Paul Mladjenovic: Gold isn’t done climbing (and apparently neither is silver)


MarketWatch/Myra P. Saefong/02-09-17

Gold typically has an inverse relationship with the stock market but I believe this will change under Trump. I think that gold and quality stocks have a strong chance of both hitting new highs in due course.

Gold will go from being a “safe harbor” asset (financial/economic crisis) to an inflation hedge (too much spending/stimulus). As Trump spurs economic growth, this can ease some of the prior issues with potential crisis and replace the issue with expansive spending and trade competition, which can mean a weaker dollar and rising inflation. With rising inflation and economic growth, stocks and gold would have a bullish environment while it would become a bearish environment for the dollar.

…I believe that it will be a great year for precious metals. For reasons cited, I expect gold to go north of $1,300 later this year and I believe that silver should hit $25 before year-end. Because silver is experiencing another supply/demand deficit year, it has an outside chance of surpassing $40 in 2018.

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