A Year for Accumulation, Jeff Christian September 2019 Part 1
Sean Brazney: Hello, my name is Sean Brazney, Sales Director for Monex Deposit Company. I'm here with Jeffrey Christian, Managing Partner and Founder of CPM Group and the author of our Year for Accumulation Report. Thank you for being with us today Jeffrey.
Jeffrey Christian: It's good to be here, yes.
Sean Brazney: Jeffrey, in the beginning of the year, we were still in somewhat of a down trending to maybe sideways basing kind of market and at the time dealing with some low $1,200 gold, low $14 per ounce silver, and over the course of the first six months of this year, had investors heeded your advice and accumulated during that time frame, they would be in a really good position right now. So, I wanted to really thank you for the report, the data that's in the report, and for doing these videos with us.
Jeffrey Christian: We're happy and we're glad to work with Monex. We've worked with you guys for decades and we're glad to be doing it.
Sean Brazney: Over the last few months, really going back to June, it looks like the market has really turned into an up-trending market. In the beginning of the report, you mentioned that there are two bull runs to focus on right now, one being the short-term and one being the long-term. Can you break that down for us?
Jeffrey Christian: Yeah, since late June, since the last two weeks of June, we've seen gold prices and then silver and platinum joined in, rise sharply, and gold has risen quite dramatically since late June. One of the points that we make in your September Monex report is that what we've seen as a lot of short-term buying: ETFs, futures forward, options, things like that. We really haven't seen a lot of longer-term investors coming into the coin and bar market. We do think that they will, but what we've seen right now is a short-term bull market that's been characterized by a lot of short-term investor involvement. We're looking for that to be joined... and that's the first bull run to watch for. The second and bigger bull run and the much more important one is the longer-term one. We do think that the short-term investors will be joined by long-term investors at some point. You know, everyone is looking at the state of the world politically, economically, financial issues, interest rate issues, currency issues, and at some point all of those factors are... they're growing more significant. What we've seen is investors starting to pay much more attention to them. There are any number of investors around the world who have said to us, "Look, we're worried about these issues on the long-term basis, but in the short-term basis they're not necessarily having a negative impact on the stock market, or real estate, or currencies. So, we're not going to necessarily move into gold." That's changing now and you're starting to see those longer-term investors prepare to mobilize, if not actually mobilizing. That leads to the second bull market, which is a much bigger, longer-term bull market. Our view is that it could last five to six years and our view is that it takes gold prices to record levels over that five to six year period. That's just beginning. So, one of the metaphors we've been using is that, "We're in the foothills. We're not in the mountains, yet."
Sean Brazney: You also made a comment in the report that CPM feels that gold prices may outperform silver over the next several years, even with silver prices spiking. I talked to a lot of diehard silver investors who seem to always think that silver always outperforms gold. So, just wondering if you could share with us some data for that comment.
Jeffrey Christian: Well, silver often outperforms gold in percentage price increase during those spikes and that reflects, I think, the fact the silver market is much smaller in dollar terms and is thus much more volatile, but what we're doing is we're looking at longer-term issues of gold and silver supply, fabrication demand, invest demand, inventories out there, and we think that the gold market is in much better shape to have a larger and longer and more sustained bull market this time than silver. Silver is, you know, this schizophrenic mammal, it is a financial asset like gold and currencies, but it is also an industrial metal, and it has a lot of things hanging over it that gold doesn't have. In addition, which gold is a much more universal financial asset. You'll find investors interested in gold around the world in virtually every country. Whereas, in silver, there are certain regions, Western Europe being one of them, where silver is less of an attractive investment on a financial asset perspective than gold.
Sean Brazney: So, we're going to remind our viewers to give Monex a call today, talk to an account representative, and ask for your free Year for Accumulation Report. Thank you for your time, Jeffrey.