In times of economic uncertainty, commodities are often viewed as a safer investment alternative to stocks, serving as the foundational materials that drive societal functions. However, a recent report from Goldman Sachs indicates that the current landscape poses significant risks for many popular commodities, with gold emerging as the premier safeguard against value erosion.
Analysts at Goldman Sachs assert, “We strongly believe in the diversifying role of commodities in investment portfolios based on several structural drivers, including commodities’ hedging role against supply disruptions, not an uncommon occurrence in energy, and the potential for sharp rallies in select industrial metals driven by a combination of long supply cycles and structural green metals demand growth associated with energy security and decarbonization investment.”
Despite this belief, the firm has decided to recalibrate its strategies in light of a softening cyclical environment. “However, given the current softening cyclical environment, we opt to tactically close our 2024 Deficits Basket trading recommendation with a potential gain of 8% and focus on our highest conviction views in the current environment, namely higher implied oil volatility, long gold and short long-dated European gas,” the analysts noted.
The surge in gold purchases by central banks has been remarkable, with the Kobeissi Letter reporting, “Global net gold purchases by central banks reached 483 tonnes in the first half of 2024, the most on record.” This figure represents a 5% increase over the previous record of 460 tonnes set in the first half of 2023.
In the second quarter of 2024, central banks acquired 183 tonnes of gold, reflecting a 6% year-over-year increase, although this was 39% lower than the 300 tonnes purchased in the first quarter, as highlighted by the Kobeissi Letter.
Goldman Sachs remains optimistic about gold’s prospects, stating, “Gold stands out as the commodity where we have the highest confidence in near-term upside.” The firm has set a bullish target of $2,700 per ounce for early 2025, driven by three key factors.
First, the analysts believe that “the tripling in central bank purchases since mid-2022 on fears about US financial sanctions and US sovereign debt is structural and will continue, reported or unreported.”
Second, they anticipate that “imminent Fed rate cuts are poised to bring Western capital back into the gold market, a component largely absent of the sharp gold rally observed in the last two years.”
Finally, they emphasize that “gold offers significant hedging value to portfolios against geopolitical shocks including tariffs, Fed subordination risk, and debt fears.”
Their analysis suggests a potential upside of 15% in gold prices should financial sanctions rise similarly to the increases seen since 2021, or if US CDS spreads widen by one basis point. “That said, due to the particularly price-sensitive Chinese market digesting the recent price rally, we have adjusted our $2,700 target to early 2025 vs year-end 2024 previously. However, we believe that that same price sensitivity also insures against hypothetical large price declines, which would likely reinvigorate Chinese buying,” the analysts added.
- Concerned about your life’s savings as the multiple challenges decimate retirement accounts? You’re not alone. Find out how Genesis Precious Metals can help you secure your wealth with a proper self-directed IRA backed by physical precious metals.
The Kobeissi Letter raises an intriguing question: “Why are central banks calling for a ‘soft landing’ while stocking up on gold?”
As Goldman Sachs maintains its bullish outlook for gold into late 2024 and early 2025, the ongoing demand from central banks is expected to further bolster prices. However, the yellow metal must navigate through September, historically a challenging month since 2016.
With governments around the globe continuing to print debt at unprecedented levels, the prospects for gold remain strong. “But with governments worldwide continuing to print debt like there is no tomorrow, there’s a strong chance that the strength shown by gold in the first half of 2024 will continue in the second half and beyond as the primary result of debt printing is currency debasement,” the Kobeissi Letter concludes.
As the economic landscape evolves, gold’s role as a protective asset appears more critical than ever.
It’s becoming increasingly clear that fiat currencies across the globe, including the U.S. Dollar, are under attack. Paper money is losing its value, translating into insane inflation and less value in our life’s savings.
Genesis Gold Group believes physical precious metals are an amazing option for those seeking to move their wealth or retirement to higher ground. Whether Central Bank Digital Currencies replace current fiat currencies or not, precious metals are poised to retain or even increase in value. This is why central banks and mega-asset managers like BlackRock are moving much of their holdings to precious metals.
As a Christian company, Genesis Gold Group has maintained a perfect 5 out of 5 rating with the Better Business Bureau. Their faith-driven values allow them to help Americans protect their life’s savings without the gimmicks used by most precious metals companies. Reach out to them today to see how they can streamline the rollover or transfer of your current and previous retirement accounts.
