What Makes Gold One of the Most Reliable Trades on the Planet
Andy Snyder|March 10, 2020
[Note: Yesterday was a historic day on Wall Street. It will go down as one of the most stunning days of our lifetimes. Stocks plunged. Oil crashed. And interest rates just went extinct across the globe. We’ve seen something like this just a few times in history.
But, alas, history is our favorite teacher.
Nobody knew the sweeping danger and fear tucked inside the deadly virus that’s sweeping the planet. Nobody could have predicted any of this three months ago.
But that doesn’t mean you could not have been and should not be prepared for what’s happening… or what’s about to happen.
For more than two years, we’ve been shouting about the death of interest rates. Since the beginning of this little passion project, we’ve been telling folks to think for themselves and not trust any government to protect them from calamity. And we’ve been begging folks to think differently about how to protect their wealth, their health and, frankly, their lives.
That’s why we’re sending you something a bit different this morning.
What follows is part of an essay that I sent Manward Letter subscribers way back in February of 2018. We don’t normally give away our subscriber-only content… but we all agree things aren’t normal right now.
This piece used history… experience… and old-fashioned common sense to tell us that, despite its incredible popularity, the bitcoin run was over and gold was about to go on a major run higher. In the days since, prices of the oldest form of currency have soared and bitcoin hardly gets any attention. But it’s now clear that we’ve only seen the start of gold’s run higher. The shiny metal may be about to go on the surge of our lifetimes. Please pay attention…]
Wall Street has entered its ninth straight year of a bull market.
Thanks to unprecedented stimulus, government manipulation and a hefty dose of good fortune, American stocks have treated investors quite well for more than a decade.
The benchmark S&P 500 has surged an incredible 230% since February 2009.
Toss in dividends, and the figure soars to nearly 300%.
During this high-flying bull market, making money in stocks has been easy.
Nearly everything has surged in price… if not value.
But savvy investors – those who have been around the markets for more than a decade – know that good times don’t last forever.
Eventually, the easy money runs out.
Historically, our bull dies with one final, jaw-dropping charge. He sucks every last penny out of investors’ pockets… and then drops over dead.
It doesn’t take long for the bears to slash open his stomach and devour his cash-stuffed guts.
It takes a lifetime to get rich… and just a few months to lose it all.
Here It Comes
By our measure, the recent crypto craze represents the beginning of the end.
It’s the everybody-in bull charge that marks the end of the easy money.
We offer two crazy stocks as proof of what’s happening… and what’s about to come.
On December 21, Long Island Iced Tea Corp. announced it planned to change its name to Long Blockchain Corp.
Now, the company had no immediate plans to stop making iced tea. And it had no idea just how it would make money via the blockchain.
But investors didn’t care.
The stock surged on the news… up an incredible 200% overnight.
Several other companies made similar moves. One soared when it announced it was ditching the high-flying world of biotech for blockchain. Another tobacco company saw its shares surge when it announced it, too, was getting into blockchain.
It’s all quite similar to the internet craze (and crash) of the 1990s… when companies added “.com” to their names and stood back as their stocks soared higher.
But one company in particular caught our eye last month. It proves the power of what we see happening.
Shares of Natural Resource Holdings – an Israel-based investor in traditional metals mines – first started to surge on the Tel Aviv market when it announced it would “explore” opportunities in the realm of cryptocurrencies.
After barely moving for more than seven years, shares surged 30% on October 19.
Then the company announced a name change… to Blockchain Mining Ltd. Shares went up another 40%.
Not resting on a mere double, the company announced on November 19 that it was in contact with two Canadian banks about blockchain. Shares surged again.
But then the big news… the company was buying a 75% stake in a company known as Bitfarms.
In all, investors saw their stock surge more than 2,000% from mid-October… all thanks to the company’s transition from traditional mining to digital mining.
What’s crazy, though, is this sort of thing is happening all over the hard-metals mining sector.
The Crypto Shift
We recently talked with one expert mining investor who told us just how devastating the trend has been for metals miners. The speculative capital that once funded their operations is now flowing straight toward digital currencies and the companies that are mining them.
It’s created an incredible buying opportunity… in gold.
As you know, buying dot-coms in 1999 turned out to be quite the losing venture over the next decade. Instead, the winners during the decade that followed were very different from the stocks the masses were pouring into.
If you wanted to make money… you needed to stray from the herd and buy anything but high-tech stocks.
Companies like Medifast, Green Mountain Coffee Roasters, Monster Beverage Corp. (then Hansen Natural), Southwestern Energy, Clean Harbors and XTO Energy all earned their investors gains of 1,500% or more in the decade following the peak of the dot-com boom.
Clearly straying from the herd as it blindly hiked to the peak of record-breaking valuations paid off.
Instead of loading up on expensive dot-coms, the folks who bought much more predictable, understandable businesses spent the next decade getting rich.
We have the chance to do exactly the same thing today.
But this time the rationale is doubly strong.
You may recall that as the dot-com bubble burst, gold entered one of its strongest periods in history. The shiny metal quietly surged from nearly $300 per ounce in late 1999 to nearly $2,000 per ounce a decade later.
So the very first reason we should be exploring an investment in gold this close to the tail end of the great bull market is quite simple… Gold is a proven hedge against falling stock prices.
It’s the classic case for gold.
As investors flee their speculative assets, they run straight to gold. It’s one of the most reliable trades on the planet.
[Note: The piece went on to debut a blue chip gold stock that has since gone on to double in value… as the price of gold entered a fierce run higher. The rationale behind gold is even stronger today. Buy some.]
Andy Snyder is the founder of Manward Press, the nation’s premier source of unfiltered, unorthodox views on money and what it means for a free society. An American author, investor and serial entrepreneur, Andy cut his teeth at an esteemed financial firm with nearly $100 billion in assets under management. Andy and his ideas have been featured on Fox News, on countless radio stations, and in numerous print and online outlets. He’s been a keynote speaker and panelist at events all over the world, from four-star ballrooms to Senate hearing rooms. Today, Andy’s dissident thoughts on life, liberty and investing can be found in his popular daily newsletter, Manward Financial Digest.