Your fellow readers wanted more insight after E.B. Tucker – editor of Strategic Investor – laid out the bull case for gold in last Friday’s mailbag.
So we went back to E.B. for a follow-up. Here’s what he had to say…
E.B.’s answer: Last week, I showed your Daily Cut readers why gold is due for a big rally. That got me thinking about just how big this rally could be. So I sat down with my right-hand man, John Pangere, and crunched some numbers.
What we found surprised even us. Our calculations suggest this next boom is likely to be the biggest yet.
In fact, I think this next rally will see gold hitting its previous all-time high of $1,900 – and beyond.
But we’re not calling for that next year. Next year, I believe the price of gold will hit $1,500 an ounce. That’s a 22% increase. And it will make gold stocks one of the best-performing markets in a very volatile year for equities.
As I said last week, the best way to play the setup in gold today is by owning physical gold. It has limited downside and big upside from here. Not only that, it has also survived every major financial crisis in history. This makes it the ultimate safe-haven asset.
We also recommend buying gold stocks for even more upside.
What most people don’t realize is that gold stocks are leveraged to the price of gold. This means when gold moves an inch, this sector can move a mile.
Just remember Doug Casey’s motto: Investors risk 100% of their money in the hopes of receiving a 10% gain while speculators risk 10% in anticipation of earning 100%.
These rallies are infrequent and large enough that a small, appropriately sized position will be more than enough to take advantage of gold’s next big move up.
Moving on, yesterday’s essay about the rise of electric vehicles and self-driving cars (catch up here if you missed it) got one reader questioning when it could all realistically happen.
With a guy like Jeff Brown – our Silicon Valley insider and editor of The Near Future Report – on hand… we knew just who to turn to for answers.
Reader question: How long before the general public will come to accept a truly driverless vehicle?
I foresee a period when an attendant (read: “driver”) will be required – somewhat as a man on foot carrying a flag used to be required in front of a horseless carriage in some jurisdictions some time ago.
Also, how long will it take for the public to accept the idea that an 80,000-pound tractor-trailer can safely cruise the public highways without any sort of attendant? I am guessing that it will be at least a generation.
– Charles R. (Legacy Research member)
Jeff’s answer: You might think that self-driving cars won’t be here until far off into the future. I wouldn’t blame you, either.
A Wall Street Journal article I read recently quoted a professor from Duke University who stated, “We’re a good 15 to 20 years out from [self-driving cars].”
I’ve also heard similar comments at industry conferences that I’ve attended from executives who work for the “old school” automotive companies.
But you might be surprised to hear that the technology is actually available today, in production, and being used by tens of thousands of people.
Around where I used to live, in Silicon Valley, I typically saw one or two of these vehicles driving around every single day. Yes, cars without a driver in the front seat. Every day.
These vehicles are produced by Waymo, the self-driving car subsidiary of Alphabet (the parent company of Google). They are used to shuttle around employees from location to location. There is no driver at all. Just room for two or three people to sit in the back of the car.
And just days ago, Waymo launched a new self-driving taxi service available to residents of Chandler, Arizona. It is just like an Uber service, but with self-driving cars that operate within an 80- to 100-square mile area.
And Waymo is not alone.
Three years ago, a tiny startup in Southern California started the first scheduled ridesharing service exclusively using cars that were almost fully self-driving.
The company is called Tesloop. It shuttled passengers to their destinations in Tesla cars that utilized an “autopilot” function. And 90% of the miles were driven without the driver ever touching the steering wheel.
Tesloop vehicles drove about 17,000 miles each per month. The company generated $17,000 of revenue per car per month. That’s a dollar a mile.
And just this March, a semi-truck drove unmanned on a public road. The vehicle was powered by startup Starsky Robotics which has developed self-driving technology for semi-trucks to support the logistics and freight industry.
Even more exciting is Tesla, which has the most widely deployed self-driving technology – “Autopilot.” Autopilot has been installed in Teslas for years now, and more than 1.7 billion miles (that’s not a typo) have been driven by Tesla’s self-driving artificial intelligence (AI) without drivers touching the wheel.
It won’t be long before Tesla launches its fully autonomous driving software through a simple software update to its cars, much like we upgrade the software on our computers or smartphones.
Last, but not least… as I write this, the U.S. Congress is working on self-driving vehicle legislation.
This is such an exciting time. Every month that passes brings major improvements in autonomous technology, more data, and more proof that the technology is already several times safer than human drivers.
Fully self-driving cars are on the verge of mass adoption. Not 10 years from now – right now.
Before we move on to our next topic, a quick heads up… As we told you yesterday, Legacy Research co-founder Doug Casey calls the electric and self-driving vehicle revolution “a gigantic economic earthquake” because it’s going to turn the world on its head.
In Monday’s Daily Cut, we’ll dig deeper into the second- and third-order effects that Doug says most people have no clue about. So make sure you don’t miss it.
Now, over at Bill Bonner’s Diary, our other Legacy co-founder ignited a firestorm last Wednesday…
It all started with Bill’s essay, “Should You Worry About Global Warming?” And the debate is still going strong in the Diary mailbag. (I urge you to check it out if you haven’t yet; it’s highly entertaining.)
We won’t get into the particulars of the controversy here, but there was one question that prompted a response from our favorite geologist – and editor of International Speculator – Dave Forest.
Reader question: I enjoyed your comments on global warming/climate change. Another question that probably needs to be asked: Has the Earth ever warmed or cooled in the past? If so, what caused it to do so?
– Gary L.
Dave’s answer: Most definitely… There are numerous periods of warming and cooling known throughout geologic and even recent history.
Such changes are often related to geologic events, such as the Crater Lake mega-volcanic eruption in Oregon about 7,000 years ago. This caused ensuing cooling, which is evident in archeological data from places like Nevada (people moved to new homes as their food sources changed).
Some shifts happen for less apparent reasons, like the “Little Ice Age” – a period of global cooling from about 1300 to 1870. No one quite knows why the planet got colder during this period, with theories ranging from changes in solar radiation to a slight shift in the tilt of the Earth.
So the short answer to your question is, yes. The Earth has warmed and cooled countless times in the past… from “Icehouse Earth” to “Greenhouse Earth” and everything in between.
That’s all we’ve got time for this week.
Have a good weekend… We’ll see you Monday.
Regards,
 |
James Wells
Director