Precious Metals Are Back in the Spotlight

As of this morning, gold is up more than 10% and silver is up more than 16% since the beginning of the year. Gold stocks have also been strong, especially in the mining sector. While the S&P 500 has dropped about 1%, the Arca Gold Miners Index is up nearly 25%. Unsurprisingly, the mainstream financial media is starting to jump on the gold bandwagon.

In an article on the front page of its business section, The Wall Street Journal looks at all the factors influencing bullish sentiment for precious metals thus far in 2015. These include:

• Bubbly stock markets at or near record highs are making investors nervous.
• There are fears that European QE could trigger inflation.
• The Swiss franc’s euro peg has created massive volatility in the foreign exchange markets.
• Collapsing oil prices have money managers looking to other commodities like precious metals.
• Exchange-traded funds have increased gold holdings by 1.2 million ounces in January – the most since August 2012.
• Large speculative investors are placing their most bullish bets on metals in five months.
• The US Mint has already sold a massive amount of American Silver Eagles. Could 2015 see another sales record for the mint?

While Peter Schiff has encouraged investing in precious metals for the past two decades for fundamental reasons, it wasn’t until speculators got excited by metals that gold and silver shot up to their record highs in 2010 and 2011. Could 2015 be the beginning of another speculative rush into precious metals? Peter thinks so, because the world is going to lose faith in the ability of central banks and politicians to centrally manage global economies.

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