Financial Analysis – Week 47, 2020

Nov 24, 2020

Market Overview

 

financial-analysis-week-47-2020

Politics

There is still great uncertainty. Trump or Biden? It is evident that there were major thefts and irregularities in the elections.

The head of the mafia in Philadelphia, Skinny Joey, admitted that he received 3 million dollars to insert 300,000 fake ballots. Is it true or is it a lie? The atmosphere of tension is growing.

The G20 summit is being held online.

The discussion becomes ludicrous. As if nothing is happening. No one is talking about rising debts.

They are finally starting to announce the size of the global debt.

They claim that global debts have grown to 277,000 billion dollars. They finally moved from the deadlock, when they were persistently hiding the debt amounts.

Published debts are not correct. My estimate is that global debts have risen to 650,000 billion dollars, while 3 million billion worth of securities are traded on inflated stock exchanges.

Stockbrokers are waiting for $ 2,000 billion to be put into the financial system.

The EU plans to inject 1,800 billion euros, but Poland and Hungary have rebelled, which do not accept the super state of the EU and demand national sovereignty.

 

Stock market

The indexes are still too high. The Dow Jones is at 29,595, the DAX at 13,167 and the S&P 500 at 3,579.

The stock exchange is waiting for December 14, 2020 to see when the state commission will declare the president of the USA.

Speculations on the stock exchanges lead to a daily sharp fall and rise in raw material prices, and I expect such oscillations for another three months, until large amounts of counterfeit money are pumped as a package of aid to the economy and banks.

 

USA

Millions of Americans are escaping from large cities to suburban areas because it is the only way to survive the coming economic collapse.

It is officially stated that 300,000 people left New York City, but that number is much higher, amounts up to one million people.

That is why there was a 14-year record of sale of houses in October.

The average house price climbed to $ 316,000, which is 16% higher than last year.

 

Eurozone

The consumer confidence index in the eurozone fell from -15.5 points to -17.6 points in November.

In Italy, industrial orders fell 6.1%, while industrial production fell 3.2%.

 

United Kingdom

Retail sales have risen 1.2% since October, but now we are facing new lockdowns.

 

Russia

GDP has fallen by 4.7% since October.

The unemployment rate remained unchanged at 6.3%.

Real wages have risen since September +2.2%.

Gold reserves were unchanged on October 31, 2020 – 73.9 million ounces.

Foreign exchange reserves amount to 582.84 billion dollars, which is 524 million dollars less than last month.

 

Singapore

After falling in the second quarter of K2 by -13.3%, the decline in the third quarter of K3 was 5.8%.

 

China

Gold reserves in October amounted to 1,948t.

 

Italy

The new budget envisions an increase in state spending by 40 billion euros. A tax cut is being prepared for all citizens with earnings less than 40,000 euros a year and tax breaks for southern Italy.

Debts rose from 133% of GDP in 2019 to 158% of GDP this year.

Statistics say that 5 million people in Italy are starving, while 7 million people barely make for living.

It is predicted that 60% of employees will lose their jobs in the new closures.

 

IMF and World Bank

At the meeting in October 2020, it is announced that introduction of a new international and financial system is necessary, being tied to the gold.

 

Crypto dollar

According to the Banking Law, which was adopted on March 23, 2020, FED member banks must prepare from January 1, 2021 to offer their clients digital accounts of the Central Bank.

This is the first step towards the introduction of the crypto dollar, which could, for a while, delay the collapse of the dollar.

I note that China has already introduced crypto yuan under the control of the Central Bank of China.

 

Crypto Russian ruble

The governor of the Central Bank of Russia indicates to the possibility of introducing crypto rubles, which will be tied to gold.

 

Gold

Speculators deliberately lowered the price of gold, and today gold fell to $ 1,839.

One should remain completely patient and wait for the outcome of the US presidential elections.

I expect an increased growth in the price of gold from February 2021.

I explained that investing in gold is for five years in order to protect personal property.

 

What are the predictions?

Jim Sinclair, an experienced expert on precious metals and financial markets, says:

“Just take the amount of gold that the Americans say is in their possession, and then take the debt that they have accumulated for so many years and you have to ask yourself – what is the price to reduce that debt to zero?” The lowest price is $ 50,000 per ounce. The real price is pretty close to $ 87,500 an ounce.”

Is this possible?

Sinclair toppled all my predictions.

Time will tell if he was right.

Closer to my estimates, which I presented back in 2011, claiming that gold is worth $ 15,000 per ounce, is Egon von Greyerz, who claims that gold will rise to $ 18,160 per ounce in a few years.

What should real investors do?

Withdraw fiat money from banks, buy investment gold and wait!

The most important thing is – patience.

 

 

Branko Dragaš

Investment banker

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