The euro has been strong recently. The EUR/USD rate shot up to a two-year high, to a level of 1.21. But not only the euro has been “strong” against the dollar. Better said, the recent euro strength can for the most part be explained by recent dollar weakness. The gold price in dollars went up as a result, even exceeding $1300 per troy ounce, but gold prices for investors in the Eurozone have remained mostly flat. Where is the EURUSD heading next?... »
Where Is the EUR/USD Heading?
September 13 2017
Avoid (Physical) Gold ETFs! The Hidden Secret of ETFs
September 6 2017
Exchange traded funds (ETFs) are hot. Everybody is buying. The mantra of passive investing has created a billion-dollar industry for these “trackers.” And gold is not staying behind. One of the world´s largest ETFs is the SPDR Gold Shares Fund (GLD), a gold-backed ETF, which is supposed to track the gold price. And the GLD ETF is perhaps among the world´s “safest” ETFs, but let us not get started on junk bond index ETFs. ETFs suffer from deep structural flaws whenever there arises a... »
Jackson Hole 2017: What Happened?
August 30 2017
Friday, August 24, 2017: the annual gathering of central bankers and policy makers in Jackson Hole has attracted extensive press coverage. Janet Yellen – the current Chair of the Federal Reserve – gave a speech. Not in Washington or New York, but in the quiet little town of Jackson, Wyoming.... »
Will September Determine the Monetary Course of the Fed and the ECB?
August 23 2017
Let us be blunt for a moment: interest rate hikes by central banks, especially the Fed, are generally bad news for precious metals. Or better said: a greater number of rate hikes than the market currently expects, mean bad news for precious metals prices. Whoever bases his or her expectations on what the Fed casually promises between lines, is assuming that the central bank based in New York will raise the official rate once more this year and another three times in the course of next year.
If this pans out to be right, then between now and New Year’s Eve 2018 we will have a total of four more rate hikes. In that case, it would not surprise if precious metals will encounter some headwinds from that direction. However, in case there will be less than four rate hikes in that period, do... »