After sprinting to record highs, it posted its sharpest drop in years this week as traders took profits and reset their positions. But big moves like that don’t kill a bull market; they clear the deck.

If the longer-term drivers – central bank buying, deficit worries, and a firm dollar trend that can turn – stay in place, the metal still has room. Pullbacks are simply the toll you pay on the highway.

That sets the stage for Barrick Mining (NYSE: B).

Barrick is a diversified operator, not a one-mine bet. It runs Tier One gold assets in Nevada, the Dominican Republic, Tanzania, and Congo, plus a growing copper arm in Zambia and a huge copper-gold project in Pakistan.

The company’s playbook is simple: Keep a strong balance sheet, push costs down, and fund the next wave of growth from internal cash rather than debt or dilutive deals.

Its latest numbers back that up. In the second quarter of 2025, revenue was $3.7 billion. Net earnings were $811 million, or $0.47 per share, with adjusted EPS also $0.47. Attributable EBITDA (earnings before interest, taxes, depreciation, and amortization) hit $1.69 billion with a 55% margin.

Free cash flow was $395 million even as Barrick stepped up spending at Lumwana (the copper mine in Zambia) and Reko Diq (the copper-gold project in Pakistan). The company ended the quarter with $4.8 billion in cash and a small net-cash position of $73 million. Shareholders got a $0.15 quarterly dividend – including a $0.05 enhancement tied to net cash – and $268 million of buybacks during the quarter.

Operations are trending the right way. Gold production rose 5% quarter over quarter. Production at Nevada Gold Mines increased 11% from the first quarter on better grades and throughput, while output jumped 28% in the Dominican Republic as plant upgrades took hold. Copper production climbed 34% as Lumwana improved mining rates and unit costs fell.

Now to the Value Meter breakdown.

On valuation, Barrick’s average EV/NAV is 1.64, versus a universe average of 3.79. That tells us the stock is cheaper than its peers, because you pay less for each dollar of net assets.

On cash efficiency, the company’s average FCF/NAV is 0.84%, versus 1.11% for its peers. That’s a notch worse, meaning Barrick turns assets into free cash a bit less efficiently than the average company in our universe right now.

But there’s more to the story here. On momentum of the cash engine, Barrick’s 12-quarter FCF growth rate is 54.50% versus 46.25% for its peers. That’s better, suggesting cash generation is trending faster than the pack.

What about the stock?

Shares have ripped from the mid-teens last winter to the low $30s now, with a brief spike toward the mid $30s as gold went vertical. (The recent dip tracks the metal’s cooldown more than any change to Barrick’s story.)

If bullion finds support and copper stays firm, Barrick’s blend of low-cost gold and expanding copper should keep free cash flow coming. The pipeline – including the ramp-up in the Dominican Republic, Reko Diq, and a “Super Pit Expansion” at Lumwana – adds real torque to 2026 through 2028 without stretching the balance sheet today.

So aside from the dip in gold prices, this is a quality operator priced below the peer pack with improving operations and a clean balance sheet. For investors who want leverage to the metal without betting the farm, Barrick still looks like the adult in the room.

The Value Meter rates Barrick Mining as “Slightly Undervalued.”

What stock would you like me to run through The Value Meter next? Post the ticker symbol(s) in the comments section below.

The post The Low-Cost Gold Play That Wall Street’s Missing appeared first on Wealthy Retirement.

Below, he shares three reasons he believes gold can keep rising despite recently hitting all-time highs.

– James Ogletree, Managing Editor

Gold is the gift that keeps on giving in 2024.

Over the past few months, the metal has been trading at all-time highs.

When you look at our current fiscal situation, this shouldn’t come as a surprise (more on that in a moment).

As you’ll see in the chart below, gold reached a peak of more than $2,700 per ounce in October as people piled in at higher levels ahead of the election.

Here are three reasons the gold bull run is still going.

1. Our fiscal situation is out of control.

Our fiscal situation is pretty unbearable at the moment. Sure, the S&P 500 is consistently hitting all-time highs. People are out spending money. I went to Las Vegas a few weeks ago, and I noticed the airlines were packed on my way over there.

But the lack of visual evidence of a recession is only a short-term thing.

Over the last 30 years, our debt problem has steadily gotten worse and worse.

