Ignore the Price Drop: Gold and Silver Fundamentals are Strong

Summary

In the latest episode of Common Sense Finance, the host addresses the recent price drops for gold and silver that occurred on Monday. Despite speculation about the reasons behind the drop, the host believes it to be an overreaction and maintains that the fundamentals for both precious metals remain strong. They argue that gold and silver serve as excellent hedges against the current economic issue of massive debt, which is often underreported by mainstream media. The host criticizes the paper market for not accurately reflecting the true value of these metals and calls for a free and fair market where each ounce of gold or silver traded is backed by the actual metal. They also discuss market manipulation techniques such as naked short selling and spoofing, which they believe distort the true supply and demand. The host concludes by expressing optimism for the performance of gold and silver in the coming year, encouraging viewers to consider buying and preparing for potential future gains.

Takeaways

• 📉 The recent price drops for gold and silver are being discussed, with gold dropping to around $1,320 an ounce and silver to about $17.50 an ounce.
• 🤔 The speaker doesn't believe the drop is due to easing geopolitical tensions, as there's still significant tension in the Middle East with a high probability of conflict.
• 📈 A personal opinion is expressed that the market overreacted to the price drops, and the speaker anticipates a price increase in the near future.
• 💼 Fundamentals for gold and silver remain strong, serving as a hedge against the economy's massive debt problem, which is not often covered by mainstream media.
• 👶 The burden of massive debt will likely be felt by future generations, not the current one.
• 🚫 The true value of gold and silver is not expected to be realized until there is significant progress in resolving the debt situation.
• 📊 The speaker criticizes the paper markets for not accurately reflecting the supply and demand for gold and silver, suggesting a need for a free and fair market.
• 🛍️ The physical market for gold and silver, as evidenced by premiums on coins like the American Eagle, shows high demand despite spot price fluctuations.
• 🧐 Market manipulation techniques such as naked short selling and spoofing are mentioned, which artificially drive down prices and are deemed corrupt.
• ⏳ The speaker advises that the physical market, not the paper market, should be setting the price for gold and silver, suggesting a need for dealer competition.
• 💰 Despite the current situation, the speaker still expects gold and silver to have a good year and recommends that it's a good time to buy and prepare.

Q & A

What recent price drops were discussed in the video?

The video discusses the recent price drops for gold and silver that occurred on Monday, with gold falling to around $2,320.80 an ounce and silver dropping to about $27.50 an ounce.

What was the speculation regarding the price drops?

There was speculation as to whether the price drops were a temporary blip or the start of a trend towards lower prices for gold and silver.

What does the speaker think is driving the price drops?

The speaker believes that the price drops are not due to easing geopolitical tensions, but rather an overreaction in the gold and silver markets, which tend to overreact on both uptrends and downtrends.

Why does the speaker think the fundamentals for gold and silver are still strong?

The speaker argues that the fundamentals for gold and silver are strong because they are one of the best hedges against the current economy's biggest problem, which is massive debt.

What is the speaker's opinion on the current debt situation?

The speaker believes that the debt situation is not being adequately addressed by the mainstream media and that it is unacceptable, as future generations will bear the burden of this debt.

How does the speaker view the current market for gold and silver?

The speaker is critical of the current market, stating that it is not free and fair, and that the prices of gold and silver do not accurately reflect supply and demand due to manipulation techniques like naked short selling and spoofing.

What does the speaker suggest about the relationship between the paper market and the physical market for gold and silver?

The speaker suggests that the physical market for gold and silver should be setting the price, not the paper market, and that dealers should be competing with each other to offer better prices.

What historical price points for silver does the speaker mention?

The speaker mentions that in 2022, silver was in the range of $20 to $25 per ounce for most of the year, and that American Eagles were selling for over $40.

What is the speaker's prediction for the year of the video?

The speaker predicts that gold and silver will have a great year, although they do not expect the big breakout that they believe should happen.

What does the speaker recommend for viewers regarding gold and silver?

The speaker recommends that it is still a good time to buy gold and silver and to prepare for the future, despite the recent price drops.

What evidence does the speaker provide to support the discrepancy between spot prices and physical market premiums?

The speaker points out that with a spot price of $27-28, American Eagles can be bought for around $34-$35, which is cheaper than when the spot price was higher, indicating a discrepancy between the physical market demand and the spot price.

Why does the speaker believe that the current generation will not feel the full burden of the debt?

The speaker believes that the current generation will not feel the full burden of the debt because it is being passed on to future generations, such as children and grandchildren.