Biden backs Powell – good for gold

Now it’s out, US President Joe Biden wants to keep Jerome Powell as US Federal Reserve chairman. Biden knows what he has in Powell. If there are economic difficulties, he will stand by the US with the most powerful central bank in the world. Sufficient liquidity for the next crisis thus seems assured. The fact that the gold price has not reacted positively, but has now even gone into reverse, is due to the alternative. For Biden could also have chosen Lael Brainard. The economist is said to be a, so far secret, follower of Modern Monetary Theory (MMT). Whether or not this is true, as Fed chief she should surely have disclosed it. In any case, Brainard is a "super dove", so she is quick to inject money into strained markets.

Thus, for the gold market, Powell is indeed only the second-best solution. But he is not a bad solution for gold fans. Because as I said, it remains guaranteed that fresh money will always be thrown onto the market when necessary. This will also prevent the inflation rate in the US from going down significantly any time soon. Real interest rates will thus also remain low or negative, making the opportunity cost of holding gold negligible. This could, indeed should, attract ever wider circles of institutional and private investors. If an upward trend in gold then sets in again – winter historically offers good months for gold anyway – then more and more investors will also be looking to gold mining stocks. Those who are on this train in time could then profit with leverage on the gold price.

From today’s perspective, interesting investment opportunities in the gold sector are Gold Terra Resource and Victoria Gold.

Gold Terra Resource – https://www.youtube.com/watch?v=IS2lp-5mpBw – owns one of the largest gold properties in Canada, the Yellowknife City Gold Project in the Northwest Territories, which has just been expanded.

Victoria Gold – https://www.youtube.com/watch?v=oLZm4d0y-M4 – is producing at its Eagle Gold Mine in the Yukon (almost 56,000 ounces of gold in the last quarter), this is part of the Dublin Gulch property.

Current corporate information and press releases from Gold Terra Resource (- https://www.resource-capital.ch/en/companies/gold-terra-resource-corp/ -) and Victoria Gold (- https://www.resource-capital.ch/en/companies/victoria-gold-corp/ -).

In accordance with §34 WpHG I would like to point out that partners, authors and employees may hold shares in the respective companies addressed and thus a possible conflict of interest exists. No guarantee for the translation into English. Only the German version of this news is valid.

Disclaimer: The information provided does not represent any form of recommendation or advice. Express reference is made to the risks in securities trading. No liability can be accepted for any damage arising from the use of this blog. I would like to point out that shares and especially warrant investments are always associated with risk. The total loss of the invested capital cannot be excluded. All information and sources are carefully researched. However, no guarantee is given for the correctness of all contents. Despite the greatest care, I expressly reserve the right to make errors, especially with regard to figures and prices. The information contained herein is taken from sources believed to be reliable, but in no way claims to be accurate or complete. Due to court decisions, the contents of linked external sites are also co-responsible (e.g. Landgericht Hamburg, in the decision of 12.05.1998 – 312 O 85/98), as long as there is no explicit dissociation from them. Despite careful control of the content, I do not assume liability for the content of linked external pages. The respective operators are exclusively responsible for their content. The disclaimer of Swiss Resource Capital AG also applies: https://www.resource-capital.ch/en/disclaimer/