It doesn’t matter which political party is in office – the debt has been rising. There’s sure to be a ton more spending in 2025, so it doesn’t look like this fiscal problem is going away anytime soon.

2. Interest rates aren’t budging (despite the Fed’s efforts).

In September, the Federal Reserve made its first cut to the federal funds rate in over four years.

The intent was to lower interest rates, but that hasn’t happened.

In fact, the latest data from Freddie Mac shows the average 30-year mortgage rate has actually increased to 6.7% in the three months since the move.

This is due to the long-term rates showing that our fiscal house is not in order, meaning the government has to raise more and more money. That creates an imbalance.

You might think that a higher interest rate should equate to lower gold prices. That’s true in a conventional sense.

But these aren’t conventional times.

The truth is that if our country keeps issuing more debt and spending like crazy on the government side, interest rates can’t come down.

The only way out of the current mess is to devalue the U.S. dollar and the debt – both of which are good for gold.

3. The conflicts in the Middle East and Ukraine.

The situation in the Middle East and Ukraine also isn’t helping. We’re roughly one year removed from when tensions started to heighten in the Middle East, and it’s been almost three years since Russia launched its first military operation in Ukraine.

The cost of war to Israel’s economy is estimated to be around 12% of its GDP.

As for Russia/Ukraine, the U.S. doesn’t trade with them as much, but the war has affected U.S. businesses and caused gas prices to increase, which has contributed to inflation.

There’s also ever-lingering concern that Iran could get involved and spark a broader war in the Middle East.

This fear has already spilled bullish sentiment over to gold’s little brother – silver. For the past few months, silver has been trading at over $30 an ounce, a level it hadn’t reached since back in 2012.

A Golden Ticket

For these three key reasons, I believe gold still has plenty of room to run going forward.

What’s brewing here might just lead to the most significant gold rally of the century.

The post Bullish on Bullion: 3 Reasons Gold Could Keep Rising appeared first on Wealthy Retirement.

In the film, the Soggy Bottom Boys sing “I Am a Man of Constant Sorrow,” which is a tale of woe from someone who can’t stay out of trouble.

I was reminded of the song a few weeks ago when I had dinner with a friend who can’t stay out of financial trouble. He constantly makes the wrong decisions. I’m not talking about buying tech stocks when he should have bought healthcare stocks. Or not allocating enough to bonds.

I mean big mistakes that cost him dearly.

He’s always looking to strike it rich with one big play. I detailed an earlier conversation with him in 2018 when he asked me for one stock to fix his finances.

Spoiler alert: I didn’t give it to him but explained the concepts of growing his money safely (which are detailed in the linked article above).

Surprise, surprise! He didn’t listen.

Over burgers recently, he told me that he lost $50,000 in an investment. That was $50,000 more than he could afford to lose. It was some harebrained crypto thing that he didn’t understand, and he lost his entire investment in a matter of months.

I felt terrible for him. My buddy is a good guy. When he has money, he’s overly generous. But his finances fluctuate more than Joe Pesci’s temper in every movie he’s been in.

My friend committed two huge mistakes:

1. He focused on one investment.
2. He invested more than he could afford to lose.

I’ve ridden out bear markets calmly by investing in a variety of sectors and asset classes so something is always working. Even if stocks are way down, I have money in precious metals and fixed income, which takes some of the sting out of it. I also keep cash handy to put to work when stocks have fallen so I can take advantage of lower prices and make outsize returns.

If most or all your money is invested in a small concentration of investments, you have fewer opportunities to hit a winner. In addition, there’s a very strong chance you’re going to miss a big move in one market because you were unable to deploy cash when prices fell.

Additionally, you should never invest more than you can afford to lose, especially in a speculative investment. There’s nothing wrong with taking a flier on a riskier trade if you can handle things going south. But you should never be in a position where, if things do go wrong, you’ll be wiped out or suffer a loss that will be tough to come back from.

Wealthy Retirement‘s publisher, The Oxford Club, recommends that no more than 4% of your portfolio be invested in any one position. And it oftentimes recommends a 25% trailing stop, which gives most stocks plenty of room to move and withstand market noise. So if you allocated 4% into a position and got stopped out with a 25% loss, your portfolio would be down only 1%.

A 1% decline is not difficult to come back from. A 50% or 100% loss is.

