Yesterday, U.S. equity markets sunk on news of rising COVID cases and Washington unable to agree on a money pumping scheme to help boost the sagging economy.
And with virus cases rising in Europe and governments imposing new rounds of lockdown measures, equities were down sharply there as well.
Today, it’s more of the same in the States and overseas, with markets down as fears of sagging economic growth intensify. Indeed, with the exception of China – where the virus broke out but only 4,634 died from it, and the only major nation that will have positive GDP growth for 2020 – throughout most of the world, the “Greatest Depression”has begun.
With just a week away from Election Day, there is little expressed concern on the Street as to who wins the Presidential Reality Show. Research shows that regardless of who wins, stocks go up… but not necessarily this time, since there is growing concern of post-election violence by supporters of the losing candidate.
Oil: One of the major indicators of where the economy is headed are oil prices. With tourism tanking, remote offices, and at-home school increasing, hospitality/restaurant business badly slumping as people stay home… demand for oil is falling, as are it prices. Brent crude is stuck in the low $40 per barrel range, down some $28 from its January high.
Unless a wild card, such as wars, are played, we forecast oil prices will stay in the $40 range as the “Greatest Depression”worsens. Indeed, with the mainstream news selling 24/7 COVID Fear and nations and states imposing new lockdown rules, consumer and industrial oil consumption will continue to decline.
Gold/Silver: According to analysts, gold prices fell last week because of a stronger dollar, better-than-expected U.S. unemployment numbers, and uncertainties about a stimulus package from Congress before the election.
The dollar is not that strong, however – it fell yesterday and today, and unemployment numbers are still far above pre-lockdown levels. We maintain our forecast for rising gold and silver prices as governments continue to pump in countless trillions to artificially inflate equity markets and sharply slumping economies.
Should the Democrats win the White House and Congress, we forecast precious metals will rise faster since they will inject heavier doses of monetary methadone into the economy. Thus, the more cheap money the print, the lower the dollar goes and the higher precious metal prices rise.
Indeed, the sentiment on Wall Street is that if Biden wins, he will also escalate the COVID War. Thus, that would mean locking down more of the national economy and pushing the United States deeper into the “Greatest Depression.”
Bitcoin: As forecast, Bitcoin prices continue to rise as governments, particularly China, go digital. And, unlike older generations who view gold and silver as safe-haven assets, the going-digital trend will prove bullish for cryptocurrencies, particularly for younger generations who live in a digital world and are fearful of an economic future of worthless money.
We forecast Bitcoin will continue to rise, surpassing its all-time high. As the “Greatest Depression” worsens, more cheap money will be pumped into failing economies, thus pushing the value of currencies down… and inflation higher. The lower currencies fall and the higher inflation rises, the greater the demand for safer haven assets such as precious metals and Bitcoin.
