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Market Report 31st August 2020
8/31/2020 10:35:22 AM



Market Report 31st August 2020

Signs that the share markets are waking up to what is happening in the global markets with the FTSE100 down from 6818 a month ago to close on Friday at 5963.57.  The Dow Jones still continues to ignore the market data and climbs up to 28653.87

There is growing concern about the increased debt levels for governments worldwide who have used quantitative easing to pump liquidity into the market to the tune of trillions and the debt/GDP ratio has exploded.  There is in the short-term likely to be big tax hikes but another train of thought is the amount of gold reserves being accumulated by central banks which could be used to counter balance the debt.  This is being mooted by the EU and other countries keen to get back to a gold standard.  This would revalue currencies against gold to offset asset/liability ratio on balance books.  Gold investors are quite excited at this prospect as gold will likely go up considerably.  The third angle countries are looking at is inflation.  Inflation is a tool which will make the debt level appear less but will short term affect billions of people’s buying ability.  If anything we could see a combination of all three tactics used.

In the UK the Chancellor is expected to hike tax rates with a proposal that corporation tax will go up from 19% to 24% hitting an already beleaguered market and likely hindering an recovery chances in the short term.  Owners of second homes are also likely to see their capital gains tax rise from 28% to 40% or 45% hitting the buy-to-let and property investment market.

Grant funds are diminishing as small and medium sized enterprises are increasingly being turned away.



Commodities

Gold – lost value during the week as the volatilitiy in the market continues.  Gold was down 0.79% for the week.

Silver – went against to downward trend for the week gaining 3.59% as industries start to go back to work and the silver shortage supply kicks in.  Silver is a by-product of mining and with many mines shut down there are no new silver supplies for the markets.

Gold:Silver Ratio – stands at 71.64 indicating silver is still the best value investment at this stage.

Copper – Panic buying due to falling supplies globally has seen a big increase in the copper price which is up 52% since the mega drop triggered by the pandemic and is up 8% overall for 2020.  With prices standing at $6605 a tonne.

Oil – the oil price collapse and deferred drilling campaigns have led to a shortage of drilling rigs for the North Sea covering UK and Norway.  With drilling rigs taking a long time to get up and running companies are only considering long-term contracts of a year or more taking exploration off the market for the time being and also affecting small companies who rely on short-term contracts to operate.

Alternative Energy - Are Electric Ships Sci-Fi or a Reality?  Irina Slav reports on the challenges ships are struggling with to convert to electric energy. To put this into perspective the average size of an Electric Vehicle battery is 67 kWh; An electric bus in China has a battery of 210 kWh in Denmark a ship is powered by 4300 kWh battery giving it 22 miles travelling before recharging is needed.  There is an electric container ship operating between Chinese ports.  Ironically, its cargo is coal.  The ship hops from one port to another with the batteries being recharged while cargo is being loaded and unloaded.

 
 
 
The Feel Good Factor
8/27/2020 5:08:35 PM

The Feel-Good Factor

Have you ever bought a winning lottery ticket, watched you favourite sports team win or had a fantastic time with your friends and family?  These events bring feel good emotions that make us happy and more carefree because we are enjoying ourselves.  It’s the Feel-Good Factor.

In the world of investing you get the feel-good factor when you make a deal that allows you to make money at the start of the investment and again at the end of an investment.  You get the feel-good factor when you’ve bought an investment that goes up and up to make you a lot of money.

In September 2007, Northern Rock Bank became the first UK bank in 150 years to see a run on a bank.  A run is when there is a panic by depositors wanting to get their money back.  This together with a string of economic disasters led to the Credit Crunch in February 2008 and subsequently the worst recession in history.  So bad it became known at the Great Recession.  Throughout this difficult time everyone became familiar with the terms Austerity or Austerity Measures.  It meant everything financially was restricted.  There was no government spending as governments tried to balance the books.  Benefits were reduced or even scrapped in some cases.  Infrastructure spending on roads, schools, energy, railways were all stopped.  Wages were frozen.  While some loosing of the restrictions did happen eventually, no matter what country you were in everyone spoke about austerity measures.

