gold news

 thank you I'm Charlotte McLeod with the investing News Network and here today with me is Chris blasey president of Neptune Global thank you so much for joining me online once again it's great to have you back thank you Charlotte it's great to be with you again really good to be speaking with you and where we're going to start today is with physical gold demand I was really interested to speak to you because we've had gold at or near all-time highs this year depending on who you ask and I'm

curious to know what you've seen at Neptune Global in terms of demand so wondering if it's been higher at those high prices or lower or if there have been any surprises that you would highlight sure so we're going to stick to gold and we can maybe look at Silver later because it's a little bit different but I would say that the most significant change I've seen and I've been doing this in 21 years is that January February started off a little on the slow side then comes March

and you know here in the United States we had this banking crisis the failure of Silicon Valley Bank um Signature Bank up in New York and then most recently First Republic and what we've seen is um a a large influx of what we call High net worth and ultra high net worth investors so the activity was actually with the with the large investors and what they were telling us what we got is you know they could move money around and spread it between Banks because everyone's worried about insurance

coverage but a lot of them came to the conclusion that they wanted to reduce these large cash positions they had and now they they were resigned that it's time to get in the metals market so quite common with a lot of high net worth they'll go into gold so my experience again I'll recap it large investors coming in mostly because of the banking crisis here in the U.S um the smaller investor would be more on the silver side so um that's you know that's what I've seen okay that that is really interesting and

is there anything more you mentioned maybe we talk a little bit more about silver any other trends that you'd highlight in silver other than the smaller investors coming into that space a little bit more sure so and it's not just small I mean we have some very large investors taking positions or at least you know splitting between gold and silver but silver a lot of activity in March and April um premiums that crept up I think people saw that things have been backing off right now you know silver was moving

nicely into the mid upper 20s now last week we had kind of a difficult week with silver prices back down and that's kind of tempered enthusiasm so um net net silver um overall has probably been the most active metal this year and just in the last week or two things have backed off a little bit but um still very strong a lot of demand and obviously people are looking for that extra upside over the next couple years on a percentage basis that they can possibly and probably achieve with sober versus gold

I would also be interested interested to know are there any particular products that you're seeing demand for when it comes to either gold or silver excellent question so with the silver demand we'll call it the the smaller to mid-sized investors tend to be still coins heavy in coins even though the premiums are especially High especially U.S Eagles we do see a lot of 100 ounce bars and 10 ounce bars the high net worth clients tend to use our volt accounts which are basically all back with gold kilo bars and thousand ounce

silver bars so removed because of the ultra high net worth people coming in we're removing a lot of large bars but demand for silver coins even rounds has been very strong with the smaller to mid-size investors yeah and that seems to to make sense with what those different groups might want to have so I had gone back to some of our previous interviews I think the last one was all the way back in 2021 and one of the themes that we talked about was the idea of getting outside the system with precious metals and I

would think that with the banking situation that you mentioned is going on in the U.S that we've all been hearing about that we would see people being driven more toward that are you seeing that is that something that you're seeing come up among your your customers yeah I think um well we obviously who are our clients at store we are using non-bank depositories we would never store you know or you know in a bullion bags depository so you know that's an important um disconnect right from being outside of

the traditional system but I think you know I think you know the main thing that's happening is and if you don't mind let's I just want to step back and look at a little bit of the history of gold so I've been doing this 21 years and you know there's been expectations through the years that gold would have hit three thousand and five thousand you know several years ago and some people will take the position that gold hasn't done what it should have done right now it's not hasn't achieved its high and

and here's my uh analysis of this gold actually has been doing well I think some people Miss because I've heard this a certain piece of news comes out and gold doesn't immediately react the way the the a lot of folks expect it to so they get dispirited and that's because there is no doubt there is price interference in the gold market we know that the gold price is manipulated through the Futures uh market and it's done at the specific times it's not random in order to temper

