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Gold & Silver Can't Be Stopped Now - This Is Why! | Bald Guy Money | YouTubeToText
YouTube Transcript: Gold & Silver Can't Be Stopped Now - This Is Why!
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Summary
Core Theme
The core theme is that despite potential market volatility and geopolitical events, gold and silver prices are poised for significant growth due to fundamental shifts in central bank policy, the weakening of the US dollar and Euro as reserve assets, and the Federal Reserve's likely pivot to lower interest rates.
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With so much gold concentrated now in
the hands of central banks, entities
that are not subject to margin calls,
they are not trading gold to make a
profit, but they're rather holding it as
a reserve asset. This is not the same
market that existed during previous
crashes. Hello everyone, welcome to Bald
Guy Money. And with a plan that Ukraine
allegedly agrees to in place to end the
Russia Ukraine war, I was asked this
week if I was concerned that it would
crash gold and silver prices. And to be
perfectly straightforward, the answer is
no. First off, because it's good to see
wars end, but number two, the conflict
by itself has had little to no impact on
the long-term prices of gold and silver,
as we saw them crash in the months
following the start of the war due to
central banks around the world,
including the Federal Reserve, raising
interest rates in their fight against
inflation, showing us all, that it's
rate policy that drives metals prices
more than war, along with the now
irreversible reputational damage done to
the US dollar and the euro as reserve
assets as a consequence of what they did
during the war when they froze Russian
assets in 2022 and later approved their
outright confiscation in 2024 which has
just pushed central banks increasingly
towards gold and just can't be undone at
this point even if a peace deal is
reached and with the Federal Reserve now
expected to lower rates again in
December, which is something I warned
you all about back on November 16th when
I said gold and silver could retest
their all-time highs as soon as
December. There is literally nothing
stopping the gold and silver train at
this point. And that's precisely what I
want to cover in this video, starting
with why the Federal Reserve has no
choice but to pursue policy that will
result in higher gold and silver prices.
with some brand new points I want to
bring to your attention. Once that's
covered, I want to reopen the topic of
metals and mining stocks in a market
crash to show you all what's really
different this time and why the
relationship between gold and the US
dollar and a market crash may never be
the same again. And that will also
contain some information on how I think
you can protect your mining stock
positions while earning some money via
dividends at the same time. Now, just
before we dive in, I want you all to
know that this bonus midweek video has
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jumping in, as I said in my Sunday
video, we need to focus on the signal
when it comes to gold and silver that
will drive prices over the long term,
not the noise that is intended to make
us doubt and sell gold and silver at
current prices to institutional
investors, including central banks who
are only more than happy to buy at these
prices, just like they did in October
and November 2024 when metal's prices
pulled back only slightly. People called
the top of the metals market and central
banks piled in to make their largest
purchases of the year. So, don't be
fooled here because it wasn't long ago
that the mainstream financial media was
taking Jerome Powell at his word when he
said the Fed might not cut rates in
December, which applied pressure to gold
and silver prices as well as mining
stocks, which we will cover a bit more
shortly, but pulled back 19% in early
November as measured by the GDX large
miners ETF, despite the fact that metals
hadn't really moved that much. And it's
why I was preaching patience with the
mining stocks only a couple weeks ago.
Because just like a dad telling his kids
that he's going to turn the car around
if they don't start behaving, Jerome
Powell's words look like empty threats
just weeks after he said them. with the
Federal Reserve not only expected to cut
rates in December, but expected to cut
them to 3% or even lower by April of
next year, keeping us, of course, on our
path to real negative interest rates by
March or April of next year, which will
impact gold and silver in the opposite
way that raising rates did in 2022 when
rates went from negative to positive and
metals prices came down significantly.
