Physical Metals Experiencing Good Physical Demand

The Market Gage - Dillon Gage's Precious Metals Newsletter

Jump in, the water’s fine.

Good physical demand in the Precious Metals arena. Here are some interesting facts from the United States Mint:

  • Silver eagles demand is up 30 percent from the same time last year.
  • Gold eagle demand up 94 percent from the same time last year.
  • Gold buffalos demand is up 19 percent from the same time last year.

Investors have been building up their silver ETF holdings, which have climbed to a year high today of 19,824 tons. The all-time high is 20,073 tons. 19,824 tons = 634,368,000 ounces held.

Some financial advisors report that retail investors are interested in diversifying their portfolios and in turn are buying physical silver. A few financial advisors I spoke with said that investors think that silver is a better investment than gold in the long run, as they say silver has the ability to triple in value as for gold it would take an economic disaster for the yellow metal to do the same.

Did you think I was going to end the article without mentioning “THE FED.” The FED has repeatedly said that it will look at performance across the global economy before making a decision to raise rates. Soft U. S. housing data this week adds to signs of weak first- quarter GDP growth.

The European Central bank left interest rates unchanged yesterday. ECB President Mario Draghi said, “Low interest rates are a symptom of low growth and low inflation. If we want to return to higher interest rates we need to return to higher growth and higher inflation. I recognize that returning higher rates to savers will be difficult.”

So with Europe and the United States struggling to grow their economies how could anyone justify raising interest
rates anytime soon? The next FED s policy meeting is set for April 26-27. Market-based measures of expectations for FED policy have priced out a rate hike for the first half of the year. My take is I don’t see any chance of strong data emerging that will give the FED any ammunition to raise rates ANYTIME this year.

Have a wonderful Friday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.