Mike Maroney Interviews CPM Group's Jeff Christian on August 2018
Jeffrey Christian and Mike Maroney
In this video, taped in August 2018, CPM Group Managing Director Jeff Christian offers his forecasts and recommendations for investors seeking to take advantage of the opportunities in precious metals in 2018 and beyond.
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Mike Maroney: Good afternoon! It's Monday, August 6th. My name is Mike Maroney. I had a chance to speak with Jeff a little bit before the video started. We were conversing about the fact, that we have seen the dollar rally on uncertainty and this has affected commodities overall and both gold and silver are trading near their lows. Silver traded as low at $15.15 last year in July, before rallying all the way back up to $18.40 and gold in December was as low as $11.40, before rallying back up to $13.60-$13.70. Jeff, do you feel as if the precious metals and specifically both gold and silver are in the process of putting in a bottom or are they in the process of trying to find a new trading range?
Jeffrey Christian: I think gold and silver are in the process of finding a bottom. I don't think that we're going to stay down here in low for long. I think that what we'll see is similar to what we saw, as you said, in December and again last July. I think we're looking at seasonal weakness here combining with dollar strength and a variety of other factors and that probably September, October, we're going to see these markets turn around and the prices will rise sharply from here and they'll go back into an earlier trading range.
Mike Maroney: I see. Recently, the dollar has actually been the safe haven and gold and silver has been affected in a negative fashion. What do you see potentially changing that in the near term that could potentially give us upside impetus as far as the metals are concerned?
Jeffrey Christian: I think that what we're going to need to see for gold and silver to bottom out and start rising and for the dollar to peak and start falling is some increase in clarity about where we are in the world politically, internationally, economically. I think that that will probably emerge over the next two months, you know, August into September into October. I think by the time we get into October, it’s going to be a lot more certain and there's going to be a lot more clarity as to where we are economically and politically. I think that that will then cause the dollar to peak and come off and it will probably also cause value investors to come back into the gold and silver markets.
Mike Maroney: Now Jeff, you've been phenomenal this year as far as your predictions are concerned. You felt that, one, we would see the $17's in silver, but thought that we could see silver come all the way back down and retest the low $15's. Right now, it sounds like you feel that both gold and silver are at a pretty good area as far as an accumulation point is concerned. Am I correct?
Jeffrey Christian: Absolutely! It's funny, because I was talking to one of our high net worth individual clients a couple weeks ago and I was showing him seasonality charts on gold and silver, platinum and palladium prices. I was showing him how weak seasonally gold... all of the precious metals tend to be in July and August and then they tend to rise in September and October and he said, "So, now's the time to buy." I said, "Well, September is really when the price gets good." He said, "I don't want to buy gold when the price has already started rising. I want to buy it now, because this is the weakest time historically for gold and silver prices," and that's exactly what we feel. This is a great time to accumulate. Could the prices go a little bit lower... another $40 or $30 in gold, another $.30 in silver? Yes, they could fall that far, but it may not make sense to wait for that low and try to get that last $.30 in silver or last $30 in gold. It may make sense that these are good prices, and by Christmas time I'll be happy, and three years hence from now, I'll probably be happy that I bought gold and silver at these prices.
Mike Maroney: Fantastic! What's the old saying... "There's times when you don't wait to buy, you just buy and wait," and it looks like we may be in one of those situations.