ranging from jewelry to high-tech electronics. And […]

READ MORE →

Federal Budget Deficit Continues Its Relentless Upward Spiral

The US government ran a $170.64 billion budget deficit in August, pushing the total fiscal 2021 budget shortfall to $2.71 trillion with one month to go, according to the latest Monthly Treasury Statement. The mainstream media spun this as good news, noting that the August deficit was 15% lower than the $200 billion spending gap […]

READ MORE →

Incentives Matter: Unemployment Edition

Both Janet Yellen and Joe Biden insisted “enhanced” unemployment benefits weren’t incentivizing people not to work. The numbers prove them wrong.

READ MORE →

Producer Prices Surge Again in August

Producer prices came in hot again in August, charting the bigger annual gain in nearly 11 years. This indicates “transitory” inflation isn’t going away any time soon. The PPI for August rose 0.7% month-on-month. Economists were forecasting a 0.6% rise. This follows on the heels of two straight months with producer prices increasing 1.0%.

READ MORE →

Comments are closed.

Call Now