Time Series Analytics Europe

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For sophisticated investors only

June 3rd 2020

We have been publishing our thoughts on linkedin for quite some time with a focus on precious metals. Today, we offer you our two cents on "the world"

We are facing a generational crisis and a systemic crisis. The pandemic is just the straw that broke the camel's back. The writing has been on the wall for some years but the "everything bubble" continued relentlessly. Trillions of stimulus after 2008 did not go into the economy but inflated financial markets. Now trillions more will be thrown at the current problems without solving anything  but debasing currencies.

Precious metals' pricing on the exchanges is de-coupled from the physical. Only the physical matters. If you do not own gold, silver, .. now, you may find it difficult to buy. Supply has faded. The lucky ones that own the physical need to hold it outside the banking system. Remember, if you can not touch it, you do not own it. And when hyperinflation comes and you want to "feel" the yellow stuff, it will not be there.

We were wrong on stock markets. Once again, stimilus money is going straight to Wall street while main street is largely left in the cold. This may increase tensions further between the once getting the bail-out money and those who really need it but have to wait (Cantillon effect). Still, while we probably miss out on short term stock gains, we are not comfortable commiting while this bubble is being inflated a final (?) time.

Most importantly, The Treasury is now in charge of the Fed. This may have surprising side-effects.

Godspeed,

Marc

 

 

 

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