The price of gold topped $1,200/oz overnight and is set to continue moving higher as Trump sets off a bout of uncertainty over the U.S. economy after his presser.
Let’s be honest…
Trump’s press conference yesterday was a complete waste of our time.
He provided no new details on his economic or fiscal plans, and it was clear that the main point of the conference was to set up legal protections for Trump to distance him from a conflict of interest between his private businesses and holding the POTUS office.
The secondary goal was to put the kibosh on “Pissgate.”
But this lack of new information on Trump’s economic or fiscal plans is very concerning. Yesterday’s press conference was a prime opportunity for Trump to lay out his objectives and proposed methods in detail. But that didn’t happen.
If Trump had well thought-out economic plans for the U.S. with established goals, he would have told us about it yesterday.
And with no mention of any new details, it’s becoming clear to investors that Trump is just shooting from the hip with no clear direction for the U.S. economy.
Up next, the new president will have to deal with the national debt crossing $20 trillion. It’s expected that the U.S. federal debt will reach $20 trillion in a matter of two or three weeks, almost immediately following Trump’s inauguration.
How will Trump address the national debt?
Most likely in the same way he addressed the U.S. economy yesterday… he’ll ignore it. This will likely further add to uncertainty over the U.S. markets and continue to boost gold prices in the short term.
For investors, this will provide an opportunity for easy gains. With that in mind, here are two gold stocks to buy right this second…
Barrick Gold (NYSE: ABX)
Barrick is the largest and most well-known gold producer in the world. And in an environment of rising gold prices, Barrick is one of my main targets for large institutional buyers. The stock is a must-own for any gold investor.
Shares of ABX opened this morning at $16.68, which I think is a steal. Barrick will announce the company’s Q4 and FY2016 earnings on February 15. The company’s Q4 numbers will most likely be weak due to falling metal prices ending 2016.
But due to the huge turnaround in gold prices during the first half of 2016, Barrick’s Q4 data will be overshadowed by positive year-on-year earnings. And I think 2016 was a better year for Barrick than the market is generally giving credit for right now.
Royal Gold (NASDAQ: RGLD)
Royal Gold is the largest and most well-known gold royalty company, and another major target of large institutional buyers when gold is hot.
RGLD opened this morning at $66.67, and although I think ABX has better upside potential in the short term, gold royalty companies are a bit less risky than miners and might be better suited for a longer-term holding from here.
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Looking elsewhere in metals, investment demand for silver is also ramping up. In many recent surveys, investors say they are more bullish about silver prices than other metals for 2017.
The price of silver bottomed out with gold at the end of December at about $15.85 an ounce. Since then, the white metal has bounced and is now approaching $17.
I believe there is still much more upside to silver from here, but I personally remain most bullish on gold and gold stocks. But if you’re looking to add silver leverage to your portfolio, here are two must-own stocks.
Pan American Silver (NASDAQ: PAAS)
Pan American Silver is not the largest silver producer in the world. However, it’s one of the largest primary silver producers. Companies like BHP Billiton (NYSE: BHP) produce much more silver by volume. However, they also produce other metals, which are subject to other market forces.
Pan American is one of the most well-established primary silver companies and a great play for silver leverage. Share prices of PAAS opened at $17.03 this morning, and I think that’s a steal.
The company will release its Q4 and FY2016 earnings data on February 15. And like Barrick, I think 2016 was a better year for Pan American than the market is generally giving credit for, for the same reasons. PAAS is a buy.
Silver Wheaton (NYSE: SLW)
Silver Wheaton is the world’s largest silver royalty and streaming company, and in times of strong silver prices, it is also a target for institutional and fund buyers. SLW opened this morning at $20.28. And I think shares are a strong buy for mid-term gains.
We’ll talk again soon.
Until next time,
Luke Burgess
As an editor at Energy and Capital, Luke’s analysis and market research reach hundreds of thousands of investors every day. Luke is also a contributing editor of Angel Publishing’s Bull and Bust Report newsletter. There, he helps investors in leveraging the future supply-demand imbalance that he believes could be key to a cyclical upswing in the hard asset markets. For more on Luke, go to his editor’s page.
