Gold stocks have suffered heavy collateral damage following the Federal Reserve’s hawkish surprise late last month, which ignited enormous gold-futures selling by American speculators.  This devastated sector has been battered back down near last summer’s deep secular lows.  But these gold-stock price levels are fundamentally absurd, the product of extreme and irrational sentiment that can’t persist for long.
Today’s gold-stock price levels are the greatest fundamental disconnect in the entire stock markets, an epic opportunity for contrarian investors and speculators! 
The entire gold-mining industry is trading as if the price of gold, the overwhelmingly-dominant driver of its profits, was just a small fraction of prevailing levels.
Gold stocks are radically underpriced fundamentally based on their current and future earnings power.

fall plungeGold has enjoyed a strong new uptrend in recent months following last summer’s extreme gold-futures shorting attack.  But speculators returned with a vengeance this past week, aggressively dumping gold futures again following a hawkish surprise by the Fed.  The resulting gold plunge shattered its support, and thrust sentiment back into hyper-bearish territory.  But gold-futures shorting soon reverses to big buying.

dynamiteWith the Federal Reserve’s first rate-hike cycle in nearly a decade looming, traders are working overtime trying to divine its timing and impact on the markets.  They are closely monitoring the same employment and inflation data the Fed will use to start tightening.  But there’s another little-discussed concern for the Fed, the solvency of the US government.  The Fed’s zero-interest-rate policy has spawned a grave US debt bomb.

beach ballSilver is finally showing some signs of life after suffering a dark year.  The epically-bearish sentiment that bludgeoned this metal to major secular lows is cracking, with a strong rebound rally now underway.  And this recent buying is likely just the earliest vanguard, as silver remains deeply undervalued relative to its primary driver gold.
Silver will need an utterly massive upleg to fully mean revert to normal levels.

Zeal101615ADespite gold blasting higher this month, this metal remains deeply out of favor among investors.  They have shunned it for years thanks to extreme central-bank money printing levitating stock markets.  This slayed demand for alternative investments, led by gold.  But the resulting radical underinvestment in gold today is super-bullish.  Vast capital inflows will be necessary to return gold investment to normal levels.

launch rocket verticalThe left-for-dead gold stocks have rallied dramatically this past week, surging to a major breakout.  This pivotal technical event reveals the hyper-bearish psychology plaguing this sector in recent months is dissipating, paving the way for investment capital to return.  And given the fundamentally-absurd price levels in this battered sector, this new gold-stock buying is likely just the initial vanguard of a massive new upleg.

hyperinflationTraders today universally believe inflation is dead, that there is no persistent decline in the purchasing power of money.  That’s what government price indexes around the world are indicating.  But this false notion is one of recent years’ main Fed-conjured illusions.  Price inflation is the result of rising money supplies, and they have been skyrocketing
Serious risks are mounting that they will spill into price levels.

Gold was beaten to a pulp as the Fed seduced investors into forgetting prudent portfolio diversification.
With the Fed shifting from record easing to a years-long tightening cycle, the fortunes of the markets are due to reverse.
The stock markets are going to face a stiff headwind for years, forcing investors to diversify back into alternative investments led by gold. 
Is your portfolio ready for this monumental shift?

Zeal090415AThe epicenter of gold’s intractable weakness over the past couple years has been the Federal Reserve’s upcoming rate-hike cycle.  Everyone assumes higher interest rates will devastate zero-yielding gold, leaving it far less attractive.  This premise led investors to avoid gold like the plague, and speculators to short sell it at wild record extremes.  But provocatively, history proves gold thrives in Fed-rate-hike cycles.

silver updateThe smaller gold miners and explorers have suffered catastrophic stock-price losses in recent years.  These extreme declines have led investors and speculators to assume that much of this sector won’t survive lower prevailing gold prices.  But nothing could be farther from the truth.
The hated and left-for-dead junior-gold sector is not only very strong financially today, but could still thrive at much lower gold prices.