enthusiasm and help you know people feel like uh gold is not doing what it's supposed to but I just have to show a chart because having been in this and I started this company in the beginning of the of the new millennium with the conviction that gold was going to going to go on a long-term secular Bull Run so for the folks that say oh gold hasn't been doing what it should do I agree it's going to be much higher and there's a reason it hasn't gone there yet and we'll talk about that in a

second but if you step back gold even though it can be hit and manipulated on a short to sometimes intermediate basis on the longer term when you look back it is actually doing quite well and here is a perfect example a lot of people look at the stock market as the ultimate investment and if you look at this chart going back to 2000 as I just indicated I came in in 2000 the company was fully operational by 2002 but if you look at gold versus the stock market in the U.S in this case it's the

Dow but the s p is really no different than the Dow sparse's performance gold has completely crushed the stock market now you would never get that news or information from any mainstream source and even people who've been in the precious metals Market I don't even think are aware of how much better now granted if they bought in you know the peak in 2010-11 it came down spent a couple years on that retracement but it's still up from then so the point is despite a lot of short-term price

interference that is really a head fake gold has been completely outperforming compared to the stock market we're here in most in most investors perception that's the ultimate uh Benchmark of uh of performance and as I said gold is in a long-term secular bull market my conviction was in the beginning of the Millennium that was the case this is a picture secular bull markets have three legs leg one was basically that 2001 to 2011. and then there's a a pullback of 50 percent of the gain which is leg two

that's exactly what happened and gold bottomed in December of 2015 and we are now in the third leg and looking at this someone may say well you know it's all over no third legs and and parabolic blow-walls so as long as this keeps playing out which if you look at this it's actually doing a textbook um pattern for a secular bull market that gold should be substantially higher in the next few years and I think with what's going on geopolitically and macroeconomically um that's going to happen so um you know

I just need to share that because there is so much I think um uh people being let down or feel like they've been let down by gold it's doing what it's supposed to do silver lags gold so it's it hasn't had quite as a as bullish we'll say a run yet but it's just lagging behind and it will do the same thing so now to um why you know why gold is moving I think you had a couple questions in that area yeah that's right so I think that's really important context for us to start

with and now we can go back and maybe look at some of the drivers of gold that we're seeing going on this year just to finish up with the banking crisis I think a lot of people may feel you know we had these Bank collapses are there going to be more this is a question that people are wondering what is your sense do you think we've seen the end of it or is there more in store I think there's more in store there's also uh people with a a more pessimistic view that some of it is actually being allowed to

happen that this is a way to kind of shrink our banking system and get rid of a lot of the small to mid-sized Banks I mean if you look what happened with First Republic you know that was a sweetheart deal for JP Morgan basically they got all the deposits and got none of the problems and the liabilities so you know I don't think that um uh Silicon Valley signature and First Republic Silicon Valley is a little bit different but you take First Republic especially that they were that much of an anomaly that after them there's going

to be no more problems I think there will be and I think people like constantly looking for places to ship their cash because everyone's focused on the insurance aspect of it so that should keep demand in our Market from a domestic issue um strong okay yes definitely hearing that this is not the end from a lot of people so I think there is more to be watching for there the other thing that we have in the mix of course is the Federal Reserve and their fight against inflation and what's going on with interest rates so

we have quickly approaching the meeting in June I'm curious what you think we may see then because I it seems a little bit divided right now on what may actually happen so what are your thoughts or so what I think is people there's a lot of wishful thinking um you know if you listen to a lot of analysts who are saying the FED has to capitulate they have to Pivot they've been saying that for six months right report three four months and they can't accept that maybe this time the fed's

going to be a little more hawkish a little bit longer um I think they are right and but you know the in the optimism is always like they're going to pitch away they're going to flood the market with money qe's coming back I think it's going to be like I said they're going to stay hulkish for longer and they're bringing problems into the economy you know the economy is slowing down rapidly real estate especially commercial real estate is getting hit hard which again that's

