by David Kranzler
Investment Research Dynamics
“There is a growing recognition that the much-heralded V-shaped recovery is not going to happen beyond a temporary recovery following lockdowns. That being the case, the Fed is committed to unlimited monetary inflation, which is already undermining the dollar, the trade weighted version of which continues to decline.” – Alasdair Macleod, Goldmoney.com
Institutional investors have maybe 0.5% of their assets invested in the precious metals sector. At the peak of the gold/silver in 1980 institutions had 5% invested in the precious metals sector. Since then that allocation has not been above 1%. Eventually a monster move is coming in silver and the mining stocks, though no one can say when it will occur.
The catalyst for the move will be large institutional and wealthy investors reallocating cash from the stock market in general into mining stocks. I believe Buffet was a harbinger of that even though he only bought a small amount of Barrick in relation to the size of Berkshire’s assets.