People say, “Be careful what you wish for—you may get it.” I can’t say I wished for gold and silver to drop hard this week for no good reason, but that’s what just happened. I did, however, say that if we got such a correction, I’d see it as a buying opportunity.
So I just placed an order with my broker to double down on one of my favorite silver plays. With gold and silver stocks dropping like rocks, I bid under market. As luck would have it, prices started turning up again just as I was doing so, and I haven’t been filled yet.
And that’s okay.
I already own a first stake in this company. I won’t chase it to average down. The market can come to me, or I can look for something else—perhaps something a little more volatile.
But make no mistake, if the sell-off in gold and silver continues this week—which indeed it could—my order may yet get filled.
How do I know precious metals will head back north again soon, with gusto?
No one knows what the price of any asset will do at any given time, no matter how sure they sound talking about it on TV. They just sound confident because that’s part of their sales pitch. It looks great when they’re later shown to be right, and they can claim some sort of special guru power… while hoping people won’t notice or remember when they’re wrong.
Me, I’d rather stick with what I do know. And I know that none of the forces that propelled gold over $1,500 have changed.
But what caused the correction?
Well, some folks say it’s an event in the Chinese gold market. Others say it’s the commercial banks making quarter-end adjustments. There are lots of clever and persuasive theories. I simply note that the US dollar was up sharply today.
But Mr. Market is not one person, with one mind. It could well be all of the above combining into one really bad day for gold.
With the fundamentals unchanged—or more bullish than ever, if we look around the world today—there is something else I’m sure of: this correction is an opportunity worth taking.
That’s why I took action today, putting my money where my keyboard is.
And as I wrote in the alert I just sent out on this subject to clients of The Independent Speculator, I have a shopping list right here. I’m keen to deploy more cash, should I be so lucky as to get that chance.
That’s my take.
Monday, September 30, 6:36pm, EDT, 2019