Goldman Likes Gold… Really

Goldman Likes Gold… Really

 

BY VBL   via zerhedge.com                               MONDAY, NOV 15, 2021 - 7:52

HouseKeeping: We’ve picked up another bunch of Founder subscribers for which we are grateful. Founders also have full access to Masterclass Archives. Here is part 2 of the Discussion on Spreads.


Precious: Goldman Likes Gold… Really?

Authored by GoldFix at Substack.com

Damien Courvalin, Goldman Sachs Head of Energy Research joined “Bloomberg Markets: European Close” with Alix Steel and Guy Johnson, discussing the state of the metals market. Courvalin believes gold is on the road to $2,000. Here’s that interview and our analysis of his timely recommendation. Click tweet for uninterrupted segment.


FULL INTERVIEW HERE

- Bloomberg Source

Analysis: Read Between the Lines

Everything Courvalin says about Gold, Bitcoin, and Oil is accurate to our ears. The only thing worth adding is the meta-message we see here.

When a bank recommends a commodity asset it is always risky to just trust the research blindly. These are global assets that are not necessarily in their control or purview as much as domestic investments can be. Gold is one example of this. But there is a difference when an energy analyst makes Precious metals comments at this time of year. And it is not historically bad

We feel Goldman and other banks will be likely recommending that RIA clients take some profits in energy, which the Banks put them in last year and has been  wildly profitable, and put some money in Gold. That is asset allocation balancing at it's root. And it makes sense on volatility alone.

We’ve written about this at length before. Here is what premium subscribers read just last month on the topic:

From Gold's Road Map for 2021's Remainder:

Buy Season

Sometime between beginning of November and end of December, asset allocators begin announcing recommendations to their clients for the coming year. These are usually macro percentage allocations like "5% energy, 10% bonds, 70% stocks" and so forth. All done by banks and Registered Investment Advisors (RIAs)

Buy Season is Coming

So will Gold continue to go up and Energy keep going down? No-one knows. But you can be reasonably sanguine that oil profits are being booked as we speak and Gold is benefiting from that. Just look at the behavior of Oil and Gold this past two weeks.