despite the start of the Russia Ukraine
war which many had incorrectly thought
would only result in higher metals
prices no matter what. So I hope that
relationship between real interest rates
and gold and silver prices is now clear
for everyone because people who are
concerned about wealth preservation and
there are plenty of such people in the
world. They are going to flock to the
only safe haven left once real official
rates go negative early next year and
buying US bonds becomes even more of a
losers investment. And that only safe
haven, the last place to find safety and
security in what I think we can all
agree is not only an overpriced market
but an extremely volatile market is gold
and to a lesser extent silver. Now, to
those of you saying that there's no
guarantee this is going to happen, let
me tell you this. Even if they don't cut
rates in December, the Fed is backed
into a corner with mounting pressure to
prioritize saving the economy, which
despite information out there claiming
it's great, it's not really all that
great. As you can see here in the ADP
private payroll data, which shows the US
private sector has lost jobs over the
last three weeks with official
government data released just a couple
weeks ago, including revisions for the
month of August showing that instead of
adding jobs in the month of August, the
US market actually lost jobs. And I
think where you can most clearly see
this is when we look at the Russell 2000
index, which is a stock index made up of
smaller cap US companies. And in my
opinion and the opinion of many other
experts out there, it is a great
reflection of US economic health. And
this index is up only 1% today versus
its 2021 highs despite major growth in
the S&P 500 and an official increase in
market prices according to the CPI of
17% over the same period of time. And
what this tells me and the Fed
definitely sees this too is that the US
economy is already in recession. And it
means not only more rate cuts are coming
in 2026 and negative real interest rates
and probably even quantitative easing,
but it means higher metals prices are
also on the way. And the market is
making that perfectly clear as
conviction in owning metals remains high
with gold price currently consolidating
down only about 4% versus its high 27
days after making it in October. Whereas
gold had already lost 12% in 2011, 27
days after making its high and fell 22%
in the 27 days after making its high in
1980. And when we look at silver, which
usually overreacts to any negativity in
the market, we all know that. And is a
great leading indicator of gold and
silver market tops. It's holding up
extremely well after making its recent
high, down only about 2% from the high.
29 days after making it. While silver
price had already gone down 23% 29 days
after making its high in 2011 and nearly
30% 29 days after making its high in
1980. And that's because real investors
know what's going on here and they're
holding their metals while traders are
the ones contributing to short-term
volatility, which has decreased notably
as a healthy fear of shorting silver has
been instilled in these traders because
even as silver is above $50 an ounce,
short sales volume on the SPAT physical
silver ETF has crashed since October
20th. It is extremely low as you can see
on the chart here. And from my point of
view, this is just another very
promising sign for both gold and silver
moving forward. So, with that covered,
it's time for this video's viewer
question, which comes from Mo Abbott,
who wants to know, "What will happen to
metals and miners if the stock market
crashes?" And it's a great question
because, as far as I'm concerned, market
fundamentals have significantly changed
over the past few years. and not enough
analysts are correctly building those
changing fundamentals into their models
or communicating this to people via
social media. So, jumping in to those of
you who are worried about the safety of
your gold, silver, and mining stocks in
a market crash. Luckily, we experienced
a mini crash earlier this year with the
S&P 500 pulling back about 20% from
midFebruary to early April. And that's
versus a 25% pullback from the end of
2021 to October 2022. So I think we can
all agree when I say it was significant
enough to trigger some margin calls
which is forced selling in the market
even of good profitable assets which is
done to secure loans that have been made
to traders and is usually what hits
precious metals the hardest along with
liquidity crunches. Now, in addition to
that pullback, which you are looking at
on this crazy chart here, it can't
exactly be classified as a flash crash
since it took place over about 50 to 60
days depending on how you measure it.
So, this was a real crash, albeit a mini
one. And if there's anything we learned
from it, it's that gold is in a
completely new reality versus where it
used to be as price moved up during the
majority of the crash, only
significantly pulling back during a
3-day period by about 5%. In fact, it
was 4.8%
during which time the S&P 500 pulled
back about 13%. And despite an initial
sell-off in the mining stocks measured
by the GDX here, they turned around by
early March, which was very early in the
crash. And they even started to move up
with gold even as the S&P 500 sold off
with silver being the only one of these
three to have really dropped below its
pre-crash price during the final days of
the crash. Now, I know that's probably a
lot for all of you to take in, but it is
very significant because common wisdom
tells us that everything sells off in a
market crash, even gold, and that it's
the US dollar that goes up. But during
those 50 to 60 days, as the S&P 500 sold
off, the US dollar went from 107 on the
US dollar index down to 103 as the price
of gold went up. never closing below its
pre-pullback highs despite the major
market crash that was happening. Now,
this doesn't mean that gold couldn't
have pulled back more if the crash had
continued. But what I'm saying is that
with so much gold concentrated now in
the hands of central banks, entities
that are not subject to margin calls,
they are not trading gold to make a
profit, but they're rather holding it as
a reserve asset. This is not the same
market that existed during previous
crashes. Which means as we come back to
this image here, the pullbacks won't be
as serious for precious metals or even
the miners as they have been during
market crashes of the past. Even if we
see deeper corrections for silver versus
gold, which we've always seen deeper
corrections for silver versus gold
during major market volatility. Now,
with that said, since we can't predict
when a crash is going to happen and from
what levels gold and silver will pull
back from and really what levels they're
going to pull back to, I think it's more
important to focus on the one thing that
stayed the same earlier this year versus
past market crashes. And that is once
the market started to come back, gold,
silver, and the mining stocks led the
way back up with the fastest rebounds.