If your portfolio is too concentrated in just a few investments, get busy diversifying. The great thing about being an investor today is that with online brokers, trades are usually free or close to it. So it won’t cost you to move money around into different assets.

And if you haven’t seen O Brother, Where Art Thou? – or even if you have – watch it this week. That will be the third-best recommendation in this column.

The post Two Huge Investing Mistakes to Avoid appeared first on Wealthy Retirement.

Gold and silver are often useful hedges against inflation over the long term.

Silver tends to go up with the overall economy due to sizable industrial demand. And even though many people are calling for a recession, silver has performed well.

Meanwhile, gold has been climbing in conjunction with and in anticipation of higher interest rates.

Chief Income Strategist Marc Lichtenfeld says the recent moves in both metals are just the beginning.

The last time he was this excited about gold was in 2000… before it made a huge run higher.

So you should probably listen to what he has to say…

The post Expect Gold and Silver to Shoot Higher appeared first on Wealthy Retirement.

If you don’t own any gold, should you buy some now? If you do already own some, should you buy more?

I’ve never been a huge gold bug. You’re supposed to own gold for a number of reasons, including having it as a store of value when the spit hits the fan.

Some claim that with countries, and especially the U.S., printing money as fast as possible, ballooning the debt and devaluing their paper-based currencies, gold is the only real money.

But gold doesn’t generate dividends or produce cash flow and is worth only what the next person is willing to pay for it. As you may know, I like my investments to pay me cash on a regular basis.

That being said, I do believe gold belongs in your portfolio – especially right now.

Over thousands of years, gold has more or less kept up with inflation. There’s an old axiom that an ounce of gold typically has the same value as the price of a man’s quality suit.

Obviously, the price of gold will have strong moves higher and lower, but over time, that is generally perceived to be the value.

I have reason to believe that it could go even higher THIS year. Click here to learn more.

But that is precisely why you should own a little bit of gold. Because it does make these very strong moves higher when conditions are right.

And right now, the conditions are right. There is currently a MASSIVE gold shortage. (Click here to see my latest research on the topic.) Try calling a gold coin dealer and see what kinds of premiums they charge you – that is if they even have any gold coins to sell.

Gold allows you to diversify your portfolio in a way that is not correlated with stocks.

Right now, stocks keep ticking higher, yet the price of gold recently hit a 10-month low. And that’s a good thing. It allows investors to add gold or gold-related assets at low prices.

It’s smart to have assets that don’t move in conjunction with each other in your portfolio. That way, there is always something working, even when markets are weak.

Gold is one of those noncorrelated assets.

Despite the fact that I am not a huge gold bug, I own some gold for this exact reason.

With the money printing press working overtime all over the world and inflation starting to tick higher, it makes sense to own gold or gold-related assets, which are noncorrelated to the stock market, in your portfolio.

Good investing,

Marc

The post Why Gold Deserves a Place in Your Portfolio appeared first on Wealthy Retirement.

Inflation is coming – and likely sooner than expected.

He’ll show you how to safeguard your portfolio below…

– Mable Buchanan, Assistant Managing Editor

We have been stuck in a low inflation environment for so long, it’s hard to remember when inflation was ever a problem. The last time inflation was even 3% was in 2011.

The last time prices rose 5% in a year, it was 1990. Since 1914, the average historical inflation rate has been 3.24%.

In July, consumer prices rose a paltry 1% annualized, so inflation isn’t on many people’s radar.

But it should be…

The federal government printed more money in June than it did in the first 203 years of this country’s existence. It has already approved more than $10 trillion in stimulus funds, and more are likely coming.

You know the saying… A trillion here, a trillion there… Soon, it adds up to real money.

(That joke used to be told with billions, not trillions.)

My Bold Prediction

All of that money sloshing around is inflationary. We’re already seeing it in the markets – stocks and real estate are on fire.

I expect we’ll see it in everyday prices as well. Money will join other limited goods and services – particularly as hundreds of thousands of businesses around the U.S. close for good.

The market seems to expect higher inflation judging by the spread on Treasury Inflation-Protected Securities (TIPS).

This spread is the difference between the 10-year Treasury bond yield and the 10-year TIPS yield. (TIPS are Treasurys that keep up with inflation. Regular Treasurys do not.)

When the spread between the two rises, as it has done since March, that indicates the market expects inflation to climb.

