Ultimately, the free market decides the cost of everything…
Mark discusses the overall world economy and how China is evolving in manufacturing and a stronger currency. There is a lot of tension between China and the United States. Gold could become a tool of nations in this economic struggle. A lot of gold the Chinese have acquired, and mined has not been declared to the world.
There is a lot of electronic manipulation of precious metal markets, and banks have been prosecuted over the years. There is concern about dollar assets if gold is rising, so U.S. authorities have a high interest in suppressing the gold price. There are conspiracies all the time, and banks often conspire to make profits. Ultimately the free market decides the cost of everything along with supply and demand.
The silver-gold ratio will revert to the mean soon, perhaps 30 to 1 or better. Having a substantial allocation of gold and silver in your portfolio makes sense. It will only take a tiny trickle of the hundreds of trillions in world assets to shift direction to have a dramatic effect on precious metal prices.
Time Stamp References:
1:05 – Currency and trade wars.
7:00 – Paper and electronic manipulation.
14:00 – Platinum, palladium and silver.
18:30 – Silver as an industrial and monetary metal.
23:00 – Warren Buffet and talking your book
23:45 – The real value of gold.