Angry Leftists Plot to Tank Trump Economy by Not Spending Any Money Once He’s in Office
by The Gateway Pundit
Most people are expecting the economy to improve under Trump and these people don’t want that to happen, or at least don’t want Trump to get any credit for it. They would rather that people remain miserable than see Trump and the country do well. Breitbart News reports: Leftists Pledge…
Ohio Man Faces Prison Term for Laundering More Than $300 Million in Bitcoin
by The Epoch Times
Ohio-based Larry Dean Harmon has been sentenced to three years in prison for operating a cryptocurrency service used by criminals for laundering millions of dollars, according to the U.S. Department of Justice (DOJ). Harmon, 41, ran a Bitcoin mixer called Helix that was “highly sought after by online drug dealers…
Sabotage: Two Undersea Internet Cables Connecting Four NATO Nations Were Severed
by Publius
Many in the international community are claiming sabotage as the only viable explanation for two fiber optic internet cables in the Baltic Sea being severed less than 24-hours apart. Fingers are being pointed at Russia as one of the the cables connected NATO nations Germany and Finland. The latter was…
“Massive Breach”: T-Mobile Network Hacked by Chinese State Sponsored Intelligence
by Tyler Durden, Zero Hedge
(Zero Hedge)—Where’s John Legere in a pink t-shirt when you need him? Among the multiple stories over the last few weeks about Chinese intelligence and hackers either attempting to, or outright gaining access, to U.S. cell phone networks (with reports stating President Trump and his team were targeted), comes news…
Income Needed to Afford a Home Hits Record High in U.S. Cities
by Dallas Express
Owning a single-family home in the U.S. now requires an average annual income of $107,700, nearly double the income needed in 2019, according to a new report by Oxford Economics. This increase is attributed to soaring home prices and nearly doubled mortgage rates over the past five years, the New…
Senators Ask Cyber Review Board to Conduct Investigation on Chinese Hack Group
by The Epoch Times
A bipartisan group of senators has urged a federal review board to immediately begin an investigation into a Chinese hacking group’s attacks against the United States, according to a recent letter sent to Robert Silvers, undersecretary for policy at the Department of Homeland Security (DHS). Led by Sen. Eric Schmitt…
Russian Officials Believe That “NATO Has Gone to War With Russia”
by Michael Snyder
Editor’s Commentary: Before we get into the article and video below by Michael Snyder, I want to make an important note. I do not believe that Russia is in any condition to actually go to war with NATO. I also do not believe that Donald Trump is, in any way,…
‘That’s Not Helpful’: Harris Faulkner Slams Dem Guest After He Claims Americans Don’t Understand How Strong Economy Is
by Daily Caller
Fox News host Harris Faulkner called out a Democratic guest Monday after he claimed American voters didn’t understand that the economy was “strong.” President-elect Donald Trump defeated Vice President Kamala Harris, securing more than the 270 electoral votes necessary to win the presidency in the early morning of Nov. 6…
Global Propagandists Find Out: AP to Slash Staff by 8% as Major News Outlets Stop Buying Its Content
by JD Rucker
Everyone in legacy corporate media is struggling with the possible exception of Fox News. Following Donald Trump’s election victory, the writing on the wall that legacy media has been pretending wasn’t there became too bright to ignore. The people don’t trust the media. It’s not because of the Trump victory….
Trump to Declare a National Emergency to Conduct Mass Deportations
by Tyler Durden, Zero Hedge
(ZeroHedge)—President-elect Donald Trump confirmed Monday that he will declare a national emergency to carry out mass deportations. In response to Judicial Watch president Tom Fitton’s post on Truth Social that Trump was “prepared to declare a national emergency and will use military assets to reverse the Biden invasion through a…
Gov. Youngkin’s Executive Order Seeks to Address Virginia’s Housing Shortage
by Just The News
From now on, economic and housing development will be tied more closely together in Virginia, according to the latest executive order from the governor. Gov. Glenn Youngkin issued and announced Executive Order 42 in Thursday at the annual Virginia Governor’s Housing Conference. The order brings the commonwealth’s economic development and…
“Hopefully No More”: How Trump Appointments Could Sway the Balance of Power in the House
by Owen Klinsky, DCNF
(DCNF)—President-elect Donald Trump’s cabinet picks could temporarily jeopardize the GOP’s slim majority in the House of Representatives. The GOP has held on to control of the House, securing the 218 seats needed for a majority with five races still yet to be called, according to The Associated Press. However, Trump…
Ramaswamy Expects ‘Mass Reductions’ in Federal Government Under Trump
by Daily Wire
There will be “mass reductions” in the federal government under President-elect Donald Trump‘s second administration, Vivek Ramaswamy predicted this weekend. Ramaswamy, whom Trump picked to lead the brand new Department of Government Efficiency (DOGE) along with Elon Musk, spoke to Fox News anchor Maria Bartiromo on “Sunday Morning Futures” about…
Texas Again Breaks Its Own Jobs Records
by Bethany Blankley, The Center Square
(The Center Square)—Texas continues to break jobs records every month and October was no different. Texas again grew jobs at a faster annual rate than the national job growth rate over the year in October. It also set a new record high for the greatest number employed in the civilian…
Congresswoman Nancy Mace to File Resolution Banning New Trans Congressman From Women’s Restrooms
by JD Rucker
Despite all of the amazing victories the GOP had on Election Day in the ongoing battle against wokeness, there was one conspicuous loss. Delaware elected “Sarah” McBride (born “Tim”) as the first trans member of Congress. Congresswoman Nancy Mace is calling on her GOP colleagues to pass a resolution banning…
