Supply of Gold Craters (Just As Demand Surges)


from Birch Gold Group:

This week, Your News to Know rounds up the latest top stories involving gold and the overall economy. Stories include: Physical gold is getting more difficult to come by, gold jumping to $2,000 by 2021 is a reasonable prediction, and Goldman Sachs tells investors to buy gold.

As Switzerland shuts down, gold investors are running into a safe haven supply glut

While many countries have experienced some form of shutdown in response to the coronavirus pandemic, Switzerland’s case is shaping up to be the most impactful to the gold market. When it comes to gold processing and storage, Switzerland is one of the most pivotal countries in the world.

These sectors, along with dealership, transportation and mining, have all been affected by the crisis. The situation has been worsened due to Switzerland bordering with Italy, the nation that has been hit the worst by the virus. And, according to those in the Swiss bullion industry, investors are having a hard time purchasing physical precious metals.

While Swiss Gold Safe’s high-security gold storage facilities have been doing well, the firm’s brokerage side has essentially shut down. Ludwig Karl, a board member at the company, said that bullion dealers in Switzerland have largely closed up shop due to government restrictions while related firms have minimized their brokerage activities, making it exceedingly difficult for private investors to obtain physical gold.

Although investors tend to opt for the most popular coins, such as the South African Krugerrand or the Canadian Maple Leaf, Seamus Fahy, co-founder of Merrion Vaults, said that market dynamics have shifted to a point where many buyers will contend with any physical gold they can get. The supply glut comes amid a return of buyers to the gold market, with the metal gaining around 8% last week and famous investors like Naguib Sawiris and Mark Mobius doubling down on gold and recommending that others follow suit.

Strategist: $1,800 by the end of the year and $2,000 in 2021 are moderate gold forecasts

TD Securities is the latest firm to issue a bullish gold forecast as the precious metals market sheds its losses and returns to the seven-year highs seen around the start of the year. Last week saw gold move up and down as the buying continued, with the metal nearing $1,700 during the week and hitting a high of $1,640 during Friday’s trading session.

According to Bart Melek, TD Securities’ head of global strategy, all of gold’s most powerful drivers were there before the crisis hit, and the metal is likely to continue growing exponentially as the stock market scrambles to find a way to deal with its worst losses since the 2008 financial crisis and world governments waste little time applying heaps of stimulus to their damaged economies.

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