Ronald-Peter Stöeferle: The Perfect Storm for Gold & Mining Stocks
Ronald feels that we are in a perfect storm for gold as his inflation indicator began to rise this January. One should load up on inflation-sensitive currencies, mining equities, physical gold, and the commodity sector in general. The combination of monetary tightening and rising rates is going to lead to recessionary risks and the economic numbers show a dramatic cooling.
Trump’s fiscal stimulus last year at the top of the cycle was a Keynesian’s wet-dream to extend the cycle. When the liquidity gets taken away the financial markets get nervous as we have seen. Gold and the dollar are counting on major central banks becoming more dovish.
His long term target has always been $2300 for gold and even the big banks have higher long-term targets. We are still far away from main street being bullish on gold. Central bank buying has been the largest in fifty years.
Many investors remain indecisive and are waiting for a bigger rally. $1400 – $1500 this year is possible once we overcome resistance. We are now in the second stage of the bull rally. The party will really get going in the coming months and years.
He discusses the last bull market and how it compares to the one that is forming now. Takeovers are a sign that we are at the bottom of the market. Mining companies have cleaned up their balance sheets so the leverage potential is quite high.
Time Stamp References:
1:40 – Perfect storm for gold is brewing.
3:00 – Recessionary risks are increasing.
3:40 – Federal Reserve monetary U-Turn.
5:30 – His long-term targets for gold.
6:50 – Central banks are buying.
7:30 – Institutional investors remain on the sidelines.
8:45 – Entering the second stage of the bull market.
10:30 – Recent gold and mining equities performance.
13:20 – Dedollarization is increasingly an important topic.
14:20 – US Dollar is rolling over.
Talking Points From This Week’s Episode
• A monetary U-turn is coming.
• Recessionary risks are increasing.
• Takeovers are an indication of a market bottom.
• Gold is likely to reach $1400-$1500 this year.
• Dollar at risk of rolling over.
Ronald-Peter Stöeferle, is a Chartered Market Technician and a Certified Financial Technician. During his studies in business administration and finance at the Vienna University of Economics and the University of Illinois at Urbana-Champaign, he worked for Raiffeisen Zentralbank in the field of Fixed Income/Credit Investments. After graduating from university, Stoeferle joined Vienna based Erste Group Bank, covering International Equities, especially Asia. In 2006 he began writing reports on gold and gained media attention when he expected the price of gold to rise to USD 2,300/ounce when the current price was only at USD 500. His six benchmark reports called “In Gold we Trust” drew international coverage on CNBC, Bloomberg, the Wall Street Journal, Economist and the Financial Times.
In 2013 he became managing director and partner of Incrementum AG, based in the Principality of Liechtenstein. The company focuses on asset management and wealth management and is one hundred percent owned by its partners. He continues to write the annual “In Gold we Trust” as a senior advisor to Erste Group.