Precious metals bounced higher after the initial post-election pullback, with a lot of upside potential.
So far, the prices of gold and silver are following the playbook that was predicted by McAlvany’s Golden Rule Radio special Election Market Expectations show broadcast in mid-October.
Let’s take a look at where prices stand:
On Friday, gold was up to $2717.04. Week over week, the price of gold was up $105, a nice rebound after the prior week’s dip.
See the current gold price
On Friday, the price of silver rose to $31.42. That’s up 3.9% or $1.18 from a week earlier.
See the current silver price
Crypto’s Meteoric Rise
There’s no shortage of optimism for Bitcoin and other crypto currencies. During his bid for president, Donald Trump claimed he would make the US the “world capital for crypto and bitcoin.” Investors are betting that Trump’s support will lead to fewer restrictions on cryptocurrencies.
Bitcoin reached an all-time high of $99,987 last week, and has had gains of 132% for 2024. Since the election, other coins have also rocketed higher — with Ethereum up 39%, Ripple gaining 215%, Solana up 54%, Cardano rocketing up 240% and Dogecoin rising 144%.
Era of Good Feelings
The financial markets reacted with cautious optimism when the October 2024 Consumer Price Index (CPI) and Producer Price Index (PPI) data were released. While core CPI remained above 3%, there were increased expectations for potential Federal Reserve rate cuts.
Markets traded higher due to expectations of better days to come, along with the euphoric momentum driven by the current technology wave.
Just looking at the Russell 2000 these days, 43% of the companies in the small-cap index are losing money. Compare that with the dot-com bubble era of 2000, where about 17% of the small-cap companies in the index weren’t making money. As David McAlvany and Kevin Orrick discussed in Weekly Commentary, it’s easy for investors to ignore the warning signs of unsustainable valuations when they continue to make money.
What’s The Real Inflation Rate?
According to CPI report, the renters and owners’ equivalent rent — which makes up one-third of the index — rose up only 23.6% since January 2021. It also reported that there was a 29% decline in the cost of health insurance over the last two years and a 12% decrease over the last five years.
The Fed gears its plans around a 2% inflation target, and with the help of understated housing statistics and “declining medical costs,” it’s getting closer to target.
But how real are these numbers?
The actual cost of homeownership has doubled since January 2021. That’s because property taxes and homeowners’ insurance aren’t counted in the index — and both have risen substantially for many people around the country.
While the uninsured rate has dropped to historic lows due to policy changes during the pandemic, many Americans remain inadequately insured or face high out-of-pocket costs.
Protect Your Money
While investors may be ignoring fundamentals for now, the party can’t last forever. Fortunately, you can protect your hard-earned money and build your own insurance policy by investing in gold and silver.
With Vaulted, you can put your gold and silver acquisitions on autopilot through VaultPlan. You set the desired amount, date and frequency (up to twice a month), and Vaulted handles the rest. All you need to do is log into your account, set up your plan, and sit back while VaultPlan grows your savings.
