GOLDEN NEWS 2021-05-24 #Gold #Crypto #Wealth

GOLDEN NEWS

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We are starting a new week (the twenty-first week of 2021), so it is time for traditional golden news. 

The price of gold rose to its maximum of 1881 UDS per troy ounce on Friday. The price of silver rose to 27,760 USD per troy ounce.

The markets were quite lively. Cryptocurrencies fell sharply (down over 50%). The development confirms that investing in cryptocurrencies is a speculation, and you need to keep an eye on it permanently. According to this definition, it is reasonable (according to investment rules) to hold up to 1% of invested funds in cryptocurrencies; you may consider possibly set the limit higher to the size of inflation. Above these limits is for a professional trader. (In any case, the best place I would recommend for your crypto activities is Binance. Ping me if you want to know why. Here is a 10% discount on fees.)

The statistics from the US economy were certainly not boring and caused considerable excitement in the markets. In particular, the rise in inflation, which exceeded all expectations, when US inflation rose to 4.2% in April and thus reached the highest values since 2008, did not add to the decline in consumer confidence in the US. An interesting figure is that the month-on-month rise in inflation in the US is more than 60%, which indicates an interesting dynamic. Precious metals responded to this information with strong growth, especially gold, and thus reached this year's maximum.

10 reasons to invest in gold today:

1. Protecting against inflation - Gold has historically been an excellent tool for hedging against inflation, as its price tends to rise whenever the cost of living rises.
2. Portfolio diversification - it is always better to invest in more financial instruments. It is recommended to include gold in your investment portfolio, which reacts to the market situation exactly the opposite of gold. So if stocks fall, the demand for gold grows.
3. Gold is available to everyone - there are currently many ways to invest in the rising price of gold. It is possible to buy both physical coins and ingots in the form of a one-off purchase and buy them in the form of a gradual investment.
4. Strategic investment - Gold has been and always will be the rarest precious metal in the world. That is why all the world's central banks hold it, and they use every fluctuation in the price drop to increase their gold reserves.
5. Limited supply - Gold is limited. Mining is now at its peak and is expected to decline gradually. Buying gold today seems like a great way to make money on its sale in the future.
6. Growing demand - The low price of this precious metal raises demand not only from individual investors but also from world central banks.
7. Liquidity - gold is very liquid. Gold can be easily exchanged for money anywhere in the world.
8. Low-interest rates elsewhere - term accounts and most conservative investments have such low interest rates that the appreciation of these investments is much lower than the rise in inflation. Gold responds to any reduction in interest rates with growth due to the growth of the money supply in the economy.
9. Growth response to the weakening US dollar - Although the US dollar is one of the world's most important reserve currencies, commodity prices rise as the dollar depreciates.
10. Stable investment - Gold is probably the most stable investment and commodity in the world. In the event of the collapse of the monetary and banking system, it offers protection against the loss of value of paper assets.

 So betting on gold is the right choice in today's turbulent world.

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Current development of the price of gold and silver:

 Over the past five days, gold and silver performed so that gold and silver strengthened by + 2.6 percent to 1,881 USD, silver by + 0.64 percent to 27,564 USD per troy ounce 

Forecasts and news:

Investment metals and investments:

Overview:

Global government debt is still growing. The debts of emerging economies are reaching absurd levels and have reached new records. Cryptocurrencies fell sharply last week, with Bitcoin dropping to $ 28,000. It certainly does not help the cryptocurrencies that the pull by the regulators against them continues. 

The US Department of State has finally announced that it is taking action against cryptocurrencies and transactions with them. As part of this new procedure, all transactions in this sector over $ 10,000 be reported to the IRS. 

Another blow to cryptocurrencies is the actions of Chinese regulators, who announced that they had issued a warning that financial institutions there should not carry out any cryptocurrency-related operations, including trading or exchanging for normal money. China is another country after Turkey and India, which is de facto moving towards a total ban on cryptocurrencies. This procedure can have a fatal effect on cryptocurrencies. 

At the same time, the negative mood in the cryptocurrency sector was strengthened by Elon Musk's statement at the end of last week when he announced that the carmaker Tesla will not accept Bitcoin when paying for its cars.

