Week of February 27, 2022
An Eye on the Immediate Future
Gold Investors must have felt like Dallas Cowboy fans entering the playoffs last week as gold looked like it would head to the moon only to fall back to the comfort of its most recent foothold. After threatening the $2,000.00 per ounce spot price, Gold retreated to its safe zone near the $1,900.00 level that it has now set as the new level of support. We can safely expect two things. $1,900.00 looks to be a firm intermediate basis point from which to build and the war frenzy is cooked into the price already. The ceasefire for talks with Ukrainian leaders gives NATO time to decide what their role is in this conflict. Europe surely must be uneasy as to whether the Russian Premier is simply regrouping to analyze current target achievements and future plans for new sorties. New bombings would seemingly affect the spot price positively as Putin’s true intentions would become much clearer. Many analysts are fearful for the possible “Lehman Situation” which could occur by the locking out of Russian Banks from SWIFT and sanctioning all transactions with the Russian Central Bank. One must remember almost a year ago Russia completely divested their strategic reserve fund of US Dollars for Euros, Yuan, and Gold.
Stay Strategic for Now
Silver followed the yellow metal in lock step with a low for the week of $23.77 per ounce, a high of over $25.00, and then settling back to the mid $24’s. With the extended consolidation period silver has been in, when a breakout occurs, it will be decisive and swift. Silver bugs must be diligent in finding the best premiums in bullion and balancing with low population numismatic varieties for insurance on their plays.
Platinum is Attractive Because of its Resilience in COVID Fallout
Our clients are asking a lot of questions about platinum. It must be noted that platinum has never been considered a safe haven area. While 50% of platinum’s demand comes from catalytic converter manufacturing, it is surprising that platinum has not suffered more with the problems in the auto industry worldwide. There are some emerging market demands that are increasing and holding speculation where it is. Platinum demand is clearly driven by manufacturing beyond the automobile industry. With manufacturing still recovering, platinum is attractive because of its resilience against the covid fall out. The only question is how long will the recovery take?
Numismatics Very Much Back in Action
Numismatic gold and silver coins remain an extremely hot market as the Coin Shows reopen and Auctions are setting all-time records in individual coins and session totals. The Ultra Rare specimens are bringing unheard of bids creating a gap between that level and Key Dated Coins. Key Dated Coins are moving to close the gap which points to the Better Date Coins as an excellent value. Contact your GMRgold representative for portfolio opportunities in the antique and modern numismatic markets.
We do not know what the aggression by Russia and the ensuing unprecedented sanctions against Putin’s regime will cause to the macroeconomic landscape. One thing looms predictable. Twenty years from now when we look back on these times that we have created we will realize two things. We were truly living in historic economic and geo-political times, and “I wish I would have bought more gold.”