The Gold & Metals Weekly Navigator (May 24th, 2020)

Weekly Performance Recap – Silver Gets Bid

This week we saw a disconnect between the performance of gold and silver relative to the market. S&P 500 rose 3.2%, while gold fell 0.4% and silver rose 3.4%.

Even with gold lagging this week, the market kept a reasonably strong bid for junior gold miners (NYSE: GDXJ).  Senior gold miners (NYSE: GDX) sold off on the week -2.8%, the stocks took a breather after strong run since mid-March – senior gold miners are up 21% YTD.

Precious Metals & Equities Performance for May 18th-22nd, 2020

Source: YCharts

The gold and silver ‘paper’ ETFs continue to attract significant investor interest, with holdings in both hitting record highs.

Fed Chairman Powell Fessing Up

A fantastic clip of Federal Reserve Chairman Jerome Powell acknowledging on 60 Minutes that the central bank is indeed ‘flooding the system with money’.

Meanwhile the U.S. Fed continues to march its balance sheet higher, now topping over $7 trillion, this included $1.8 billion of corporate debt ETF purchases.

It took two years for the Fed to shrink the size of the balance sheet from $4.5 trillion to $3.7 trillion, it has now taken 2 months to double it.

Emerging Markets will be Ground Zero for Hyperinflation

A fantastic post from Santiago Capital explaining the pathway to hyperinflation in periphery economies.

Emerging market central banks will print money to offset their significant financial strains during the COVID-19 financial crisis, however global demand for these banana republic currencies is non-existent which causes a flight of money out of these currencies into safer assets – namely the US dollar and gold.

 

Small Cap Gold & Silver: Equity Financing Deals

Over the last week we have seen a slew of equity financing deals in the week, a definitive sign that investor risk appetite in the sector has picked up meaningfully.

Of note, Eric Sprott has been particularly active, he has financially backed at least four of the equity offerings.

Gold & Silver Equity Financing Deals

Source: Capital 10X

 

 

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The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Capital 10X hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.

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Capital 10X gets down to the real money business, actionable financial insights for traders and investors. We analyze company earnings, interview management teams and help teach the fundamentals of financial analysis and options trading. Our mission is to hunt for genuine 10 baggers.
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