Adam Hamilton: Gold, Silver, and Stock Bears
The latest essay by Adam Hamilton of Zeal LLC - Gold, Silver, and Stock Bears -tries to answer the question: will precious metals and PM stocks be a good place to park capital if the general stock markets are entering a bear?
He looks at the 1973-1974 US bear market as a parallel to what might happen in 2007-2008:
Gold: Gold soared in a majestic and powerful bull market and more than tripled while the general stocks swooned. Gold can fall with stocks from time to time, no doubt. But if the metal’s underlying global supply and demand fundamentals remain bullish it will rise on balance regardless of whether the general stock markets are rising, falling, or trading sideways.
Silver: With a vastly smaller market than gold’s, silver is much more volatile and moves much more rapidly . . . silver is a speculator’s metal, and it tends to explode vertically from time to time when speculators flock to it.
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