Fast Forward to 2020 and the Coronavirus lockdown.  The lockdown in almost every country was instigated to try and reduce the spread of the virus so hospitals could cope with the massive influx of patients suffering from an illness no-one had previous experience of dealing with.  The lockdowns were longer than initially thought dragging into 3 months or more before lockdown restrictions were eased and, in some areas, removed completely.  The result of this was an economic disaster which has seen many countries, whose economies were balanced on a knife edge, plunged into the worst recession they have known.

Having learnt, austerity measures have a restrictive effect on growth within the economy governments introduced the feel-good factor to boost spending and increase motivation to get back to work, have holidays and show the world’s populations everything is back to normal.  But is it?

As an investor, it has caused confusion within the financial markets with mini booms that will no doubt go bust leaving financially uneducated people struggling to make decisions on what to do with their money.  As a professional investor trying to identify the safest investments during this period is difficult, what hope do novice investors have?


Each country came up with their own initiative about which area of the economy needed the biggest boost or would help reduce the impact or a market collapse.

The UK boosted the property market by reducing stamp duty in the UK.  England benefitted from this with Wales, Scotland and Northern Ireland, devolved governments, offering less incentives.  The impact a robust increase in English with increased house prices taking property investment money from the Welsh, Scottish and Irish Markets.  Instead of a stable UK property market it is now fractured.

The UK Share Market is also interesting.  Being paid to stay at home gave people a false sense of financial wellbeing with surplus cash in their pockets people started investing the share market to the extent that one business which had called in the administrators and seen it’s share price drop from several pounds to pennies had uneducated people piling their money into the shares thinking it was a buying opportunity instead of a dud.

Finally, the UK decided, if they can’t get workers back into business offices which would trickle spending into high streets and malls, there must be another way to do this. 50% dining vouchers to encourage eating in restaurants and getting the population mobile again.  What happens when the vouchers end later this month?  Are families still going to eat out?

The US have been plowing money into the Bond Market to prop it up.  It is an essential market for the flow of cash in world economies but it has created a false economy where people think they can’t fail as the government will bail them out. The bailout is part of an agreed support mechanism between many countries to keep economies moving. 

Instead of the one extreme we’ve seen for many years, that of austerity measures, governments have gone to the other extreme of creating a false economy of reckless spending and investing through the feel-good factor.  When the feel-good factor diminishes so will the economic fallout.

There is no doubt, the feel-good factor, is overriding common sense.  It is creating unsafe and unstable bubbles which will implode at any time leaving small investors out of pocket.  We’ve already seen Gold go up to US$2075.76 and then rebound down to US$1865.79 before settling around US$1924.  The UK property market went up 1.7% in a month.  The FTSE100 which dropped from 6818 down to 4993 quickly went back up to 6500.  Based on current economics this market should be down much further than it is.    

Don’t let the feel-good factor lull you into a false sense of being able to make money quickly. Become an investor.  Investors are people who sit back, watch the turmoil, absorb the information and wait.  And wait.  And wait until the right market conditions come to them to make the best, safest, profitable investments.

In the £2.73 Free Facebook Group you see information about what the markets are doing and when.  Join the group now and start a pragmatic journey to wealth creation. https://www.facebook.com/groups/1032901670065445

Market Report 24th August 2020
8/24/2020 9:18:36 AM

Market Report 24th August 2020

A roundup of economic stories which caught my attention during the past week.

 

All Change

Covid-19 lockdowns and social distancing have played havoc with the US coin market to the extent they asked consumers to pay for whatever they can with coins.  Due to lockdown and social distancing the US Mint are unable to produce enough currency coins and bullion coins for the markets to meet demand.  A spokesman for the US Mint explains that normally there would be a certain amount of currency coins in circulation but with shops closed and services reduced customers are holding their coins and not spending them.  An appeal went out for coins to be used to pay for good and services where possible or to pay with debit cards as businesses are unable to get sufficient coins to provide change when notes are used.

