It is an absolutely beautiful day here on the southern coast of Georgia. The high-temperature today will be about 78. There’s a light breeze and scattered clouds. A small flock of pink spoonbills just flew down Burrell Creek, a few wood storks are pulling sentry duty high up in a pine tree out on the point where the creek makes a bend.
I could tell you that I’d rather be out on the boat fishing. Sounds good, but it wouldn’t be true. A day like this? I’d drop the anchor, stretch out with my feet up and take a nap – give the fish a break…
As I write, gold is up $20 bucks an ounce or so. A 0.70% move higher, roughly in line with the move for 10-year Treasury Bonds. Which makes sense…
The U.S. economy is running hot. Debt-fueled government spending is putting wind in every economic measure’s sails.
The bond market is telling us that the Fed may have made a mistake when it cut interest by 50 basis points last month. Bonds are also signaling that there will be no cut when the Fed meets again in a couple of weeks.
Deficit binge spending is inflationary. The Fed can’t bring interest payments on debt down with rate cuts. Yellen will have to sell even more Treasury bonds to cover the twin monsters of deficit spending and subsequent interest payments. ‘Bond purchasers demand higher yields to lend money to this cash-shredding machine.
Gold acts as an umbrella to the dark economic clouds. It’s up 36% since it broke out of a 5-year consolidation back in February.
Of course, buying Mag 7 ETFs and S&P 500 index funds sounds like more fun, never mind that their gains get measured in the mid-20s over the same period. Maybe at some point, investors favor profits over fun…
The Economic Cloud’s Silver LIning
If you really want to find the silver lining to the current economic clouds, well, as Hammer has been telling you for a few months: it actually is silver. Gold may be up 0.7% today, but silver is crushing it, up 2.8%.
Again, Hammer gave you his favorite silver stock back in May…he told you why silver will outperform gold in September…and he told you yesterday that silver just broke out to a 10-year high…
If you’ve been reading Outsider Club for long, you know we have a knack for being ahead of the curve. When we tell you about particular stocks, they tend to do well…
On June 11, Hammer told you how to play interest rate cuts with mortgage company Rocket (NYSE: RKT), and real estate companies Zillow (NYSE: Z) and RedFin (NASDAQ: RFIN). Rocket ran from $14.50 to $21, Zillow from $48 to $67, and RedFin from $6.50 to $14.50.
We were recommending nuclear stocks before nuclear was cool, stocks like Vistra (NYSE: VST) ran from $79 to $139 and NuScale (NYSE: SMR) fro $5.50 to $20…
AST SpaceMobile (NASDAQ: ASTS) from $11 to $38…
Hammer’s Indian stocks from March are all up double digits, with the top gainer up 66%.
Now I’m not telling you all this to brag. The point is: we don’t just throw a bunch of random stocks at the wall and see what sticks. We pick our shots. So when we do pass on a ticker symbol for your consideration, you can bet that it’s been carefully considered…
As is the case with silver.
Hammer told you when he was buying a certain silver stock at $0.90…and yesterday he told you he wasn’t selling until it hit $2.25…
That stock is trading for $1.44 today…
Your move.
Cheers,
Briton Ryle
Chief Investment Strategist
Outsider Club
X/Twitter: https://twitter.com/BritonRyle
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