• Tony Hayes CFA

Cash is Trash. Buy Gold and Shares

Gold to Continue Rising to Record Levels as too Much Money Chases too few Liquid Hard Assets

It is not enough to say that the U.S. dollar price of gold is rising because the U.S. dollar is falling. The price of gold is rising in all currencies. Individual currencies are rising and falling relative to each other like deckchairs on a ship but the Titanic is sinking leaving gold as a very visible and liquid safe haven against the explosion of monetary and fiscal stimulus that has taken place around the world in response to COVID. Swapping one currency for another is on a hiding to nowhere.

With gold rising in all currencies existing miners and royalty companies fortunes should be affected immediately and more of the action seen already in the stock markets should continue as the gold price rises. Junior miners with projects in construction should also do well as their projects come on stream.

Exploration companies are seeing significant inflows of new capital as speciality gold investors fund them. Exploration success will be the next driver of this group of juniors move from having no assets but cash to having a viable gold resource and proven reserves. Fosterville South Exploration FSX on the TSXV ($4.75) remains a favourite holding with drilling results expected in the very near future.

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