Question Ronnie. Do you foresee the RBA making further rate...

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Dave10

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02/01/23

12:14

Post #: 65498270
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Originally posted by 1ronnie: ↑

Chris says it the way I had described it.

He expects equities to fall possibly hard in the first half of year, pulling precious metals and gold stocks down along with it, and a great opportunity lies when it bottoms several months before the bear market ends and the bull begins. In other words to stay patient, a new gold bull market awaits at the other end and it could be a big multi year rally.
I believe for the first half of 2023, Gold will move in the same direction as equities and ditto for gold stocks. So far gold stocks has done well over the past two months due to rising equities and expectations of lower rates ahead. The one big catalyst that could pave the way for Gold to move strongly higher on a sustained basis is if Putin introduces a petro-gold trading regime. If you already held Gold from back then, you are already invested but if you aren’t then you are under-exposed, and I am talking about physical/digital Gold not Gold stocks.
Best to listen to Chris and understand his take on possible sequence of events , he believes the the dollar will make a comeback, of course all in line with the thesis of an equity collapse in the months ahead.
It’s simple. You are either the bear camp expecting a market collapse in the months ahead with everything being sold off OR a soft landing camp that believes the Fed comes to its senses to pivot in time to avert a recession. And for gold stock investors you have to hope for the latter outcome. Based on past precedents, a back to back year fall in equity markets is unusual but when it happens it is usually very bad like the 30s. I am not a bear hoping for the 30s like scenario but we should be prepared for such an outcome, and if it turns out to be better, well at least the property fall would end and we could jump back into equities for a hopefully more consistent ride upwards as conviction returns to the market. Yes, we may not make 50pc return but still a good bet with a 15-20pc return being late to the party but on safer ground.

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Question Ronnie. Do you foresee the RBA making further rate increases into the first half of 2023? I sense consumer data, unemployment data and net savings to remain robust through to March (Q1), before the hangover and reality of successive rate rises dawns and consumers commence spending less, foreshadowing an unwinding of economic indicators ‘hoped’ by central bankers.

I suspect based on strong consumer and employment reads in December, aided by a sense Xmas / New Year spending remains drunkenly buoyant, the RBA will increase by 25BPs in February and then sit and wait.

All of this of course assumes no major overarching new news that changes the domestic environment.

Your thoughts?

Last edited by Dave10: 02/01/23
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0 Great analysis

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