Gold is down. Silver is down. So are the Haters really hating?
Bullion.Directory precious metals analysis 1 January, 2015
By Alison Macdonald
Hungover, Partied-Out, Site Editor, Gold Bug
The popular financial media have maintained a stunningly non-impartial bearish attitude to what one would believe to be a universally hated metal – and the ultra-bugs have continued shouting $20k gold from the rooftops.
So no real change. It’s like 2014 never even happened.
But – and this is a big but – despite the apparent shunning of the nation’s Most Despised Asset Class by anyone with a modicum of investment savvy, it turns out that physical gold and it’s sibling silver have been seeing record volume in 2014.
And not as we would believe from the popular meme by those gold-hungry despots in the distant East (although there have been some significant purchases). And no, the old Red Enemy at the Kremlin have not been hoovering up our “scant” supplies to facilitate an evil plan of world domination (although, again, there have been some significant purchases).
Have the Demon Bankers been refilling their “empty” vaults? Of course not (although, once again, there have been some significant purchases).
The crazies. It must the the crazies yes? The mullet-wearin’ gun-totin’ loons buying junk silver coins and divisible gold bars to see them through an impending zombie alien invasion?
Yes of course the evangelical gold-bugs are buying. They (and I count myself amongst the more level-headed fringes of the sub-culture) are ALWAYS buying. Always stacking. Always getting’ ready for the proverbial shit to hit the proverbial fan.
But despite our popular websites and webcasts, youtube channels and unboxing porn we are – alas – not legion.
So if no-one apart from the crazies, the Chinese, the Russians, Central Banks and The Banks Too Big To Fail have been buying physical gold, then where in heck could all the gold be going?
It turns out that, er, actually Joe Average American – has been filling his or her cowboy boots with fire-sale precious metals. One can only guess they don’t watch celebrity analysts or read the financial pages.
See, I’ve been speaking to a source at one of the leading Gold IRA providers in the US. If they are to be believed (and I have no reason to doubt their confidential figures) 2014 saw near exponential growth in gold and silver purchases with monthly figures seeing cumulative multiple-million month-on-month growth.
Should that growth be being replicated across the industry (and again I have no reason to doubt that it isn’t) then retirement planning Americans seem to have cottoned on to the fact that precious metals are cheap.
They were cheap last year and they are cheaper this year – which means pre-retirees can cram more shining bullion into their tax-efficient retirement account for every paper dollar they wish to convert.
Silver saw a $15 handle in 2014 and in an instant became the 50-something’s best friend.
IRAs are by their very nature long. Super-bearish sentiment is music to the ears of someone taking a long position in metals and when there’s blood on the streets, as someone surely once said, it’s time to buy a mop.
Will prices go lower in 2015? Our analyst Terry thinks so and he’s not alone.
Sadly – as we enter this new year, 2015 may not be the year that gold hits the stratosphere. The ultra-bugs may once again see their $20k predictions leave them with golden yolk on their faces.
No, the gurus I’d like to be right are most likely wrong and the celebrity analysts I try to ignore are in all probability right.
If you’re looking to trade gold, to flip it’s ass for profit then that’s bad news.
But in all honestly, who the heck flips physical bullion? For a start it’s too heavy.
We can call $1 silver and $700 gold every day of the week. We may even see silver get into the single figures this year and gold return to a decade old low… but all the time those legions of middle-aged, middle-income, middle-Americans will continue to quietly, relentlessly take advantage of the buying opportunity that low prices offer.
And so will the rich. And the Russians. And the Chinese. And the Central Bankers. And the Banks Too Big To Fail. And the Crazies.
To summerize. Physical Gold and Silver are awful. Everyone says they hate them.
Except they don’t.
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