Happy New Year, everyone! We are off to a great start so far in 2022, with good things up ahead this year for precious metals. So far in this first week of the year, we have gold up 1.6% to $1,833, silver up 1.9% to $23.30, platinum up 2.1% to $998, and palladium down 2.7% to $1,940.
For the one year, we have gold down 6%, silver down 15.5%, platinum down 10.6%, and palladium down 21.7%. But these annual numbers act like a coiled spring for the metals as we advance - especially for gold, silver, and platinum. While we may see some gains for palladium, I continue to believe there is more risk than reward there, with conditions favoring silver, gold, and platinum (in that order) going forward.
Investment manager Jeffrey Gundlach, known in the investment community as the “Bond King,” believes the yield curve on US Treasury Securities indicates a recession might be up ahead. As discussed earlier, a recession is half of the ingredients necessary for “stagflation.” The other half is “inflation,” which the authorities have acknowledged will be longer-lasting and certainly not “transitory” as first believed.
Gold and silver traditionally thrive during and after stagflation.