Melman on Gold & Silver
The Federal Reserve just reported that inflation exceeded their 2% target for the first time in five years and the University of Michigan reported their inflationary expectations have now risen to 2.7%.
It’s been no secret that the prices of gold and silver have been moving upward at a fast clip in recent months. Gold has soared 27 percent so far this year. There has not been a significant drop-off in production, so it’s been evident that an increase in demand has been a part of the force driving the price upward.
A matter of some serious concern has developed in the relationship between the prices for gold and silver and the performance of mining share averages.
It should come as no surprise that gold and silver acted similarly, rising sharply during the early hours of the crisis and retreating as tensions abated.
To say that the international environmental community took exception to President Trump’s decision to remove America from the 2016 Paris Accord would be an understatement of enormous proportions.
...the much more important question is this: does this short-term strong rally necessarily portent a genuine turnaround from the metals share bear market that has been ongoing since mid-2011? For a possible answer, we turn to the long-term, five-year XAU chart.
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