Precious Metals Investor Alert: Prices Are Heading into An Entirely New Market

The comments below are an edited and abridged synopsis of an article by SRSrocco

The global financial system is under severe stress. While there have been many factors leading to this point, the situation unfolding in China and abroad seems to be speeding up the process. The market has woken up with respect to a global contagion and the rapid contraction of the ‘just-in-time’ inventory supply chain system.

Precious Metals Investor Alert: Prices Are Heading into An Entirely New Market | B ullionBuzz
The Index of Gold on The Screen.

The Dow’s recent losses are nothing when we take into account what is coming in the weeks and months ahead. Because China accounts for 21% of global GDP and it supplies a lot of goods, parts and consumables around the globe, a severe contraction will affect the rest of the world in short order.

But what if this contagion, the coronavirus, spreads to other countries, as we see in Iran and Italy? Then we are looking at a much more severe systemic problem. If you wait to prepare until your town or city is locked down, then you are behaving unwisely. While the situation may not get that bad, there is nothing wrong with a little insurance, just in case, and here precious metals will do exactly what they were designed to do—protect wealth.

While gold and silver have lost most of their recent gains, it probably had to do with profit-taking by traders who locked in some gains. In time, the idea of locking in gold and silver trading profits will become a distant memory as the world transitions into owning and trading physical precious metals. Thus, physical ownership and trading will replace the game of highly leveraged paper shuffling.

But we aren’t t there yet, because the market still believes that debts are assets, and that paper money is real.

It looks like the markets are getting a whiff of the contagion as the Dow takes us on a bumpy ride. This is nothing compared to what’s in store ahead.

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