The current TIPS spread is 1.73. That is hardly hyperinflation, but it has been steadily rising and is above the average for the year. I expect this trend to continue.

Perhaps the most important reason inflation will rise is Fed Chair Jerome Powell saying on Thursday that he’s going to let it.

Previously, the Fed’s inflation goal was 2%. That meant the Fed would raise rates if inflation peaked above 2%.

On Thursday, Powell said that even if inflation rises above 2%, he will keep rates near zero.

When was the last time the Fed got its timing right? It typically overshoots its goals, adjusting interest rates too quickly or too slowly.

I have little doubt that inflation will roar higher before the Fed is forced to play catch-up. And it will happen sooner than most people think.

Safeguard Your Portfolio Now

So how do you protect yourself from higher inflation before it eats away at your buying power?

Here are a few ideas…

1. TIPS. As I mentioned, TIPS are Treasurys that keep up with inflation. However, it’s important to understand that TIPS pay a small amount of interest twice a year. Then the adjustments for inflation are added to the principal.So when the bond matures, you receive your principal plus all of the inflation-related adjustments.
2. Gold. The shiny yellow metal has been used as a hedge against inflation for years. While it has strong moves higher and lower, over the long term, it does a decent job of keeping up with rising prices.
3. Perpetual Dividend Raisers. These companies raise their dividends every year.If you invest in a stock whose dividends are rising 8% or more per year, chances are that even after taxes, you will be way ahead of inflation and will actually increase your buying power.A company like AbbVie (NYSE: ABBV) is a great example. It has raised its dividend every year since it was spun off from Abbott Laboratories (NYSE: ABT) in 2013. It has hiked its dividend by a compound annual growth rate of more than 16% per year.

Not a lot of people are warning about inflation yet. But they will when it’s too late.

Take steps to protect your buying power today so that when prices rise, your portfolio is well-equipped to handle it.

Good investing,

Marc

P.S. Did you catch our note on Saturday? We are honoring eight years of Wealthy Retirement by hearing more about our readers’ experiences. Has our research helped you be better prepared for the twists and turns of retirement?

If you have five minutes, please fill out our short survey here. We’d love to hear from you.

The post How to Beat Rising Inflation appeared first on Wealthy Retirement.

If you don’t own any gold or silver, should you buy some now? If you do already own some, should you buy more?

I’ve never been a gold bug. You’re supposed to own gold for a number of reasons, including having it as a store of value when the spit hits the fan.

However, my thoughts on gold were formulated by talking to family members who were in Europe during World War II. Gold did not come close to holding its value during the chaos, regardless of what the official exchange rate was.

A loaf of bread or a night’s rest in a barn after fleeing across the border was going to cost you your gold or other valuables. There was no bargaining. If you were starving or needed a place to hide, you handed over what you had or risked the consequences.

Those were extreme times, but those kinds of circumstances are exactly why some people want an ample supply of gold for themselves.

And some claim that with countries, and especially the U.S., printing money as fast as possible, ballooning the debt and devaluing their paper-based currencies, gold is the only real money.

But gold doesn’t generate dividends or produce cash flow and is worth only what the next person is willing to pay for it. There is no way to appropriately value an ounce of gold. Whether it’s worth $400 an ounce or $4,000 an ounce is pure speculation.

That being said, I do believe gold belongs in your portfolio.

Over thousands of years, gold has more or less kept up with inflation. There’s an old axiom that an ounce of gold typically has the same value as the price of a man’s quality suit.

Obviously, the price of gold will have strong moves higher and lower, but over time, that is generally perceived to be the value.

Today, gold sits at around $2,000. That’s a pretty darn nice suit. You can get a high-quality suit at Nordstrom for half that amount or probably less.

So from the suit valuation metric, gold is overvalued.

But that is precisely why you should own a little bit of gold. Because it does make these very strong moves higher when conditions are right. Gold allows you to diversify your portfolio in a way that is not correlated with stocks.

Both gold and stocks are running hot right now. But it doesn’t always work that way. During the dot-com crash, gold prices increased while stocks fell. Between 2011 and 2015, gold fell by more than a third while the broader market climbed more than 50%.

It’s smart to have assets that don’t move in conjunction with each other in your portfolio. That way, there is always something working even when markets are weak.

