As we’ve discussed in this blog since the beginning of the new administration, the first hundred days set the tone for the term. With approval ratings nearing historic lows the administration’s ability to deliver on campaign promises appears to be growing weaker every day. Confusion and uncertainty are the hallmarks of bear market and they appear to be the only thing this administration has been able to deliver with any regularity. The market didn’t handle the healthcare failure well and is desperately looking for any kind of “win.”
Some of the hallmarks that exist prior to stock market collapses of the past include; extremely low interest rates, trading levels well above where they should be, and a sluggish economy. In case you hadn’t noticed, we’ve had all three of these factors in place and in excess for quite some time now. Many “advisors” suggest not trying to predict the market, rather to wait for “clear” indications of an end to the bull market. The problem with that is that large funds and investors trade in nanoseconds. The chances of a “little guy” getting out of the way of a financial tsunami are solidly placed between slim and none. And make no mistake about it. The next downturn isn’t going to be gradual.
The only thing keeping the market up at this point is the withering hope that tax breaks and infrastructure spending are going to magically stimulate an otherwise catatonic economy. And the failure of the President’s healthcare legislation has only empowered the opposition to fight his proposals even harder. Even “the wall” has lost tremendous support among Trump voters. If you are hell-bent on riding this bull market to the end, then at the very least, increase your physical precious metals ownership to an aggressive level, so that you can withstand a potentially devastating stock or currency collapse.
The 5% – 15% of physical precious metals ownership for portfolio holdings suggested by most financial advisors is simply not enough protection in today’s shark-infested economy. The greater your exposure in the stock market, the greater a percentage you need invested in physical precious metals. That holds true for your investment portfolio, as well as your retirement portfolio. Like I said, large investors and huge hedge funds affect the market immediately. They buy and sell, immediately. Small investors are simply left out when the panic button is pushed. There’s no way to change that part of the game, but physical precious metals are solid protection. Don’t miss that opportunity too. Today’s low prices are just a bonus.