Unlike many hedge funds trading paper assets, we think gold is heading much higher because its supply-side balance will eventually experience a HUGE short-covering thanks to the funds short the market.
Eventually, all short positions need to be bought. When the shorts cover their shorts, there will be major buying pressure moving the market prices up.
More so, as with any tangible asset, gold’s most-important pricing factor is the total cost of production. It’s quite simple, if you aren’t making money, you will stop working. If producers aren’t making money, they stop producing.
Right now, today’s low gold prices are simply unsustainable for the industry.
As gold will rise; so will silver.
Fresh off the newswire this morning, gold and silver sell off sharply to create another buying frenzy. U.S. dollar index soars on stronger than expected jobs report, including upward revisions in NF jobs growth for April and May