Gold’s Bullish Fundamentals

by Craig Hemke
Sprott Money

Over the past few weeks, we’ve tried often to remind you that the year 2020 is unfolding almost identically to the year 2019…at least in terms of COMEX precious metal prices. COMEX gold fell from early September to late December last year and then resumed its uptrend as the fundamental factors that had been driving price began to reassert themselves. The same thing is happening now.

If you need a refresher, here are two recent links on this topic:

Time for a Turn
2020 Is 82% Finished

And what are those “fundamental factors that have been driving price” for the past two years? Here are just a few…

Let’s start with negative interest rates. You likely know how negative “real” rates are a key long-term correlation for gold prices. However, straight up negative nominal rates are the single most bullish factor ever created by man. Why? Because while it takes some additional thought and understanding to grasp the importance of inflation-adjusted interest rates, just about anyone can look at a -1.0% sovereign bond or bank rate and think that there must be a better deal out there somewhere. “Gold doesn’t pay a dividend” sure beats the heck out of “negative interest”.

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