Gold is one of those non-correlated assets.

Despite the fact that I am not a gold bug, I own some gold for this exact reason.

Wealthy Retirement‘s publisher, The Oxford Club, recommends 5% of your portfolio be allocated to gold and precious metals.

So should you buy gold?

It depends on your current allocation.

If you have less than 5% of your portfolio in gold, then it’s a good idea to add some. If you’re already at a 5% allocation or more, I wouldn’t buy any more other than for a short-term trade.

Good investing,

Marc

The post Should You Buy Gold Now? appeared first on Wealthy Retirement.

As a gold investing expert and trusted Pillar One Advisor for Wealthy Retirement‘s publisher, The Oxford Club, Asset Strategies International helps everyday folks use gold investing as “wealth insurance.”

Now, as we’re threatened with a prolonged bear market, Rich is helping investors catch up and prepare themselves for more downturns in stocks, and he’s offering a free Silver Eagle with each qualifying purchase to help you get started.

You can contact Rich by calling 800.831.0007 or by visiting Asset Strategies International’s website.

– Mable Buchanan, Assistant Managing Editor

The one-month carnage in U.S. equities is substantial. After hitting an all-time high a month ago, the S&P 500 has surrendered $10 trillion in value.

The first cases of COVID-19 were reported in December. As a result of panic at the hands of this microscopic threat, here’s how the markets have fared since the start of 2020…

• The Dow Jones Industrial Average is down by more than 22%.
• The S&P 500 is down by more than 19%.
• The Nasdaq is down by more than 14%.

The real concern among investors is that we are nowhere near the bottom. The speed at which these markets collapsed is nothing less than scary.

But the recession this tiny virus caused should not have been a surprise. The “everything bubble” created by easy money was eventually going to burst. And the bigger the bubble, the bigger the bang.

A pin invisible to the naked eye was the catalyst to pop the biggest bubble of all.

Gold to the Rescue?

It’s hard to grasp the concept, but gold actually did come to the rescue…

Yes. At first, gold dropped alongside stocks, but the difference is in why it was sold and how quickly it is recovering.

Gold was sold off initially – as it often is in a financial crisis – by investors seeking to tap its liquidity to meet margin calls or to raise cash for the uncertain weeks and months ahead.

But since gold’s price did not drop as a result of any fundamental weakness, bargain hunters swooped in – again, as they often do – to buy gold cheaper than it ought to be.

As a result, since the beginning of 2020, gold is up by more than 7%.

Where Does Gold Go From Here?

For me, there is no doubt… gold will go significantly higher.

That said, you should expect the volatility in all markets to continue until the number of unknowns is less than the number of knowns.

Along the way, the gold price will continue to be sentiment-driven. Like the stock market, gold will rise and fall on the latest news of the day.

But I fully expect to see the frequency and magnitude of the price movements on the good days to outweigh the frequency and magnitude of the price movements on the bad days.

We are in a bull market for gold, and higher prices are where we are headed.

To help us get there, we expect strong central bank buying to continue. We expect investor demand to continue and increase in volume.

We also expect the Federal Reserve to maintain its accommodative stance, eliminating the opportunity cost of holding gold. With negative real returns on cash and deposit accounts, holding gold is a better option for investors.

Limited Supply and Soaring Premiums

Now, it goes without saying that it is better to have already bought your gold as wealth insurance before the emergency presents itself. Easy concept to grasp.

You buy auto insurance before you wreck your car. You buy homeowners insurance before your house burns down.

After the fact, insurance is either unavailable or incredibly expensive.

It is the same when using gold as your wealth insurance. After four to five years of limited demand, the government and private mints settled into production levels to meet relatively weak demand. Everyone was buying stocks. Few cared about gold.

Then, in one month, $10 trillion of value was erased from the S&P 500. Greed gave way to fear in a massive way. Demand surged, but production could not keep up nor catch up.

Quickly, bullion coins and bars in sizes retail investors prefer and can afford were gone. Just as with toilet paper at the grocery store (we haven’t seen a roll on a shelf in nearly a month), supplies run out, delivery times grow longer and premiums rocket higher.

Immediate Delivery and Tiny Premiums

To my knowledge, there is only one place you can go right now to buy gold, silver and platinum physically, have it delivered immediately, and pay only 2.25% or less in premium.

