Many countries around the world like China are preparing for a new world monetary system. Precious metals futures markets have a lot of paper manipulation occurring. Both China and the United States have a vested interest in low gold prices. The Chinese like low prices because they are accumulating and the U.S. Government prefers it because it makes the dollar look acceptable.
At some point, gold will be revalued, so it’s a good idea to have some of your investments in gold equities as historically they do very well during a monetary reset. He feels that gold could quickly move north of 2000 dollars towards 5000. We could expect something like the 1970-1975 where the gold price jumped, and we saw a similar price move in the early 2000’s.
Two parts of the mining cycle are of particular interest to Willem. The first is when an initial discovery is made by a small exploration company. Then there is also the development stage company when it begins production and gets cash-flow. His fund likes to find companies that are likely to be acquired by major companies.
While they have around 100 positions in their fund, they only have 40 or 50 companies where they put serious money. He says, “You need to spread your risk.” They expect shortages to develop in silver, palladium, and zinc over the next few years. He discusses some of their various holdings in energy and mining companies.
The SPDR Gold Trust ETF (GLD) rose $0.48 (+0.38%) in premarket trading Monday. Year-to-date, GLD has gained 1.73%, versus a -1.39% rise in the benchmark S&P 500 index during the same period.
This article is brought to you courtesy of Palisade Research.