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Mike Maroney Interviews CPM Group's Jeff Christian on October 2018

October 13, 2018
Video Transcript

Mike Maroney: Good afternoon! It's Tuesday, October 9th. My name is Mike Maroney. I am here today with Jeffrey Christian, the Managing Director of the CPM Group. We're doing our, "Prepare & Diversify with Gold & Silver" video.

Now, Jeff, we spoke a little bit yesterday, and obviously, many investors are watching the precious metals market, and the common theme seems to be... Is the market bottoming? What's your view on that?

Jeffrey Christian: Our view is that the market is bottoming. It's weaker than we had thought it would be, but it still looks like to us as if it's bottoming. We think that the initial response in October may be a little bit more muted than we had thought.

Mike Maroney: Now, if you look at silver for this decade, the low is $13.60 and we had a low of $13.80 in the spot market just a little while back. The low for this decade in gold is $1,045.00. We saw a low of approximately $1,160.00. So, gold has been a little bit stronger and it's kind of unusual, because you would think that the industrials seem to be doing better a lot of people thought that maybe silver could outperform gold. What do you think about that?

Jeffrey Christian: You have some very interesting divergent opinions in the markets right now. What we think is going on is that there are a lot of investors who are looking at the world economy, the U.S. economy, financial markets, the stock markets, and they have a lot of long-term concerns about where the economy is going and where the stock market is going, but they're looking at a relative strong economy and stock market right now. So, we think, what you're seeing this year is weaker industrial commodity prices and relatively stronger gold prices, because investors are buying more gold as a financial asset, as a safe haven, and against these longer term economic and political and financial concerns they have. While, they also are looking at the more industrial oriented metals and saying this is probably close to the peak for the economy and 2019 is probably going to see weaker industrial demand for commodities across the board. So, that these things are probably less interesting, but gold as a financial asset, as a quasi-currency, as a safe haven, probably is a more attractive asset.

Mike Maroney: So, in essence, silver is somewhat trading as an industrial commodity, not as much a precious metal, but do you feel that silver will regain its stature as a precious metal in the coming months?

Jeffrey Christian: Absolutely! One of the things that you are seeing is also the fact that silver is a much smaller market in dollar size than gold, it always tends to see more volatile prices, but our view is that, right now, it's being weighed down by its industrial nature, but when you get into 2019 and going forward, whenever these economic issues come home to roost, gold prices will rise. When that happens, we think that silver will surge too and play catch-up with gold.

Mike Maroney: Well, obviously, if you prepare and diversify with gold and silver, the trick is to buy low and based on the current price levels, it looks like now may be a tremendous time to start looking at diversifying with the precious metals.

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