going to be a driver for or problems with the banks because small to mid-sized banks are the Lion's Share of lending in the mortgage market so I think they're they're inflicting pain and one of the reasons they're doing it is they feel that needs to be done to squelch inflation so even if inflation seems to maybe flatten a little bit or even come down a little that's not going to be enough in the short term for the FED to capitulate so I think either they raise a quarter point or they just stand

packed in June and say they're going to remain you know and they're going to give indications that they're going to remain at least hawkish for a longer period of time right and the FED has warned us that we might see a mild recession as we head into the end of the year wondering your thoughts upon that because we've also had people who tell us we are already in a recession or it's coming later or sooner what are your views there where do you stand sure so you know the actual demarcation

point for recessions are a little bit subjective I would say you know and it doesn't affect old geographies equally right so certain parts of the country are going to hurt more than others um that being the case I believe there's regions in the country where it is already um playing out so um you know especially in things like the real estate market um the recession has started and it's going to intensify um and there's other things besides the feds raising at the interest rate um the change in the whole work

environment here in the United States with its effect on the commercial real estate market I mean the commercial real estate market is so significant um you can't have a large downturn in it you can't have the losses that are probably coming down the pike in major metropolitan areas like New York San Francisco Chicago you know Los Angeles without it having a you know a significant impact so no I think the recession is already started um and I think it'll just be obvious you know to everyone or five months from now

okay good to have that context as well and just to throw one more element into the mix we we should touch on what's happening with the debt ceiling I believe as we speak right now they're having a meeting to see about this proposed deal so we don't know exactly what the future may hold there but I'm curious to know you know assuming that they do reach a deal on that which is usually what ends up happening here there are going to be implications beyond that no matter what's decided so

how will that affect the markets and and perhaps precious none of those prices as well so I'm going to give you an approach um where I'm going to be a little bit sarcastic in the sense that it's a to me it's just a clown show they're always going to raise it to me it's a distraction um it's a distraction from the real threats to the dollar um and I'm going to back up a little bit so when we talked about where we are now from the last 20 years that gold has really done well but it

hasn't done what people expected and where I think it will be too I think it's 3 500 5 000 several years down the road um is is definitely um in the works and that is the argument from the bearish side about gold is well U.S being the hegemon they are and the dollar being the reserve asset of the world and the dollar basically being the primary currency for all International transactions was always going to keep it relatively strong which of course conversely is bad for gold and the other side would say well

eventually the dollar will lose its Supremacy and people will say well yes but that's not even in our lifetimes or 50 years from now so basically we didn't have to be concerned well right now in real time there is a effort going on which is got teeth and got traction just deodolarize and for something like detolorization what's happened in the last year is very significant I mean the you the Chinese Yuan went from a year and a half ago being one percent of global transactions to now seven that is significant so the

thing that is going to be that one excuse or and doesn't mean it's an excuse that wasn't founded in fact that the dollar was you know the reserve currency everyone needs it to transact business so a strong dollar will never let gold really appreciate to where a lot of gold bulls fail it should be at that is now being wiped away and it's not going to change the move away that you know because of what I would think is an overplaying of sanctions and weaponization of the dollar and Swift

it's got everybody afraid and now they're all courageous and they're all looking for ways and the dollar doesn't have to disappear and it's not going to disappear but you can't be as strong as you are going from you know a 75 percent share of global trade if you get knocked down to 45. you're not the same right so that weakening the that environment which is playing out right now will be dollar I mean gold bullish right I wonder if we can talk a little bit more about empty dollarization

because you're seeing a lot of things that I think will be helpful for people and understanding how this works because yeah I think we have heard before well that will never happen it's too difficult it's too much but it sounds like you're kind of saying yeah it will happen but it doesn't have to mean the deck of the dollar right those are headlines that we see so maybe yes okay so maybe a little bit more on that exactly sure people get extreme they're like they think has to be either the

dollar is the reserve currency and it dominates all transactions or it ceased to exist well that's not the case and this is where people make their mistake because and they have a normalcy bias that what was what was fact or less you know say post-world War II is therefore goes on in perpetuity and they just refuse right because most people look in the rear view mirror most investors make poor decisions because they they don't really look forward they look in the rear view mirror and there's that

normalcy bias that things will never change despite the fact that if they're honest and they look it is changing rapidly so the dollar is just diminishing in its uh dominance and that's going to be good for gold it's going to mean inflation for us it's going to be problematic it's going to be painful um but as I said that train is out of the station that Genie is out of the bottle it is not going back the countries which are significant which is Promised predominantly like China Russia