Nearly 25 years ago, we first introduced the Perth Mint Certificate Program to Oxford Club Members.

This program, along with Perth Mint’s new online program (Perth Mint Depository Distributor Online), is tailor-made for putting more of your hard-earned money into precious metals and less into dealer premiums.

And they are the only two programs in the world with a government guarantee.

Most importantly, they are the only way to buy your wealth insurance in the midst of the financial crisis without being penalized.

Unless you enjoy throwing away $0.45 on every dollar you spend on wealth insurance, consider diversifying into gold now.

Good investing,

Rich

The post Is Now the Time to Buy Gold? appeared first on Wealthy Retirement.

It has had outsized moves nearly every day since February 19.

The coronavirus is scary stuff. Because it’s so easily transmitted, even from people who show no symptoms, it could prove very tough to avoid.

And aside from the human toll, which is frightening enough, the economic impact could be tremendous.

The travel and events industry is getting annihilated as people cancel trips and conferences. The ripple effect from people holing up in their homes is likely to be significant.

Consider…

• The airline industry could lose out on between $63 billion and $113 billion in revenue.
• The Organization for Economic Cooperation and Development said global growth could be cut in half if the virus continues to spread.
• Gross domestic product growth will be slowed by 0.1% to 0.3% in the United States in the first quarter, according to the U.S. Chamber of Commerce.If we start to see events canceled and things shut down in America, I suspect that estimate will be way too low.

Adding to the market’s misery is the perception that the federal government does not have a handle on the situation.

Reports of quarantined people who are unable to get tested, leaders who can’t get their facts straight and the politicization of the virus are ratting confidence.

That lack of trust in our leaders makes people more scared and investors more likely to panic and hit the “sell” button.

The problem is what to do with the cash after you’ve sold…

One of the most important stories not being talked about right now is the crash in interest rates. Two months ago, a 10-year Treasury yielded an already ultra-low 1.8%. Today, it’s a third of that rate.

In fact, just in the last two weeks, the rate plunged more than eight-tenths of a percentage point below the previous record of 1.33% in 2016.

It was a surprise move from the Fed last week to cut rates by half a percentage point. The market expects another similar move shortly.

This is further evidence that the government has no idea what it’s doing. Prior to the outbreak, markets were at all-time highs and the economy (if you listened to the government and pundits) was very strong.

Yet after a two-week shock to the system, the Fed is taking drastic measures to try to spark the economy when we don’t yet know how or even if it’s sick.

It’s like using a defibrillator on someone who called in sick because of a chest cold.

Interest rates were already near record lows before the Fed cut. No one is going to buy a home now because of low rates if they weren’t planning on it two weeks ago. No CEO is going to decide to build a new factory tomorrow if they didn’t expect to last month.

So now that interest rates have been crushed, what do you do about it?

• Buy certificates of deposit (CDs). Look for some CDs with a decent interest rate that you can lock in for a few months. Rates could move back higher… or they could go to zero.If you can earn 1.5% or higher for three to six months, that’s probably as good as it’s going to get for a little while.
• Buy quality dividend stocks.  Dividend payers went on sale these past two weeks. And those juicy yields look even more enticing now that interest rates are insanely low. You can own quality companies with impressive yields a lot cheaper than you could have a month ago.
• Don’t panic. Chaotic markets are scary. But you should remember that they happen from time to time. Over the years, the market has seen all kinds of terrible things – wars, scandals, assassinations, terrible presidents and Congresses, etc. – and the market went up over the long term regardless of those things. And in all of those cases, you usually didn’t have to wait long for a rebound. The last bear market lasted less than a year and a half.

We’ll be out of this mayhem market soon. These things don’t last forever. The important thing is not to make emotional decisions about your finances when you’re worried about something else.

Chaos isn’t fun. But it will likely present opportunities in the future.

Good investing,

Marc

The post How to Handle a Market in Chaos appeared first on Wealthy Retirement.

As you know, Wealthy Retirement is published by The Oxford Club. Asset Strategies International is one of The Oxford Club’s trusted Pillar One Advisors, vetted experts who we defer to when we have specific questions or concerns.

Rich and his team at Asset Strategies International are our go-to experts on gold and precious metals. Given the recent market correction, we asked Rich if now was the time to invest in gold.