Cardtronics, one of the biggest ATM operators in the UK ask for the interchange fee between banks to be increased so it can increase the number of ATMs in its network.  The fee was reduced from 28p to 25p reducing income for the company to provide services.  As a result it has reduced the ATM network from 22,000 machines to 17,500.  The company state there seems to be a push to remove cash from daily life and move people onto card transactions but that hits certain markets who are totally reliant on cash.  The increase in the interchange fee would allow Cardtronics to install more ATMs and provide services to communities who are losing banking services through bank closures.

TSB Bank are trialling the closure of across counter banking services in 14 branches. The branches will stop accepting transactions from 2pm daily with the bank encouraging customers to use alternative ways to do their banking.

 

The Debt Bubble

In my blog, All Money is Loaned into Existence, I talk about economies being debt based and growing at an exponential rate.  Latest data from Office of National Statistics (ONS) shows the UK money printing schemes to support the economy during lockdown has created debt levels in the trillions of pounds and debt is now at 100% of GDP.  Other economies have followed suite.  The question that remains now is how to get debt back to an acceptable level.  Higher taxes and inflation appear to be the two key ways to make the debt appear more controlled.  Higher taxes will help reduce the amount in money in circulation and inflation will make the debt appear smaller.  Negative Interest rates are already being used as a tool to bring in extra cash.

 
graph supplied by ONS


Commodities

Gold – continues its downward trend to a more realistic price level for the current economic situation as the “Feel Good Factor” (see blog Thursday 27th August) impacts the false economy. Gold is at US$1934 offering good investment opportunities before it starts the proper climb in price.

Silver – as always follows suite closing down at US$26.30 again offering good investment opportunities

Gold:Silver Ratio – is moving upwards again from a low of 70 to 71.97.  This indicates silver is the commodity to buy at present offering the best value for money and when markets do move upwards again there is still plenty of leverage within the ratios

Although, Gold & Silver markets are correcting at the present the best way to be active in these markets is to have a plan to purchase the commodities on a regular basis.  With the price being volatile it is unwise to invest large sums at present and a PCA strategy over the longer term will be cost effective and offer the best opportunities for future growth.

Oil – Warren Buffett sells his US$10 billion holding in Occidental Petroleum.  He has bought the common stock to help fund the company’s expansion but the timing was unfortunate with the virus lockdown and crash in oil prices making it unviable for the company to drill for oil.

Carbon Footprint – sees a growing number of oil and gas companies looking at ways to measure and reduce their carbon footprint.  This has resulted in a growing number of technology companies launching carbon emissions tracking and accounting software according to Reuters.

Market Report 17th August 2020
8/19/2020 4:01:53 AM

Market Report 17th August 2020

Business as usual in the markets even though Britain officially goes into recession.

What a crazy week in the markets which failed to react to Britain going into recession.  Not only did the normal corrections not happen but there was a coordinated effect between Central Banks to provide quantitative easing into the economies to try and keep businesses moving. 

Several Venture Capital groups held their hands out for support with governments looking at how to keep them going.  This was first done in March 2020 during lockdown.  In the US economy in March they asked for trillions of US dollars.  To now see the UK following suit is alarming as it sends out the message if you are a big organisation heavily in debt the government will support you rather than making sure the business models they operate, work properly.

The impact on the share market has seen prices bounce back rather than reflect the true economic position.  This has caused the IMF to issue warnings about irresponsible reactions to the economic situation.

Despite this, it seems governments are taking the stance that spend, spend, spend is better that austerity measures.  Though at high street chains continue to call in the receivers, it makes you wonder who is benefitting from the spend mentality when John Lewis announced its flag ship store will not reopen and Debenhams called in the administrators.  250,000 jobs were lost in the last quarter so who is the quantitative easing benefitting.