India now we look at Saudi Arabia we're looking at Brazil and all these people looking to find ways to transact bilaterally in their local currencies on that's all chipping away and that's not going to stop so I think investors um it's not going to take 10 years like I said the statistic just on the growth in the in Yuan transactions you know three years from now I think the dollar it's uh its percentage of global transactions will be significantly lower and it's going to be lower enough to

significantly boost the price of gold but it's not going away that you know it doesn't need to implode it doesn't need to become like Zimbabwe which it won't be but it's just going to have to compete and it's going to have to share it will be sharing with in a much more significant way with other currencies okay I think that makes a lot of sense that should be helpful for people and how they look at this you're you're really touching on a lot of themes that I've been hearing about quite frequently

lately which is this idea that you know things have changed the things that you knew before might not necessarily be true anymore and in addition to that there's so much noise out there that you need to break through in order to understand what's going on so this is kind of a broad question but any other tips or advice for investors on how they can organize their mindset in this new environment sure so you know some of it sounds unfortunately it's it's not like just uh you know as people like to say rainbows

and unicorns it's just a reality right uh I think one of the other challenges uh for the economy at least here in the U.S which is going to be problematic for U.S Investments and the dollar and good for gold is um people I think gold is very macro right it trades on macro and geopolitical things there is no doubt we're in changes right we hear what used to be said that someday we may move from a unipolar to multi-polar world that is happening right now um and it's happening at a quick Pace

that is a classic example I mean when you're passing the Baton from what one order to the next that is always a time of tremendous disruption and change right and that's when goal thrives gold thrives in chaos right because it is these it is the historic store well that is outside of the system is is real money right so when these when these wars go on between the currencies and the banks of the world um gold stands uniquely and investors you know I mean some people don't want to hear it like you can't be a

successful investor if you only want to pursue and invest in things that you know the story is happy and you know you got to be more pragmatic right it is what it is right we're not going to disappear right but we're going into much more uh challenging times um you know we we're a very device uh divided country that is never a good environment um for an economy if people think economy can function outside of you know of other issues cultural and you know um domestic issues when there's lots of

turmoil and lots of division that never uh is a ideal environment for investing so the point is we're in a much more challenging investment environment I think people need to look much more globally you can't just be isolated and think that we live in a bubble that is not affected by the upside world that's what it was or at least appeared to be for the last post you know years after post-world War II but when you're moving from unipolar to multipolar you are now low you are no longer isolated the way

you were before from what's happening in the rest of the world so being that this big change is going on you know and if you just look at what countries like China India Russia turkey are doing and a host of others they have been stockpiling gold at an accelerating rate and you know there's the old saying don't fight the FED right because the fed well everyone else has their own version of the FED right you know it's just their central bank so I would say if you believe in that Axiom apply it

meeting don't fight them if they're all buying gold they have a much better Insider look of what's going on in the world and if they feel that they need to fortify and build their gold reserves I think individuals need to do the same okay I think that also does make a lot of sense and one thing I want to touch on just briefly is gold and silver price potential under these circumstances I think you touched briefly on where gold could go in the coming years to that 3500 or maybe even 5 000 level any other

thoughts that you would add there on price levels sure so I think gold um I think hopefully because you know we're in the business I hope it takes a little bit longer right um one thing I'll always say people will say oh you know I love to see gold at 5000. um yes but maybe we should do that over the next 10 years um because too quick a move there would mean you know there has to be some serious very disruptive things and even if you're an owner of gold I don't think you really want to see that happening

