There Is No Run Like A Gold Run… Except For A Silver Run

Palisade Radio Host, Collin Kettell: Welcome back to another episode of Palisade Radio. This is your host Collin Kettell. Returning back on the show this week is a favorite guest of our audience. It is David Morgan with David, welcome back to the show.

Author of The Morgan Report, David Morgan: Collin, it is great to be back. Thanks.

CK: Okay, thank you for that, David. Let us start off with talking about kind of a wrap up of 2015. The year certainly did not shape up positively for gold and silver investors and the gold and silver equities. It was a rough year. But maybe, just maybe, we are shaping up for good 2016. Let us leave predictions till the next question, but just give me a wrap up of what you saw happen in 2015, the macros that played into kind of what happened with the metals and also touch on the interest rate that we just had.

DM: Great! Well, we had a disappointing year as far as I am concerned. For the metal, that is another disappointing year among the last few. However, it is what it is. We started off the year last year actually, 2015, we started off the year kind of with a bang. We came out of the chute in January with a pretty decent move in the precious metals markets but it lasted a very short time and then it was basically all over.

The metals actually performed best the first half of the year, 2015, than they have the second half of the year and that applies to gold as well. But, basically, going back a couple of years lost what I call the positive psychology of the market when silver broke the $26 level and gold broke the $1550 level at the same time and on extremely high volume, definitely a takedown as far as I am personally concerned. By the way, we go through that in The Silver Manifesto where a lot of people ask about the silver manipulation. I do not have time, Collin, to go through all the ins and outs. But if you are really interested in silver manipulation you owe it to yourself to buy the book because with that knowledge— you may have to read it two or three times, or just Xerox it or copy or scan that chapter, then you would be armed with data-driven material that would definitely give you an advantage if you are on the manipulation side. We are trying to be as objective about it as you possibly can.

Back on point, we got a pretty good rally in the gold markets. It has just been kind of a big disappointment when they broke the support levels in the April 2013 timeframe and here we are couple of years later. It has just been big sideways move from that drop down where silver actually was supported around the $19 level. I called it bottom at a spike $18.17 held that for fourteen months and then it broke below that level. Since then we really had a hard time to get back over $18. We have only done it once and to go over $19 has not happened in quite some time, basically for the whole year.

Gold had similar pattern. Gold, of course, is more widely held and considered more of an established investment than silver is. Certainly a similar pattern but not percentage wise the loss that we’ve seen again on a percentage basis. Technically, it looks like it could be bottoming here both gold and silver under their respective 200-day and 50-day moving averages. I do not know if it is a bottom here, personally I have added to a silver position in the physical realm, basically below the $14 level. We are seeing a volatility coming in Collin, the volatility to a market, meaning that we are down fifty cents one day and up fifty cents the next day, down fifty cents the next day and up fifty cents the next day, that kind of volatility is very common in a market that is about to turn direction. I am not saying that it will or it is, it could be. Certainly, volatility, even it is going to trend sideways for a while, adds interest into a market because the day traders, the momentum traders, the high-frequency traders, etc. all look for volatility in any market. They are sort of agnostic, they do not care. They do not have any fundamental thoughts about gold and silver being an honest money or financial assets or safe havens or any of that stuff. They basically trade whatever is moving.

Long Winded, that was where we were, and I think you wanted to ask where we are going. I will just segue into that. first of all with of my favorite sayings, or one of them is, i no one knows the will of the market, I think that we will see a much better year in 2016. But I want to add the caveat that I just finished the silver summit late November 2015 and almost to a man all my peers and colleagues were of the opinion that we had another year in the precious metals where it is to be in these choke holds. No one gave specific prices but they all were of the idea that we would be at low levels in the metals for another year.

I have a different view. I think that we will do better this year coming up 2016 and depending on interest rates and primarily the equity market will give us impetus to see more moves in the precious metals or not. If we see the general equity market measured by the DOW, the S&P or both and they start to falter and you see some money coming out of that market with no more place to go. There are several places, of course, these days but gold is the most negatively correlatively asset to the general equity market. So if you see a fall in equity prices you can rest assured that some of that money is going to find its way in the gold market.

That is what I see happening. I think that we have this kind of two big names out there that have different thoughts we have Martin Armstrong looking for $23000 or something, the higher stock market in other words. You’ve got Harry Dent I think looking at about $5,000 or $6,000 so of the opposite view. Am I in the middle? I am more or less in the let the market tell us mode, but from all the technical indicators and sentiment, and links to the market I figure the downside more than the upside for the equity market which again favors gold. Silver, gold on steroids, Jim Sinclair has sort of monitored the silver market. Certainly it has much bigger moves up and down. I think that you are going to see silver do much better in 2016.

Now people want prices and I think they deserve to hear price levels. If you look back to what we just talked about, Collin, and say, well you know David silver, really, has not done much positively price wise from about the $19 level and it too was taken down below the $19 level somewhere around August, September 2014. If you take that into account and charts are not always symmetrical. But I have been looking at these things for like 30 years. I have been in the markets for forty years. I do not catch on the technical side till I have had about ten years in the market. There is something to these charts even manipulation shows up in the chart. I mean what I just said about that is a big selloff, it is there. You can see it. You can see the move. You can see the volume. Those are the two most important things when you look at a chart, so it cannot be disguised. In fact if I was in the courtroom, I would use the chart to show the courtroom and the jury. I would put my point with charts, but at least partially.

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