Top Stories This Week: Last Pre-Election Gold Calls, Nowhere to Go But Up?

Precious Metals

Catch up and get informed with this week’s content highlights from Charlotte McLeod, our editorial director.

Gold has remained relatively rangebound over the last month or so, not moving more than about US$20 above or below US$1,900 per ounce.

This week was a different story, however, with the yellow metal dropping as low as US$1,860 or so.

The downward momentum for gold has been attributed to a variety of factors, including a lack of demand as investors stay on the sidelines ahead of the US presidential election.

The election is of course top of mind for market watchers, but as we’ve discussed previously there does seem to be a consensus that the result doesn’t really matter for the gold price.

I spoke with Gerardo Del Real of Digest Publishing, who explained that whether it’s a Donald Trump victory or a Joe Biden win, there’s likely to be more stimulus, which would be bullish for gold.

“Regardless of who wins (the US election) … the one thing you can probably count on is stimulus. More counterfeiting of the currency” — Gerardo Del Real, Digest Publishing

Will Rhind of GraniteShares echoed that sentiment in a separate conversation, saying that historically neither the Democrats nor the Republicans have been aligned with a higher gold price — instead it’s more about the individual president. Like Gerardo, Will sees more stimulus ahead, and thinks gold will benefit as the debt load in the US inevitably rises higher.

“I think it boils down more to the actual president themselves. But certainly in this day and age, we’ve been taking on more and more debt from a government perspective … I think it just keeps getting worse from a debt perspective, which ultimately favors gold” — Will Rhind, GraniteShares

Our Twitter polls have focused a lot on the US election lately, but this week’s question may be our last on the topic. With so many predictions of the volatility this event could bring, we asked our followers if they feel secure with how their portfolios are set up right now.

By the time the poll closed, about 60 percent of respondents said they feel secure, while the remainder said they do not. One person commented that they have a long-term focus and aren’t bothered.

We’ll be asking another question on Twitter next week, so make sure to follow us @INN_Resource or follow me @Charlotte_McL to share your thoughts.

In the cannabis space this week, INN’s Bryan Mc Govern spoke with a special purpose acquisition company (SPAC) with plans to start operating as a real estate investment trust (REIT).

A SPAC is a company that raises money from investors, then finds an acquisition target and finally completes a qualifying transaction to start operating. The transaction must be completed within very specific parameters determined by the company, otherwise the capital goes back to the investors.

SPACs have become popular in the cannabis space this year partially because they offer a straightforward way to go public. The REIT model is also popular, but it’s only made a few appearances in the cannabis space. Put simply, it involves operating a network of income-generating properties.

Subversive Real Estate Acquisition REIT LP (NEO:SVX.U,OTC Pink:SBVRF) is the first to use the SPAC model to become a REIT in the marijuana industry, and it plans to target the recreational market. Even so, according to CEO Richard Acosta, the company’s focus will be real estate first, cannabis second.

If REIT LP’s qualifying transaction goes through, it will begin operating as a REIT with 15 properties in California, Florida, Nevada, Arizona, Maryland, Michigan, Ohio, Pennsylvania and Washington.

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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

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