The superpower any investor would pay a fortune for would be the ability to predict people’s emotions.
Investor sentiment is a funny thing. As sophisticated as the capital markets are, with the plethora of institutional analysis and research, algorithmic trading technology, and perpetual financial innovation, human emotions are still the most powerful driving force behind valuations.
One of the most influential emotions on asset prices is uncertainty, which is the precursor to fear. People don’t buy equities when they’re unsure what to expect next quarter, and certainly not when there is the potential for several Black Swan events.
The threats of war, debt and currency crises are increasing worldwide, creating general uncertainty among investors. I certainly feel it.
Investors Have An Allocation Question
What is investors' biggest question in this time of sticky inflation and geopolitical uncertainty? Where to put their excess capital...
The answer for the last fourteen years was stocks… not so anymore.
This has led to an epic rally in gold and silver prices while the sheen of equities has worn off. What’s particularly interesting about this rally in gold and silver is its broad participation — from central banks purchasing record amounts of gold in the last 24 months to retail investors buying an estimated $200 million worth of gold per month from Costco!
You see things like that, and the world is clearly losing faith in fiat (and ‘the system’).
A Chat With Dr. Kirk Elliott
Given the macro environment, I invited Dr. Kirk Elliott to the pod. He is the founder of one of North America’s largest silver bullion dealers, Kirk Elliot Precious Metals, based in Denver, Colorado. He has two Ph.Ds, one in finance and public policy and another in theology.
Elliott’s firm deals bullion to thousands of clients, and he’s dialled into the sector and overall investor sentiment toward precious metals. With his extensive knowledge and experience in finance, public policy, and theology, he provides unique insights into the factors influencing investor sentiment and the enduring appeal of precious metals as a hedge against inflation and uncertainty.
From the potential for central bank digital currencies, which are digital forms of fiat money issued by the central bank, to the waning supremacy of the U.S. dollar, our conversation covers a spectrum of topics impacting the capital markets and demand for precious metals.
We also explore the nuances of investor sentiment in today's volatile landscape. After watching the pod, I think you’ll agree that the forces driving gold and silver prices aren't a passing fad but rather the formation of a long-term trend.
Hope you enjoy it,
Aaron