falling-bearThe US stock markets just suffered an extraordinary plunge, shocking traders out of their complacency psychosis.
This cast the foundational premise behind recent years’ incredible stock-market levitation into serious doubt.  Traders are finally starting to question whether central banks can indeed manipulate stock markets higher indefinitely.
Any wavering in this faith has very bearish implications for stock prices.

falling-bearThe entire gold-mining sector was crushed last month, suffering a full-blown panic.  This was triggered by an extreme shorting attack on gold by American futures speculators.  As fear-blinded traders rushed for the gold-stock exits, they claimed their selling was rational because gold miners’ very existence was threatened by such low gold prices.
But that’s a total fallacy, this sector has no problem weathering sub-$1200 gold.

falling-bearWith gold languishing near deep secular lows, its technicals look hopelessly broken.  Sentiment is off-the-charts bearish, with traders universally convinced gold is doomed to spiral lower indefinitely.  But gold’s weakness this year is very deceiving, as it wasn’t the product of global fundamental supply-and-demand forces.
Extreme record shorting by American futures speculators spawned these artificial lows.

fall plungeGold has certainly had a rough summer, facing withering selling pressure from record futures shorting.  The resulting new secular lows have greatly exacerbated the already-extreme bearish psychology long plaguing this metal.  But considering the howling headwinds gold has suffered in recent years, it has actually proved amazingly resilient
This indicates strong latent demand due to accelerate as sentiment shifts.

hyperinflationGold stocks suffered a full-blown panic this past week!  This exceedingly-rare magnitude of selloff was triggered by extreme futures shorting intentionally executed to force a flash crash in gold.  After gold’s major multi-year support failed in this Machiavellian onslaught, gold stocks plummeted.  The levels of fear were so epic that this entire sector was slammed much deeper into fundamentally-absurd price territory.

my-shorts-on-fireWhat if the withering selling pressure devastating gold and silver this summer is artificial?  What if the traders dumping the precious metals don’t actually own them in order to sell them?  What if 2015’s apparent glut of gold and silver has been mostly borrowed first and then sold?  And what if these short sellers used extreme leverage to dump these metals?  This scenario radically changes precious metals’ outlook.
A record short-covering frenzy is imminent…

falling-bearGold and silver are languishing near major lows, trudging through the barren sentiment wasteland of the summer doldrums.
The major factor behind this weakness is extreme shorting by American futures speculators.  But their heavily-bearish bets are actually VERY BULLISH for both precious metals.
Not only do these traders as a herd always bet wrong at price extremes, their shorts are guaranteed near-future buying.

falling-bearThe US stock markets were quick to rally after the Federal Reserve did nothing at its June policy meeting.  Traders love the endless dovishness gushing forth from this Yellen Fed.  But their complacency is very misplaced.  It was epic Fed easing that fueled the stock-market levitation of recent years.  So the Fed shifting away from these extraordinary policies is a major downside risk for these Fed-inflated stock markets.

gold bottomGold remains deeply out of favor, languishing near major lows.  Traders are still convinced gold is going nowhere, and want nothing to do with it.  But provocatively that’s par for the course in early June, when gold slumps to its most-important seasonal low.
Gold’s seasonals are now bottoming, just ahead of the usual major surges in global gold demand coming in late summer and autumn.  This is a fantastic time to buy.

Zeal060515AGold remains deeply out of favor thanks to global central banks’ extreme money printing.  This fueled a global stock-market levitation that has temporarily short-circuited normal market cycles, leaving investors infatuated with stocks to the exclusion of prudent portfolio diversification.
This has left them radically underinvested in gold, which sets the stage for massive mean-reversion buying when they inevitably return.

down goldThe great endeavor of investing can be distilled down into four simple words, buy low sell high.  They are so basic, so resoundingly clear, that even a child can understand this principle.  Yet still the great majority of investors never achieve significant success.  Even while full-well knowing the core idea of investing, they end up buying high and selling lowThat treacherous struggle of investing must be overcome.