Weekly Update 7-Oct-2016
This was a very strong week for everything except precious metals and gold stocks. Crude oil made the biggest gains, rising 8.5%, while gold stocks saw the largest decline, falling 9.4%.
Among the currencies, Bitcoin once again rose the most, adding 6.5%. The Chinese Renminbi rose 5.5%, and even the weakest currency, the Japanese Yen, gained 2.6%. Short term treasuries rose 4.9% while long term treasury bonds gained 2.5%; neither one could match plain, old USD cash stuffed into your mattress, however: that rose 5.1%.
Major stock markets were all higher this week, led by the Nikkei, which gained 5.2%; the Dow Jones Industrials and the Euro STOXX each added 4.7%. Only gold stocks were lower, and were they ever! The HUI dropped 9.4% to close below its 200 day moving average for the first time in 8 months.
Commodities were divided into two camps: precious metals, and everything else. All of the precious metals declined, led by silver, which fell 5.9%. Crude oil continued its outstanding performance, rising 8.5% on top of last week's 9.8% gain. Copper rose 3.4%, while cotton and coffee gained 3.4% and 2.6% respectively.
I would suggest that you take advantage of these updrafts to take profits and move some of your assets to the safety of gold. I don't know how long they will last, but once the US election is complete the fed will take the safety off of its monetary machine gun, and with Italian and German "too big to fail" banks on the very brink of failing, I think this is the time to be moving calmly but forcefully towards the exits – before everyone else smells the smoke and panics.