At the recent Mines and Money Conference, Kitco interviewed Rick Rule, asking about commodities, stocks, and the most likely catalyst to drive gold prices higher.
What a year so far, and in the words of Warren Buffett – “Be brave when others are afraid, and afraid when others are brave.” With gold juniors up 150% in many instances, how brave should investors be?
According to Rick, in 2017, bullion may provide investors with the most comfort. What is likely to drive gold prices higher is not necessarily global economic growth (or lack thereof), the political sideshow that is the election, or debt fears. The catalyst for bullion going higher is zero and negative interest rates.
Beyond bullion, where do gold stocks currently stand? “My suspicion is gold stocks, at least juniors, have run a bit too fast.” A consolidation phase is natural and normal in a bull market. It’s not a head fake, it’s just gone too far too fast. Performance has been astounding, and following the initial success of the sector, the junior industry has drawn in many generalist investors looking to ride the wave. “We’re competing with generalist and investment banks that are much more generous and less price-sensitive than we are.”
To hear Rick’s thoughts on lithium, platinum and palladium, the central bank’s role, and the election’s likely impact on precious metal prices, please watch the full seven-minute interview above.
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