The Travel Industry is one of the hardest hit and it was hoping for a summer come back to get it through the winter and ready for a better 2021.  However, this week Virgin Atlantic called in the receivers.  The 2nd Virgin Airline to go under as the one in Australia failed during lockdown. More locally for me, Jet2 stopped all flights into Spain and Ryanair, who traditionally, go onto a winter timetable of 3 flights a week from 1st October, announced they would not operate a winter timetable this year and all flights would be cancelled until March 2021.

Banks still continue to have problems and in America, Warren Buffett’s Berkshire Hathaway sold is entire holdings in Goldman Sachs and part holdings in Wells Fargo and JP Morgan.

 

Commodities

Gold – fell back from the hefty highs of last week as speculators started to move out of the market. Warren Buffett having raised funds from selling bank shares bought US563 million dollars worth of shares in a gold mining company Barrick Gold. In response to his purchases Ray Dalio’s Bridgewater Fund also purchased a similar amount of gold.  As these types of investors move into the bullion market, we are likely to see similar investors move in.  This will provide a more stable foundation for the future growth of the gold and silver markets.

Gold price retreated to US$1945.  Expect the price to go up and down like a yoyo over future months while governments try different tactics to pull the economies out of recession.

 

Silver – also retreated in spot price down to US$26 as it follows the trend of gold movement.

However the gold:silver ratio was back up at 74 having dropped to 70 the week before.  Silver still provides a good investment opportunity.


 

Oil – Despite US sanctions, Venezuela upped production hitting an average 325,000 barrels daily average. The increase comes from diesel-for-crude swaps which are not covered by US sanctions.  The increase will help ease the fuel shortages in Venezuela as well as providing much needed boost to the economy.

ESG Funds – Environmental, Social and Governance (ESG) Funds are getting a major boost from investors such as Blackrock and Jeff Bezos.  With these types of funds proving popular and starting to be regarded as a safe haven investment there is a shortage of products available for investing large sums of money.  However, Wall Street are now looking at boosting availability through the ESG portfolio hedge fund.  

 

Don't Fear Recession. Fear Lack of Financial Education
8/13/2020 9:08:05 AM

Don’t Fear Recession. Fear lack of Financial Education.

As countries start tumbling one after the other into recession, fear takes hold and most people panic.  What happens if I lose my job?  Will I be able to pay my mortgage or rent?  How do I pay household bills? There are, a myriad of fears that race through people’s minds.  They are genuine fears, yet, the one thing they should fear is not even considered.  The fear of not having enough Financial Education to be able to make the right choices for the economic climate.

 

Opportunities for Investors

When I speak about the difference between Investors and Traders, I cover how patient an investor has to be.  They have to patiently wait for the magic of their investments to start producing results.  I liken it to watching paint dry.  It is painfully slow when you first start investing and while you wait for your investments to get to the level where they can support you.

The other part of patiently waiting, is waiting for the investment opportunities that abound at certain times in certain economic times.  As a bullion investor, I have been patiently waiting for 20+ years for the gold and silver to reach a specific level for investments.  I am still waiting and expect to be waiting another 4-5 years or more to get the results I expect from bullion investments.  I know the market will get to where I expect it to be so I can take advantage of the investment I have made in bullion.  I know because I spent years learning about Bullion Financial Education.

Within investment categories – I teach 4 categories – Business, Property, Paper and Cash – there are always ups and downs in each category.  Recessions are exactly the same, some investments within each category will go up and some investments will go down.  Financial Education will teach you what to look for and how to position yourself to take advantage of the situation.  For instance, in a previous blog, I spoke about how in business, some traditional businesses will struggle in a recession, but how there are businesses which will thrive in a recession.  Owning one or two businesses will allow you to use the economic markets to your best advantage to grow your wealth and support or even improve your current lifestyle.  These do not need to be big businesses they can be side hustles that can produce regular income for a small amount of regular working hours per week.  Often an hour a day will have significant benefits.