quickly I'd like to see gold you know more like what it was in 2002 through 2010 where it had a multi-year where basically was going up at a at a reasonable clip each year because it foresult was very forward-looking understanding that here in the U.S that whole housing economy was built on fraud um but it's more likely that it's going to accelerate in the next year or two because again the changes that I talked about earlier are happening at a rate and a pace that are even shocking a lot

of mainstream people so you know as I said I think you need to be positioned the other thing we don't talk about is when there's ever if there's when there is real serious demand for gold with a wider group of people supplying will be an issue because it's always tight there's never that much yes there's enough to meet demand but it's not like if if the if the amount of investors just doubled which of course the amount of people in gold is such a small tiny fraction um doubling that is not much the markets

couldn't handle it yeah you don't yeah so and and the same goes with silver probably even um even even more so yeah you don't want to be buying when everyone else is buying of course and just to briefly touch on Platinum and Palladium as well because I know that these are also metals that you look at you have the PMC ounce that combines the precious metals so platinum and Palladium these are not markets that I follow very closely but I do know we had the world Platinum investment Council

coming out saying 2023 was see a big deficit for platinum any points that you think investors should know about those two more minor precious metals sure yeah they're obviously they come they're trade completely different these are pure Industrial Metals um you know gold being money silver that quasi money and Industrial uh obviously one interesting aspect is there really have um only a handful of countries and really predominantly it only comes out of South Africa and Russia so that right

there right they're both both you know South Africa is part of the bricks um you know they're moving away that could be very problematic in the years ahead on a Supply issue so I think you know their Platinum has been doing a little bit better Palladium has come down from where it was a couple years ago but it's kind of and it moves in in a wide you know a wide berth but um it's been kind of steady in the 1400 to 1500 range um the one thing about Palladium and we deal in a lot of it rpmc outs which you

know the precious metals composite you know incorporates within it platinum and Palladium also uh Palladium is very tough to get um Palladium in investable form is in real short supply a lot of dealers don't even have it available so um we we buy it whenever we can and we you know we hedge it so we have it available for our clients um and I think that's probably only is going to get even uh more difficult to Source um based on if you see the way again this world is moving if these sanctions

keep getting more and more onerous because the two countries that basically control that market are on the other side of uh you know they're part of the other economy that's battling with the West okay well thank you for sharing about those two metals this has been really great I'm wondering just before we wrap up if there are any other points that you would share with investors heading into I guess almost the second half of 2023 sure so I think um I think inflation is uh not going to go

away right we touched on this but these are the important points I think it would I would not be counting on a bed pivot and go and then going back to a dovish position I think you can sit and you can make mistakes I think the FED is not behaving the way they did post 2008 those policies are now gone they've got they have a different objective right now and I think that needs to be accepted and individuals need to invest accordingly and I think it will become for the remainder of the year it'll become more apparent that

we're moving into a recession or stagflation so um my point is invest accordingly um I think it's going to be very interesting for the stock market I know the New Meme now is um is artificial intelligence and that's that's a meme now every tech company is claiming that you know they're part of the artificial intelligence uh but what's going to be interesting I'm looking at is you know money market funds are now yielding you know close to five percent um do they go higher right uh we'll see

because if the fed's actions Drive the money market rate higher it'll be like the 1970s you know the stock market in the US in the 1970s was had a horrible decade because people were getting eight and nine percent in money markets and why would you why would you go into something that basically guaranteed of all government paper and get eight nine percent versus going in the stock market and what Chase something that's very volatile or what maybe 10 percent in the hopes of doing Ted so you know I think

that's going to become more of an issue and if you look back at the 70s money markets safe eight nine percent yields and gold so I think you know again the wind is at our back and I would encourage investors to if they haven't gotten into Metals Market do the research and um at least start to build a position because any Diversified portfolio should always have some precious metals in it all right I think that's a perfect note for us to end on this is really great thank you for sitting down to talk about

what's going on with precious metals thank you Charlotte it's been great to be with you again of course and once again I'm Charlotte McLeod with the investing East Network and this is Chris blasey with Neptune global [Music] thank you