(Kitco News)—The gold market continues to drive toward $3,000 an ounce and it remains the standout asset in a world filled with economic uncertainty and geopolitical turmoil, according to one fund manager.
Although gold is trading at fresh all-time highs above $2,980 per ounce, Ryan McIntyre, Managing Partner at Sprott Inc., told Kitco News that he doesn’t see it as overvalued, as demand for safe-haven assets is surging.
“I would say that equity valuations are the highlight of overvaluation on many different metrics,” he said. “When you look at what is happening in the world and you consider the potential reward versus the potential risks, to me, gold still stands out as the place to be.”
The comments come as spot gold prices trade at $2,972.10 an ounce for a gain of 1.3% on the day. At the same time, the S&P 500 continues to slide, last trading at 5,572 points, down 0.5% on the day. Gold prices are currently up more than 13% so far this year, while the broad equity market index is down nearly 6%.
McIntyre said it’s not just a correction in equity markets driving safe-haven demand into gold; he explained that economic risks have now risen to sovereign levels as government debt grows unsustainably.
“Governments can’t just swoop in and bail out the banks or the tech companies anymore, and that’s where the huge risks come in,” he said.
Exacerbating the economic risk is the growing deglobalization trend, as the global economy faces another trade war. McIntyre explained that the world is losing a lot of cohesion as nations look inward, with the United States becoming the poster nation for this trend as President Donald Trump continues to push his ‘America First’ policies.
“The U.S. government may be trying to rein in the deficit to some extent, but as a consequence, they are losing a lot of trust along the way, along with many of the synergies that come with working together,” he said.
Along with growing economic uncertainty, McIntyre said that he also expects this deglobalization trend to push inflation higher, supporting both gold and silver as real assets.
He noted that in the current environment, critical resources like copper and rare earth minerals will go to the nation that pays the most, making them solid inflation hedges.
“Economic growth depends so much on technology that nations are going to need to have their own stockpiles of these resources, so prices will continue to rise,” he said. “I think the race for commodities is only going to intensify.”
However, what makes gold and silver stand out compared to broader commodities is their role in the monetary system. Central banks have bought more than 1,000 tonnes of gold in each of the last three years, well above the 10-year average.
McIntyre noted that he expects nations to continue building their gold reserves as trust among Western economies continues to erode. He emphasized that gold is the ultimate stand-alone currency as it carries no third-party geopolitical risks.
McIntyre said that this central bank demand will provide a solid floor underpinning the broader market and creating value for generalist investors.
Although gold prices have moved within striking distance of $3,000 an ounce, McIntyre said that there are still plenty of opportunities for investors to enter the market.
He added that investors can buy some gold now and continue adding to their positions every time the price dips. At the same time, he recommended investing 75% of the position in gold and 25% in silver.
“If you buy when you see a correction, you won’t be putting all your eggs in one basket,” he said. “With this plan, you will never be caught chasing the market because, over time, I do expect gold prices will continue to perform well.”
Why One Survival Food Company Shines Above the Rest
Let’s be real. “Prepper Food” or “Survival Food” is generally awful. The vast majority of companies that push their cans, bags, or buckets desperately hope that their customers never try them and stick them in the closet or pantry instead. Why? Because if the first time they try them is after the crap hits the fan, they’ll be too shaken to call and complain about the quality.
It’s true. Most long-term storage food is made with the cheapest possible ingredients with limited taste and even less nutritional value. This is why they tout calories so much. Sure, they provide calories but does anyone really want to go into the apocalypse with food their family can’t stand?
This is what prompted the Llewellyns to launch Heaven’s Harvest. They bought survival food from multiple companies and determined they couldn’t imagine being stuck in an extended emergency with such low-quality food. They quickly discovered that freeze drying food for long-term storage doesn’t have to mean sacrificing flavor, consistency, or nutrition.
Their ingredients are all-American. In fact, they’re locally sourced and all-natural! This allows their products to be the highest quality on the market, so good that their customers often break open a bag in a pinch to eat because they want to, not just because they have to due to an emergency.
At Heaven’s Harvest, their only focus is amazing food. They don’t sell bugout bags, solar chargers, or multitools. They have one mission – feeding Americans in times of crisis.
What they DO offer is the ability for people to thrive in times of greatest need. On top of long-term storage food, they offer seeds to help Americans for the truly long-term. They want them to grow their own food if possible which is why they offer only Heirloom, Non-GMO, Non-Hybrid, Open-Pollinated seeds so their customers can build permanent food security on their own property.