• The Fed has asked lenders to share information on measures to mitigate threats to their economic balance sheet. In other words, the Fed does not believe that lenders (banks, mortgage funds, etc.) are ready to face high inflation. The Fed is facing debt problems and is not sure whether the US banking sector will withstand it.
• Unemployment in Germany rose to 6% in April. Due to the interconnectedness of the Czech and Slovak economies with the German economy, delayed effects can be expected in them as well.
• The inflation rate in Germany rose to 2% in April, while consumer price inflation reached 1.7% in March. This follows from preliminary data published by the German statistical office. The expected rise in inflation is thus beginning to materialize.
• The finance ministers of France and Germany support the US proposal to have a minimum corporate tax of 21% in the world. It seems that a unified campaign to increase taxes is starting. If such an increase were to occur, it would certainly not benefit the competitiveness of the EU economy.
• China expects its economy to grow by 9% this year. The problem of Europe's competitiveness shows this in full nudity.
• Janus Henderson (British Global Asset Management Group) notes that government debts worldwide have risen to record levels. Debt service is cheaper today than ever before, thanks to purchases of government bonds by central banks. This procedure masks reality. However, an increase in repayments and a rise in the price of debt can be expected soon. This will be a problem for indebted countries.
• The ECB (European Central Bank) was expected to keep the key interest rate at zero. This continues the exceptionally loose monetary policy to help the eurozone affected by the pandemic. At the same time, in March, the bank decided to significantly increase the pace of further money printing.
• The debt of EU countries is approaching 100% of GDP! In essence, this means that the EU owes as much as it earns over the year. Prosperity certainly looks different. This is another warning signal for future economic developments in the EU.
• Germany's public sector deficit is estimated to more than double this year, rising to approx. 9% of GDP. This is a figure published by the German Ministry of Finance.
• The British authorities are considering introducing a new digital currency, which could be called "Britcoin". This is another step in withdrawing capital from independent investments such as cryptocurrencies. At the same time, it is another step towards perfect control of financial flows. The state would thus have a perfect overview of who buys from whom and what it buys.
• The Italian government has cut its estimate for this year's domestic economic growth to 4.5 percent from the previously expected six percent. It also approved a new package of stimulus measures worth EUR 40 billion. According to the government, the budget deficit will climb to the highest level in 20 years.

Technical and general views:

• The price of gold reached a maximum of USD 1,881 per troy ounce at the end of this week, and due to rising inflation, it seems that it will continue on the path upwards.
• Holding low interest rates and real growth in inflation is a prerequisite for reducing risky investments and further growth in the price of gold.
• The three largest gold mines in Muruntau in Uzbekistan, Carlin in the US state of Nevada, and Olimpiada in Russia account for five percent of world gold mining.
• According to the former chairman of the US State Mint, mints worldwide are running out of physical gold. The price of yellow metal, according to them, will rise significantly in six months.
• Fear of inflation popularizes physical gold. In addition to private investors, central banks also pay for physical gold. According to the World Gold Council, sales of physical gold to private investors increased by 36% to 339.5 tonnes in the first quarter of this year.
• Shares of the US SP 500 index are selling for more than 32 times profits. This surpasses the level of the technological bubble at the turn of the millennium. In the last five months, it has attracted more capital to capital funds than in the last twelve years. This in itself is a signal that stock markets need to be monitored very closely.
• Demand for physical gold from private investors increased by 36% year-on-year to 339.5 tonnes during the first three calendar months.
• Investors and households in China bought the most physical gold, where interest increased by 133% compared to the same period last year.
• According to the World Gold Council, demand for gold coins and ingots increased significantly year on year in the first quarter of this year.
• A significant increase in interest was also recorded in the case of gold jewelry. Trade-in them increased by more than half year-on-year to a total of 477.4 tonnes.
• In addition to private investors, the demand for gold was also significantly increased by central bankers. For example, the Hungarian central bank recently bought 63 tons of gold, tripling its gold reserves.
• General expectations of gold price growth for this year are in the range of 2,000 - 2,500 USD / oz. In the case of silver, in the range of 30 - 35 USD / oz. The onset of the growth phase is then expected during the second quarter of 2021.
• Central banks are among the most important gold holders. A total of 35,219 tons are stored in their safes.
• The People's Bank of China, the state's national central bank, has granted domestic and international commercial banks permission to import large amounts of gold. According to sources from the South China Morning Post familiar with the issue, this could lead to a significant rise in the price of gold.
• According to Goldmoney's chief analyst Alasdair Macleod, the future money will be gold and silver. The author assumes that after the collapse/extinction of Fiat currencies and currencies created in the computer, healthy money, which is gold and silver, will come.
• According to Standard Chartered Bank, gold will rise in price to USD 1,820 per troy ounce. The bank expects an increase to this value in the third quarter, followed by US inflation.
• Hungary has secretly tripled its gold reserves. The MTI news agency published information that the National Bank of Hungary increased its gold reserves from 31.5 tonnes to 94.5 tonnes. The central bank justified the increase in gold reserves by taking into account the long-term goals of the country's national and economic strategy. The Hungarian Central Bank thus has the largest gold reserves in the region.
• According to Investing.com, the most important factor in the development of the price of gold is the ratio of gold to the SaP 500 stock index. Capital is now shifting from bonds to stocks and commodities.
• Record jump in gold imports to India. Gold imports to India rose an incredible 471 percent in March. The Indians bought 160 tons of gold worth $ 8.4 billion in just one month. 321 tons of gold were imported to India during the whole quarter. If this pace continues, the Indians will consume a quarter of the gold that will be mined in the world.

I wish you a positive mind, good health, and a successful week

Don't hesitate to message me or email me at [email protected]

Tomas