There are businesses which thrive in a recession such as franchises and network marketing businesses.  These businesses attract dedicated people who have lost jobs and are looking for some way to make income.  They are dedicated and have a sense of urgency to generate an income.  Many of these people will make a success of a business because they know the feeling of being made redundant and don’t want to find themselves in that position again.  They work hard to make their business ultra-successful.

Financial Education helps you to see the opportunities that exist no matter what the financial markets are doing, no matter whether there is a recession or not.


 

Making Money in a Recession

There is no doubt, investment opportunities are different in a recession.  However, preparation for a recession is key.  People who have been building assets and then watch the indicators that a recession is on the way will usually have prepared for the situation by selling some investments and moving into cash.  As they say, cash is king. 

Cash will allow you to take advantage of lower priced assets which can be purchased with the cash you have. 

Bullion is another cash asset which depending on the markets and the metals ratios will let you leverage money to take advantage of the ratios.  For instance, when the Gold:Silver ratio is high you purchase silver.  As the Gold:Silver ratio drops you sell the silver and transfer into gold.  Then continue buying gold.  Silver is the leverage to get into gold.  The key to remember with Gold:Silver is not how much gold or silver costs but rather the buying power it has in a recession.  If during good economic times it takes 100 gold coins to buy a property what will it take in turbulent economic times.  The cost could be 50 gold coins or 10 gold coins.  It’s purely guessing at this stage depending on the depth of the recession.  However, if you bought 100 gold coins when they were cheaper and then were able to buy 2 houses or 10 houses, with the bullion, as the price of houses comes down and the price of gold goes up.  What is your buying power?

 

Transfer of Wealth

It is often said that during a recession there is a transfer of wealth.  But what does transfer of wealth actually mean?

For people who prepare for a recession, it means they have built income producing assets, investments, in all 4 categories of business; property; paper and cash.  They balance each of the investments with each category so they always have an asset which is going up in value if another is going down. This is called hedging.  A way of protecting what you have.

Investors will ensure they are earning income from as many of the 8 income sources as possible guaranteeing and protecting cashflow.  This means they have plenty of resources to purchase more income producing assets when they need them the most.

As an economy starts to recover, those who bought more assets during the recession will see their wealth increase dramatically.  By how much is unknown.  But this increase in wealth is known as the transfer of wealth.

 

Financial Education

As countries head into recession, what will you be doing to protect yourself, your family and your financial future?  Financial Education is key to this and is not a luxury but a necessity to ensure you make the best decisions you can in the circumstances.

Don’t fear a recession.  Fear lack of Financial Education.

For more information about the training courses we run, email info@2pound73club.co.uk or visit our Facebook Group https://www.facebook.com/groups/1032901670065445

Market Report 10th August 2020
8/10/2020 10:45:29 AM

Market Report 10th August 2020

Gold at record highs is the main focus of today’s market report.  Last week Gold broke through the US$2000 barrier reaching a high of US$2075.76 before falling back to US$2030.14.  This represents an overall gain for the week of 2.78%

Don’t panic! Thinking you’ve missed out on the opportunity to profit from Gold.  This weeks prices were based on speculation rather than economic fundamentals so be ready for a drop in price and the opportunities that will arise.

Technical Analyst, Karen Jones, from Commerzbank said “The never-before-reached US$2000/oz is a major psychological resistance level, with gold’s 49-year trend channel resting just below it at US$1983.  Only an end-of-month or, better yet, end-of-quarter close above these levels will signal a breakout in the price of gold”.

In other words, there is no support at present for the currently high prices.

Charting is a popular way to analyse bullion movement and predict where you expect the prices to go.  Using a 20-day moving average and RSI indicator support for Gold is coming in at US$1875 indicating the correction on the current speculative prices could drop quite substantially.

“The 20-week moving average is currently at US$1755” says Tom Pelc an independent technical analyst.

The general consensus by analysts is the price of bullion will fall back quite sharply.  However, when it goes back up, based on fundamentals in the economy rather than speculation the feeling is that gold could go up far more spectacularly offering excellent  investment opportunities.

