Gold Peaks: What Does the Past Tell us About the Future ?

So if I’m right yet again, what would it look like?

Well, I want to be clear that I’m not joining the prediction racket. But just for fun, we can look at what past gold bulls suggest about the potential for the new one we’re in…

Several things stand out from this chart. The big one is that the current bull really is just getting going. We’re up only 42%, starting from the $1,049.4 low on December 17, 2015.

The second one is that the most recent gold bull, from 2001 to 2011, also had a long, slow start. Being the nearest in time, it’s reasonable to see it as the most relevant example. And it started accelerating upward at just about the same point where we are now.

The third is the potential upside. If today’s bull were to resemble any of the past bulls in the chart, the gains would take gold to these new peaks:

• • 1974, 462% equivalent peak: $5,897.63

• • 1980, 721% equivalent peak: $8,615.57

•          2011, 595% equivalent peak: $7,293.33

A gold bull like the least of the ones above would take gold to $5,898 per ounce. And that’s just the metal itself.

Imagine what gold rocketing up to $8,616 would do to the best, highly leveraged gold stocks?

At this point, the standard newsletter sales pitch would be to cherry pick some of the biggest wins from past bull markets and tell you that you have to subscribe today or miss out on your chance to bag such gains.

“You could make XX,XXX% if you buy now!”

The truth, of course, is that past performance is no guarantee of future results.

Worse, no one can promise to have any of the big 20x, 50x or 100x winners among their stock picks. We can all say that our picks might contain moonshots like that, and that’s true. The word “might” makes almost any claim impossible to falsify.

I’ll just say that I’m confident that my gold and silver stocks—into which I’ve put my own hard-earned cash—have excellent potential to deliver extraordinary gains in the near term.

Heck, maybe you’re a better stock-picker than I am.

My point today is just to illustrate, conceptually—like a “scoping” study on a gold deposit—what this gold bull could deliver for us.

There’s another key takeaway from all this, one you don’t need me or any newsletter writer at all to make use of.

Look at the chart again…

Gold itself could hit it out of the ballpark for you. And silver typically outperforms gold, on a % gain basis.

In other words, we’re at a unique point in time when we can not only buy the metals as a prudent way to protect savings, we can buy them as speculations as well.

Gold and silver could yield gains on the order of a great discovery, with:

• • No exploration risk.

• • No danger of an endangered mosquito killing the deal.

• • No possibility of gold or silver going bankrupt.

• No chance gold or silver prices will drop to zero.

Could I be wrong? Of course. I do not claim to know the future.

All I claim is that the rising tide of geopolitical madness and the falling tide of economic activity is very bullish for precious metals. The metals themselves have become relatively low-risk speculations with potentially high yields.

And it’s hard for me to imagine a better speculation than one I’d buy for prudence anyway.

But, personally, I’m at a stage in my life when I’m looking to amass wealth, not just protect existing wealth. That’s why I’m looking to deploy as much of my own cash as I can into the best physical gold and silver I can find, I want to own it.

Everything I’ve learned in my years in this business tells me that these will multiply the gains I see coming in the metals themselves.

Posted by :

Jack Dempsey,  President

401 Gold Consultants LLC

( jdemp2003@gmail.com)