In the latest episode of Live from the Vault, industry experts gathered to unpack the critical role of precious metals in today’s volatile economic environment. Featuring insights from Andrew Maguire, Andy Schectman, Craig Hemke, and Rob Kientz, this episode dives into the strategies, challenges, and trends shaping the gold and silver markets.
The power of precious metals
Precious metals have long been a safeguard against economic volatility. Central banks worldwide are increasingly shifting their focus to gold as a high-quality liquid asset, driven by Basel III regulations. Strategic accumulation of gold—particularly by countries like China and Saudi Arabia—underscores a clear move away from the US dollar and treasuries. This shift reflects a growing reliance on tangible assets amidst a climate of geopolitical and economic uncertainty.
Meanwhile, gold’s reclassification as a tier-one asset by the Bank for International Settlements (BIS) has further cemented its appeal. For individuals, today’s undervalued gold and silver prices present a prime opportunity to begin stacking metals, building a hedge against fiat currency depreciation.
Wholesale vs retail market dynamics
A striking dichotomy exists between robust wholesale demand and subdued retail activity in the precious metals market. While central banks accumulate gold at record levels, retail investors are distracted by speculative investments like cryptocurrencies and tech stocks. Andy Schectman, president of Miles Franklin, highlights this trend, emphasising the disparity between institutional and individual behaviour.
However, retail investors face mounting financial pressure, with some forced to sell small amounts of gold and silver to meet everyday obligations. This economic strain, as outlined by Rob Kientz, underscores the importance of educating individuals on the long-term value of holding physical assets.
Eastward shift in market power
The dominance of Western exchanges, such as COMEX, is being challenged by Eastern markets like the Shanghai Metals and Futures Exchange. Experts predict a transition in pricing power from West to East, driven by Shanghai’s commitment to physical-backed trades. In contrast to COMEX’s heavily rehypothecated system, Shanghai’s transparent 1:1 ownership model builds trust and credibility.
This shift signals a broader realignment in global financial power, with emerging markets leveraging Western systems against themselves. As Craig Hemke and others suggest, this methodical exploitation of vulnerabilities may lead to a sudden and irreversible systemic shift.
As economic pressures mount, the window of opportunity for securing precious metals at favourable prices narrows. The decline of fiat currencies, coupled with rising trust in physical assets, demands urgent action from both institutional and retail investors. Whether through strategic gold accumulation or rebalancing portfolios towards tangible assets, safeguarding wealth in the current economic climate seems no longer optional—it’s essential.
This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.
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