So, today and tomorrow, Rich will offer his take on the overlooked drivers for a gold spike that predated the coronavirus panic’s flight to precious metals. Read on to discover why he believes the stock market was overdue for a correction.

And if you’d like to get in touch with Rich to learn more about Asset Strategies International, you can reach his office at 800.831.0007 or by clicking here.

– Mable Buchanan, Assistant Managing Editor

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About a month and a half ago, just as the first reports of the coronavirus epidemic were coming out of Wuhan, China, we provided our clients with an update on the gold and silver markets.

At the time, we listed several hypothetical events that might provide a catalyst for a stock market correction and resulting rise in gold prices.

One of those catalysts was a black swan event, such as a coronavirus epidemic. Unfortunately, we were right with that prediction.

But make no mistake – the switch in investor psyche from greed to fear was going to happen anyway. The coronavirus epidemic simply hastened it along.

First, let’s look at what has happened since last month.

Tomorrow, we’ll take a look at what you can expect next for gold.

COVID-19’s Rapid Spread

The very first reported instance of COVID-19 – the disease caused by this most recent strain of coronavirus – was in Wuhan, China, in December of last year.

Two-and-a-half months later, it has been reported in 71 countries, has accounted for nearly 90,000 infections and is responsible for more than 3,000 deaths.

Why all the concern? Why all the panic?

Simple: COVID-19 spreads quickly and has a relatively high death rate. That’s a one-two punch worth paying attention to.

Granted, deaths attributed to COVID-19 are less than 1 to every 216 of the deaths attributed to influenza… 3,000 versus more than 650,000. But the speed at which COVID-19 deaths occur is quite alarming.

The COVID-19 fatality rate appears to be somewhere between 2% and 3.5%. The death rate associated with the flu is roughly 0.5%. COVID-19 claims lives somewhere between four and seven times faster than the flu.

Market Impact

While all of the above makes perfect sense, what may not be as clear is why the stock markets of the world have reacted so quickly and so negatively to the virus’s spread.

Last week alone, the Dow Jones Industrial Average fell 14%. The S&P 500 fell 13%. The Nasdaq fell 12.3%.

Equities are now in official “correction” territory (a drop of 10%) because, simply put, businesses are adversely impacted by the threat of a pandemic.

On the extreme side of things, whole economies are being shut down to contain the spread of the virus. Buildings and even towns are facing quarantines in China, South Korea and Italy. Business has basically ground to a halt.

But worldwide, it goes even deeper than that. Air travel, tourism and international supply movements are also suffering. People and things are not moving across borders for fear of spreading the virus.

How long can businesses sustain themselves when they cannot deliver products to their customers?

Needless to say, a long-in-the-tooth bull market with excessive valuations and historically high price-to-earnings ratios is susceptible to a pullback with much less of a catalyst than the COVID-19 outbreak.

Gold’s Rise

Whereas the stock market is vulnerable in such an environment, gold is poised to benefit.

Prior to the rise of COVID-19, the U.S. stock markets (the Dow, S&P 500 and Nasdaq) were all up around 10% on the year. Gold was actually in the midst of a short-term pullback.

Since then, they’ve all done an about-face. On the year…

• The Dow is down 9.4%.
• The S&P 500 is down 7%.
• The Nasdaq is down 2.8%.
• Gold is up 5%.

It is quite likely that this trend will continue.

Look for my follow-up article tomorrow. In it, I will dig deeper into the potential impact of what I suspect to be the strongest contributors to gold’s long-term appreciation…

• Upcoming Federal Reserve interest rate decisions
• Political unrest
• Social unrest
• Protectionism

Keep Calm and Carry On…

I am no expert on viral replication or pandemics. But I am also no fearmonger.

I fully expect the COVID-19 outbreak to travel a bit farther – and unfortunately claim more lives – before its eventual defeat.

In the meantime, this epidemic has triggered a stock market correction that was long overdue. Those who protected themselves prior with the ultimate wealth insurance – gold – have done well.

But if you have not yet purchased your golden wealth insurance with personal and IRA funds, I strongly urge you to consider these steps now. The correction in the stock market is expected to continue.

Don’t panic. Seek the protection of gold. And look for my follow-up article tomorrow to see why I believe gold will reward those who own it… long after COVID-19 is relegated to history.

Good investing,

Rich

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