Pelc continued “if resistance is broken, Fibonacci extensions offer short-term targets.  These are based on the idea that a rally will extend in predictable proportions extrapolated from a previous rally.  One is at US$2067 another comes in at US$2286.  Lucas ratos – another tool using a sequence of numbers similar to Fibonacci’s- suggests gold could rise to US$3598 an ounce in 4-5 years.”

If these experts are anywhere near right on their projections then there will be plenty of opportunities to make a decent profit from gold bullion in the near future.


 

Silver reached a high of US$29.88 before dropping back to US$28.33.  This gave an overall increase for the week of 16.07%.  Silver hit an all time high of US$49.45 on 18th January 1980 and then in the 2008-2014 Great Recession went up to US$42 to ounce.  There is still a lot of opportunities available with this currently undervalued commodity.

It’s worth noting that despite the high prices for gold, traditionally, silver outperforms gold.  Historical charts show it initially lags behind gold and when it moves it’s 3 times more than gold in either an upward or downward direction.  The latest charts again show silver outperforming gold.

Put a plan together to regularly invest in small quantities and you will do well in the coming years.  Using a PCA strategy will even out the costs and when the economical fundamentals support the price going up you will be in the best possible situation to reap the rewards.

 

ETC’s broke all records last week as more funds were transferred into them during the “gold rush”.  It is estimated that ETC’s now have more gold reserves than the Bank of Japan which is a major holder of the commodity.

 

Where has the money been flowing

Indications to date, are that with the economic impact countries are seeing investment money go into different markets.  In the UK, property prices have gone up in July indicating more investment into those markets while in the US and in parts of Europe the Share Markets have rebounded.  IMF have warned that economies are unlikely to get back to pre-covid-19 until 2022.  Undoubtedly, money will flow in and out of markets making it extremely volatile in the coming months.

 

 

 

 

Why Business is Your Biggest Investment
8/6/2020 10:01:10 AM

Why a Business is Your Biggest Investment?

Most people think of business as something they work in daily that brings in money to keep a roof of their head and food on the table.  But a business is an investment and one of the biggest investments you are likely to have.


What Type of Business Do you Start?

A hobby was the first business my husband and I set up.  My husband was a racing driver who built his cars and engines.  He was approached by a friend who ran a garage to see if he could do some specialist welding repairs on a vehicle.  This led to the friend being able to take on insurance work using my husband as a subcontractor.  This business was run as a hobby.  My husband would do his full-time job during the day and in the evening, he would do the welding repairs.  In his day he was one of two guys in New Zealand who could do plastic welding.  He was also one of a few people who was a specialist welder for vintage and veteran car rebuilds.  Welding was not his profession, it was a skill he had learnt for building his racing cars but became a side hustle.

Most people become self-employed because

1.       They are made redundant and are unable to find another job quickly so they start a small business in an attempt to bring in extra cash to replace a lost wage.

2.       They believe they can do a better job than their boss or the company the work for so set up their own business

3.       They have a hobby and think they can monetise it

4.       Are fed up with their jobs and are looking for a way out

5.       Have always wanted to have a business but timing was never right to start it.

There may be other reasons but when talking to clients these are the key reasons that they come up with.

 

How Do You Start a Business?

So, how do you actually start a business?  You first have to find clients.  No one has a business if they don’t have clients.

I often see people talking about designing a logo, getting business cards, having a business plan, having a website, setting up their social media post etc.  But, until you have your first client you don’t have a business so the number one focus has to be finding the client first.  The logo, business cards, website etc. always came once I had paying clients who covered the cost of setting these things up.

The old adage is people do business with people and that is very true. I’ve started businesses by networking.  Going to a variety of different types of events and talking to the people who are there.  I get their business cards and follow up with them.  I’m not waiting for someone to call me.  I take charge of the situation. 

Now you have the opportunity to get your first clients and start trading.


