Welcome to another installment of The Daily Cut Friday mailbag.
This is an extra-long edition, so let’s get right into it…
First up, one enthusiastic subscriber can’t wait to get started with Teeka Tiwari’s newest investment advisory – Palm Beach Venture…
Reader question: Loved the Freedom 2020 video. I want to invest in the pre-IPO deal – how do I do that?
Thank you!
– Shelly D. (Legacy Research member)
Paid-up subscribers to Palm Beach Venture can access investing instructions right here.
And for anyone who missed Teeka’s Freedom 2020 presentation last week, you’re in luck… Even though we removed the replay three days ago, I convinced our publishers to give you and your fellow readers another chance to watch.
You can catch Teeka’s Freedom 2020 video right here… but only for a few more days. After that, the window to invest in this pre-IPO deal will be gone forever.
Next up in the mailbag… a reader of Tom Dyson’s Postcards From the Fringe wants to know more about gold.
We managed to pin Tom down for an answer as he traveled from London to Baltimore. And, as an added bonus, we got gold experts Dave Forest and E.B. Tucker to chime in, too…
Reader question: Hi guys! Is it too late to buy gold right now? I keep waiting for it to go down before buying it, but it doesn’t seem to go that direction. Thanks for your input! I love reading your Postcards From the Fringe.
– Lisa O. (Legacy Research member)
Tom’s answer: So is it too late to buy gold?
No, absolutely not. In fact, the move has hardly started. First, gold must pass $1,911, its all-time high set in 2011. That’s still $350 or so higher than where we are now. Almost everything these days is trading at all-time highs. Gold is one of the few assets that isn’t at all-time highs yet. It’s only a matter of time. Probably quite soon, I’d guess. But that’s the first “base.” And it should be a big comfort to anyone who hasn’t bought gold yet to know you’re still buying gold far below what people were paying for it eight years ago.
But the real fun begins when the panic into gold begins. When the dollar starts losing value and the Fed’s balance sheet starts degrading. When people get scared their bonds will be reduced by inflation. That’s when gold becomes the most attractive, most urgent asset to own in the markets. That’s when it goes to $10,000.
I don’t want to go into the arguments for gold now. Just that we’re still a long way to go. Stop trying to “time” the market. You can’t. So just buy now. Because it probably won’t go down much further.
Here’s another way to think about it…
I am not buying gold per se. I’m a long-term stock market investor. But I overlay my long-term stock investments with a simple timing tool that kicks me out of stocks when stocks get too expensive. And when stocks get cheap again, I get back in. The thing is – and the data is very clear about this – this timing tool only works if you go to gold, not cash, when you’re on the sidelines. Right now is one of those times to be on the sidelines in gold and out of stocks.
If it’s any consolation, the Dow-to-Gold ratio – what I use to monitor the progress of my decision to leave stocks and sit on the sidelines in gold – is still more or less where it was when I bought gold a year ago (November 2018). So you’re getting into my trade at the same level I did.
Dave’s answer: Definitely not too late!
Consider that gold hasn’t even reached the high of $1,900+ it hit in 2011… and we’ve printed $10 trillion more in the U.S. alone since then. Inflation is a pretty basic principle, and it suggests gold is going much higher from here.
E.B.’s answer: The chart is moving lower left to upper right. It doesn’t usually back up to pick up passengers who missed the train. Go to the next station and get on.
That’s investor-speak for, “No, it’s likely not too late to buy gold right now.”
Consider that most gold bull markets are multiyear events. Take November 2008, for instance. I bought gold for around $720/oz. Over the ensuing 34 months, it rallied to an all-time high of $1,900.
However, just four months after I bought gold for $720/oz, it traded for $920/oz, which is a 28% increase over my purchase price. Would I have been foolish to pay up for gold then? No, quite the opposite; buying at the higher price would have been wise, in retrospect. Gold kept making new highs, leaving the cheapskates behind.
Point being, if we’re in a new gold bull market, as I have publicly stated… and gold moves to surpass its 2011 high of $1,900 this year (which I predict it will)… today’s price of $1,550 looks like a bargain.
Let’s continue looking ahead with our next question…
After reading a recent issue of Bill Bonner’s Diary, a concerned reader hopes for some good guidance from Legacy cofounder (and chief satirist) Bill Bonner…
Reader question: Bill, I agree 100% with your views. I do not believe we can stop this juggernaut [the economy’s crumbling below the surface] – the miscreants are too well-entrenched. What should we do now? How should we prepare ourselves?
– Reg M. (Legacy Research member)
Bill’s answer: The world economy seems to be slipping into a slow, sluggish, and slumpy pattern.
Who knows what will happen? But when we come out on the other side, we predict that gold will be as shiny as it was when we went in. Maybe shinier.
Our advice remains the same: Hold some gold. Hold some cash. Hold some bricks and mortar. Hold some equity in solid businesses. Call your mother… pet your dog… and be happy.
Last up for today, Jeff Brown answers a critical question about this year’s presidential election in the U.S…
Reader question: You mentioned only a few large corporations controlling quantum computers at the moment – Google being one of them, and I’m guessing other left-leaning Silicon Valley-ites. Therefore, what do you think of a breach of the 2020 election taking place as the left’s last chance to eliminate Trump? As the impeachment garbage circles the drain and other desperate attempts fail, this is my prediction for 2020.
– Gary S. (Legacy Research member)
Jeff’s answer: Thanks for writing in, Gary.
Just to catch new readers up, the other week, I predicted that 2020 would be the year we see the first 256-qubit quantum computer.
This will be a large jump up from the 53-qubit quantum computer at Google that achieved quantum supremacy.
This next jump in quantum-computing power is significant because a 256-qubit quantum computer could crack so-called military-grade encryption in a matter of seconds. It could cause panic for corporations and governments that need to secure sensitive information.
But I’m not too worried that this technology will be used to interfere in the 2020 elections. These are still early days for quantum computing, and the usage of these systems is tightly controlled and monitored.
Equally important, they can be used only for a limited set of problem-solving. In future years, we’ll be able to apply the technology to much broader use cases.
Yes, Google, Facebook, and other outlets will continue to covertly attempt to influence election outcomes, precisely as they have been doing for so many years.
It is, however, getting more difficult to do so, as leaks of these manipulating tactics have become well-known. And politicians and regulators have placed these companies in a very difficult position.
The larger risk of election interference will likely again come from countries like Russia and China. These countries are looking for a weaker, more pliable U.S. president with regard to trade negotiations and foreign handouts.
The importance of being able to verify information sources and having ways to validate and confirm information has become more critical than ever before. And this is a problem that the latest technology is well-suited to solve.
While there will certainly be a lot of fake news again in 2020, I am optimistic that it will be more difficult to influence outcomes with false information compared to 2016. The U.S. understands the extent of what happened in 2016 and is much better prepared to deal with this issue in 2020.
Jeff is hosting a very special event next Wednesday, January 22, at 8 p.m. ET. He’s revealing a project he’s been quietly working on for the past five years. It’s a system designed to pinpoint small tech stocks before they climb hundreds of percent in days… or even hours.
It all comes down to a government process that impacts a select group of what Jeff calls “timed stocks.” And, as a Daily Cut reader, you can sneak a peek right now.
Just go here for a quick preview. If you like what you see, do yourself a favor and sign up to attend Jeff’s presentation next Wednesday. You’ll be glad you did.
That’s all for today.
Have a nice weekend.
Regards,
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James Wells
Director