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The Visual Capitalist in his excellent graphic representation below of where the Ultra-Wealthy invest their assets, bears inspection.
Primary and secondary residences make up 32%, 18% in equities, 14% in commercial property, 12% in bonds, 6% in private equity/venture capital, 5% commercial property funds, 3% commercial property REITS, 3% investments of passion, 2% Gold, 1% crypto assets, and 5% other assets.
If we look at total PROPERTY investments, it is 32+14+5+3= 54%. Property is a double edged sword. Ideally it should protect one against an inflationary environment. If there were no property taxes this could be true. What happens if property taxes are not paid? Property confiscation!
Does one really own the property if taxes are levied on it making it subject to confiscation? We have no control of the amount of property taxes levied. So what are the limits? A too hot economy is usually the bringer of high interest rates which lead to falling property prices.
The other side of property ownership is in the risk of recession and a contracting economy or deflation. This causes property sales to implode as there are few buyers.
If one is wealthy enough, one can wait for a price and value recovery. If we think of the 1929 depression, stocks and property took until the 50’s to recover to their original prices. Values? Maybe.
Bonds comprise 12% of their portfolio. Right now bonds are under pressure. I do not see the pressure lifting for quite a while.
The other investments are diversification and a relatively small percentage.
Of note is the gold holding of only 2%. Interestingly enough, investment funds hold 1.7% according to Quantpedia.
Only 15% of institutions hold any gold in their portfolios. Of those, their average allocation is an average of 4% of the portfolio. So a quick calculation would work out at approximately 0.6% overall. What would happen to the price if this went to 4% overall?
I worry about the trajectory of the economy and the safety and allocation of assets.
Bitcoin and Gold
Bitcoin is holding the price established last week. It is looking overbought here and is due for a correction. So Bitcoin is holding its stronger relationship to gold as it stands right now.
Gold and Silver Stocks
Gold is still outperforming the gold stocks.
Physical silver is still outperforming the silver stocks.
Gold and Silver
The Gold:Silver ratio is standing at 87.21 ounces of silver to one of gold in the chart below.
This is a crazily out of place ratio. The miners are stating that they are bringing silver out of the ground at a ratio of 7 ounces of silver to one of gold.
How is this possible in a normal market?
We await open free trading precious metals markets, doing the job they are designed to do. That is showing the weakness of the currencies.
Gold to USD chart
Gold is holding up reasonably well against the strong dollar. The dollar according to our system could get stronger, but at present is moving sideways. The signals are looking weaker so we wait and watch.
Look at the Gold and Silver Charts
|Gold Miners bullish percent index||17.86||17.86|
|Dow:Gold Ratio (BahaUS 33,484.00 Gold price, $1,984.00)||16.87||16.70|
|Current USA inflation rate (Dept. of Statistics)||3.7%||3.7%|
Gold’s low of the week was $1,969.00 and the high was $2,007.00, now trading at around $1,983.00.
- The monthly chart for Gold is an out indicator but recovering well.
- The weekly chart is in a buy but looks over bought here and will have resistance up to $2,050.00.
- The daily chart is a hold. It looks a little overbought and rolling over.
The low for Silver this week was $22.53 and the high $23.60, trading around $22.86 at present.
- Silver on the monthly chart indicates out and most indicators are still negative..
- The weekly chart has had us on a rollercoaster and is indicating out. The buy indicators have not triggered yet.
- The daily chart is a hold but is looking toppy. More indicators are looking negative.
Our partner has stock of both gold, silver and Goldbacks in our vaults available in Panama.
Please contact us for more information.
On the Stockcharts.com charts, the blue vertical lines are our proprietary system buy signals and the red vertical lines are system sell signals – for information purposes only
Please contact us to arrange the purchase and storage of your gold and silver requirements in a safe, insured location outside of your jurisdiction.
If you are interested in an overview of Fort Kobbe, you may want to have a look at this video: Mike Brown, Director, Fort Kobbe, International Vaults, A DotCom Magazine Exclusive Interview
This is my interpretation of the market and is not to be taken as financial advice. Before making any buy or sell decisions, I recommend that you consult with your professional financial advisor.