Commodities
have been a disappointment for years, but I still see them as the rising stars
for the coming decade. Metals and agricultural commodities have, in my opinion,
the largest potential to grow, mainly due to their cyclicality.
My all-time
favourite is still Silver, and its bigger brother Gold. The following chart
popped up on my radar again after making the rounds in 2016, when we were all
stunned about the sudden peak in the gold inventory ratio. Back then it reached
an all-time high of more than 500 claims per ounce of deliverable Gold. Just to
clarify; this means that 500 different people think that the same ounce of gold
belongs to them. I`ll clarify again; comex has promised the same ounce of gold,
to 500 different people… I think I need to repeat this about 500 times to make
myself realize how incredibly crazy this sounds!
However, after the newsflashes faded, the inventory ratio faded as well, going all the way down to a “mere” 30 claims per ounce of deliverable gold in 2017. The chart has now gained popularity again, because it is almost hitting 400 claims per ounce of deliverable gold. The big question now is: will it fade once again, like it did in 2016? Will there be a run on COMEX inventory? Or will the price of gold just rise, with a lower number of claims as a result?
In January
2016, the peak was followed by a 28.7% rally over the following months. Looking
at all the geopolitical troubles, I wouldn`t be surprised at all if history
repeats.
The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in this publication is that of the publisher and is subject to change without notice. The information in this publication may become outdated and there is no obligation to update any such information.