 

Why Business is Your Biggest Investment

There are 4 key investment categories, business, property, paper and cash.  Business is the key which generates the income that allows you to be able to invest in other categories.  Without a source of income, you are unable to get started in other types of investing.

But having a business is not just about generating and income.  There are people whose investment strategy is based on building and selling businesses.  They might start a business from scratch.  Build it to a certain level then sell it and start over again.

There are investors who prefer to buy into an existing business and increase the value of it before selling.  Another strategy is to buy and hold several businesses all generating income for you.

Business is an investment.  It is not just another job from 9am – 5pm that provides your monthly wage.  It is a genuine investment which can provide investment capital to buy into other investments.

Business can be the biggest investment you will ever make.

For more information about investing and the training programs we offer connect with us at
info@2pound73club.co.uk

 

Market Report 3rd August 2020
8/3/2020 9:38:47 AM
Market Report 3rd August 2020

Welcome to my weekly report of the things which have caught my attention over the past week.

Shockwaves reverberated around markets on Friday as the US recorded it’s biggest economic contraction in history with the economy down 32.9% for the 2nd quarter.  This is very worrying as the US is yet to reach the peak of the pandemic and furlough schemes ended on 31st July 2020 suggesting unemployment will escalate.

In Europe, countries also released their GDP 2nd quarter figures with Spain down 18.9%, France 13.8%, Italy 12.1% and Germany 10.1%.  Britain has not yet released it’s figures.

Gas has long been one of Russia’s biggest exports, but the surge in demand for gold has seen Russian exports in metals exceed oil for the first time.  Russia’s Central Bank reported that the country’s gold exports jumped to 65.4 tons in April and May with a value of approximately US$3.55 billion.  In the same period natural gas exports dropped to US$2.4 billion.  The drop in demand is in line with global drops in demand due to the pandemic.

Chinese banks start banning their clients from purchasing gold.  They have taken measures to prevent customers from buying gold, platinum, palladium and other precious metal-related products through them.  The Shanghai Gold Exchange and Bank of China have also stopped opening new accounts for trading.

TikTok a growing video platform is broiled in controversy due to it being a Chinese owned social media company.  With the ever-increasing hostilities between US, UK and China this company has come under fire with espionage claims.  US Government have told China they must sell their US arm of the company or face closure.


 

Commodities

Gold – reached an all time high before dropping back slightly to US$1975.85 but that still equates to a weekly increase of 3.85%. 

Goldman Sachs has revised its 12-month gold forecast to $2300 per troy ounce.  Investors in Gold remain mainly speculators although mainstream investors are likely to enter the market if gold reaches US$2000.

For the second consecutive week more than US$100 million has flowed into Gold ETC’s due to the volatility offering trading opportunities

Silver – closed at US$24.41 with a weekly growth of 7.11%

Gold:Silver Ratio – which had been steadily dropping increased slightly over the week to 81.48 indicating silver is still undervalued and offers the best investment opportunities at present.

Oil – the price has been moving sideways, at $40 a barrel, for a couple of weeks but is now going down again with WTI Crude closing $39.73.  Saudi Arabia and India announce they are likely to cut back production.

Chevron Coporation reported it’s worse losses in history on Friday with a net loss of US$8.3 billion.  A combination of reduction in demand due to the pandemic and US sanctions against Venezuela which force the company to close down it’s operations there.

Other oil companies are also struggling with UK, company BP has indicated it is likely to cancel their dividends.  This is a huge blow to pension companies who rely on dividends to boost their revenues for the pension schemes.

Alternative Energy – After 35 years of negotiating, planning and delays the 5 year plan to build the largest fusion reactor in France has finally started.  The project is funded by US, Russia, China, India, Japan and South Korea.  It will be the largest tokmak fusion device capable of generating 500MW of thermal fusion energy as soon as 2025.

For more information about investing and/or training programs visit our Facebook Group https://www.facebook.com/groups/1032901670065445 

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