A storm is approaching, said Jeffrey Christian of CPM Group — but it won't be the total collapse of civilization that some market watchers are predicting.
Jeffrey Christian: Big Storm Approaching, Look to Gold, Silver Long Termyoutu.be
The next few months will bring a lull in gold and silver prices, but according to Jeffrey Christian, managing partner at CPM Group, that will be a buying opportunity for long-term investors.
Speaking at the Prospectors & Developers Association of Canada (PDAC) convention, he said the summer is typically slow for precious metals, although both gold and silver are likely to pick up after that point.
"Our expectation is that prices do rise beyond September, October," Christian told the Investing News Network. "Initially modestly, and then possibly stronger later." However, he reminded market participants to keep their expectations realistic and remember what purpose these assets serve in a portfolio.
"I would caution investors (not to buy gold and silver) with the expectation that gold is going to US$10,000 and silver is going to US$700, because those are unrealistic expectations," he said.
"A realistic view is (that) gold is going to go back to US$2,000, it could go back to US$2,100," Christian continued. "Ultimately we think it goes even higher over the next five years or so. But I think investors have to have a realistic understanding of what gold does for them as an investment and a realistic expectation for prices."
Christian said during a previous interview that the US Federal Reserve will be able to hike interest rates further than many people expect, and he reiterated that view during the conversation at PDAC.
In terms of the central bank's ability to curb inflation, he said that while the Fed can raise rates, it's powerless when it comes to other important parts of the equation.
"The Fed can't control the supply side (of the economy), and the Fed has no control over fiscal policy, which has been really the ... high inflationary pressure cooker over the last two years," he said.
"The Fed can staunch the bleeding during a recession with monetary policy, but it's fiscal policy that makes a stable, healthy long-term economy, and it's the fiscal policy that has been broken terribly really since the 1980s."
Don't forget to follow us @INN_Resource for real-time updates!
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.