Editor's note: The Weekend Edition is pulled from the daily Stansberry Digest. We're sharing one of those pieces with you today. Also, the markets and our offices will be closed on Monday in observance of Memorial Day. We look forward to rejoining you on Tuesday.
Back in January, I said gold's "winter" was over – really...
I added the "really" to that issue of the Stansberry Digest because gold bulls had been waiting for the price to break out higher for about two years...
Isn't gold supposed to be a "chaos hedge"? Haven't we seen enough chaos already? Isn't gold supposed to be an "inflation hedge"? Haven't we seen enough inflation already?
I think part of the frustration has been about expectations... because if you look at gold's price action, it has been doing just fine, thank you very much.
Gold spiked to more than $2,000 per ounce in the months after the onset of the COVID-19 pandemic. And it spiked again to that level when Russia invaded Ukraine in early 2022.
Even after the price pulled back during the year (when "everything was down") because of a relatively stronger dollar and higher interest rates, gold stayed even. It was only $10 lower at the end of 2022 than it was at the start.
Since gold's lows in September, October, and November, its price is up nearly 20% – 20%! And the metal has recently traded near new all-time highs again.
So, gold has seen some volatility... but all in all, it has been doing its job in a well-diversified portfolio. It rose or held its value at times when everything else was losing value. Winter is indeed over. Spring is here.
Now, our legendary Gold Stock Analyst editor John Doody – the smartest guy I know in the gold space – is saying gold may be set to do even better the rest of this year. According to John...
Gold's next long, lucrative bull run is just getting started...
John says 2023 is looking like a "perfect storm" for higher gold prices, which could spark one of the biggest gold bull markets ever... and I don't say that lightly.
For those who might not know, John is one of the most well-connected minds in the gold-mining industry. His research is read by gold-mining executives and more than 40 professional money managers at hedge funds and mutual funds... along with brokers and private asset managers all around the world.
The renowned Jim Grant, publisher of Grant's Interest Rate Observer, calls John "the gold-mining authority."
John is a former economics professor. But he ditched that relatively low-paying job decades ago. He began writing Gold Stock Analyst in 1994... printing and stapling the issues with help from a few local kids in Nantucket looking to make some money.
Since then, gold's price is up more than 400%. And readers of John's work have been treated to years of bigger gains in individual gold stocks – which offer leverage to the price of gold. John himself has also moved on to a comfortable life in Florida.
The gold system John built has delivered a cumulative audited gain of 706% since 2001... absolutely crushing the returns of major gold funds, gold itself, and even the S&P 500 Index.
Importantly, John and analyst Garrett Goggin don't just give Gold Stock Analyst subscribers the names of stocks to buy. They provide in-depth analysis of the gold industry and its top businesses. They explain why you ought to own these businesses... and warn about what risks to avoid.
Here's what they're saying now...
Get ready for the next gold rush...
Even with gold pulling back by about 5% in the past three weeks, John and Garrett believe better times are ahead for the precious metal... and for the best gold companies. These firms are set to make the most of higher prices for their businesses and shareholders. And you don't want to miss it.
The catalyst, according to John and Garrett, will be the Federal Reserve's next potential policy moves...
Fed officials are now saying they might "skip" a rate hike next month, but they're being careful not to call this a "pause." Semantics aside, the central bank is closer to the end of this rate-hike cycle than to the start of it.
And John says that's because a recession is ahead.
One indicator John is looking at is the "inverted yield curve"... specifically, the spread between 10-year Treasury bonds and the current federal-funds rate. As John wrote in the most recent issue of Gold Stock Analyst...
When short-term interest rates rise higher than long-term rates, it signals that a recession is on the horizon.
Right now, the short-term fed-funds rate is 5.25%, while the long-term 10-year Treasury rate is 3.80%, a difference of negative 1.45%.
Since 1971, the yield curve has inverted seven times. Each was followed by a recession (shaded in the above chart of the period since 2000). The current deep inversion will yield the eighth recession.
How does the Fed react to a recession? It lowers interest rates.
If a more painful recession is ahead, the likely outcome is for the Fed to cut rates to stimulate the economy.
I can't tell you exactly when that will happen. But John can certainly tell you what has historically happened with gold's price after the Fed has cut interest rates over the past two decades... It has skyrocketed.
Since 2000, the Fed starting rate cuts has brought on five gold bull markets, each with an average gain of more than 60% from start to finish.
Even better, John's Gold Stock Analyst Top 10 portfolio has soared an average of 309% during these multiyear periods. And as John wrote in his latest issue, "The sixth one is beginning now!"
The bank crisis and inflation are two major parts of the story...
John says many banks are "sick." Their portfolios are in trouble in the higher-interest-rate environment. That's what we saw with the failures of Silicon Valley Bank and others.
Any more widespread trouble could also lead the Fed to cut rates. That would raise bond prices, boost bank portfolios, and allow banks to keep lending.
Inflation coming down – but still remaining higher than many folks expected – is another variable that could help send gold's price to new highs, should the central bank start making moves to stimulate a down U.S. economy.
My colleague Dan Ferris and I recently invited John and Garrett on an episode of the Stansberry Investor Hour podcast, and they made some great points...
We spoke about today's "fake money" world... the value of gold in the ground... and how inflation and the value of the U.S. dollar have helped push the price of a scarce, desired asset like gold higher and higher over hundreds of years.
It was a refreshing conversation to have... about the real value of real things.
The ongoing debt-ceiling drama we're seeing in Washington could also be a tailwind for chaos hedges like gold. In any case, a weaker dollar and higher inflation is a recipe for higher prices... and potentially higher returns for the top gold-related companies that John and Garrett recommend.
Gold's winter is finally over. Make sure you're ready to take advantage of it...
Editor's note: John and Garrett recently came forward with the full details on why gold is critical to your success in this market. They shared the inner workings of the system that helped John beat the market... and revealed how high they think gold's price could go. They also warned viewers about the wrong way to invest in gold – and why doing so could lead to a retirement disaster. Click here to learn more.