and the largest gains. Now, just before
we finish this video, I want to reveal
something to you all for the first time
here on YouTube that I think is very
important on the topic of mining stocks,
which are rebounding fantastically right
now, as I told you all they would a
couple weeks ago. But what I want to
share with you all is one strategy that
I think is a good one in the spirit of
protecting your downside risk on mining
stocks while also earning some great
money at the same time in something that
I think is objectively undervalued right
now. And that is oil stocks. And the
reason I took a position in them is
because as you can see in the image here
on the screen, fluctuating oil prices
have historically impacted mining stock
prices as higher oil prices negatively
impacts their profitability and lower
oil prices positively impacts their
profitability since of course they use a
lot of oil in their operations. Now I
think metal's prices are strong enough
that the miners could shrug off higher
oil prices. So, it's not a major concern
of mine, but with oil price at $58 a
barrel, below its 5-year average of $76
a barrel, and even below its average
price since 2000, which is about $64 per
barrel. I also see value here as the
upside opportunity is much larger than
the downside risk. And for transparency,
I am invested in some oil and energy
stocks, including Exxon Mobile, which is
currently paying a 3.6% dividend through
an ETF I own. And what I want to say to
anyone like Mo who asked the viewer
question for this video who may be
concerned about how a market crash is
going to impact the mining stocks, what
I think you should be concerned about,
where I think you should put your focus
is on the structural threats to mining
stocks or any other stocks you own which
can have a longer term impact on their
value than a temporary market crash. And
I think oil price has proven to be such
a threat for the mining stocks in the
past. And it's why I think having some
exposure to those oil stocks makes sense
as a hedge to mining stocks. And for
those of you who are interested, I've
even provided some of the topline data
for Exxon Mobile here on the screen,
which again is a stock that I own
through an ETF along with value
comparisons versus its peers, which you
can get from the investing pro tool from
investing.com that I think is extremely
useful for anybody considering this as a
hedge to their mining stocks. And in
addition to that, anyone who's already
signed up for the investing pro tool,
and I know that it's a lot of you out
there, or maybe you're considering
signing up for it today since the price
is so good, they also have an
interesting energy elite portfolio that
I want to bring your attention to. And
it's in the prop pick section with some
very interesting energy related options
that are lowrisk but pay fantastic
dividends. So for anyone who thinks the
market is just overvalued right now and
I think the market is overvalued right
now and that good deals apart from
metals and mining stocks are just too
hard to find. I think diversifying in
this direction into some of these energy
stocks could be very helpful as I've
done it myself. And the investing pro
tool of course can be very useful in
doing it the right way while also
securing yourself the tools that you
need to research mining stocks before
you buy them instead of just taking for
example a YouTuber's word for it. So as
we finish I just want to thank investing
pro from investing.com for making this
video possible. It is a powerful
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recommend. And if you could please click
on my link below, which is in the video
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watch the short video demonstration of
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lead to future bonus videos sponsored by
Investing Pro, which again is a great
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if you want to sign up because you want
to increase your confidence when
investing in mining stocks or take a
bite off of the oil stocks, please
consider signing up now and take
advantage of the 60% off deal plus the
extra 15% off you get when you use my
link. And as we wrap up this video, I
want to thank everybody for making it to
the end of this video. Please remember
to leave me some feedback in the
comments section below to let me know
what you think of these midweek videos
and if you'd like to see more of them.
Also, if you enjoyed it, leave a like as
that helps this content reach more
people who may need to hear this
message. And before I sign off, I just
want to wish all of my American viewers
a very happy Thanksgiving. Enjoy the
long weekend with your families. And as
I say at the end of all of my videos,
please remember to take care of
yourselves and take care of each other.
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