Is it just me, or does everything newsworthy seem to be extremely divisive at present? There is an awful lot of it about, Trump, Brexit and the Middle East. The current level of white noise distraction in world politics is deafening. No real intent or content, just sleight of hand and the usual rattling rhetoric of governments and institutions in their struggle to maintain the status quo. In addition we have the media's relentless repetition of sound bites that echo after the great British self extraction vote from Europe:
• 'the British people have spoken'
• 'adrift without a rudder'
• 'negotiating the best deal for the British people'
You could be forgiven for thinking all is done. But take heart, for although this narrative looks set to continue with the media talking up a ‘Hard Brexit’ there is something you can do to protect your hard earned cash. And here's why I think it needs looking after...
Is Brexit making your cash more vulnerable?
1. European central bank (ECB) nearing collapse, warns Alan Greenspan Federal Reserve governor from 1987–2006
Outweighing the problems of the US Federal Reserve the ECB now faces an imminent exit from the UK which might expose the banking sector vulnerability, this is what Mr. Greenspan had to say on the 20th February:
“The asset side of the ECB’s balance sheet is larger than ever before, having grown steadily since Mario Draghi said he would do whatever it took to preserve the euro. And I have grave concerns about the future of the Euro itself. Northern Europe has, in effect, been funding the deficits of the South; that cannot continue indefinitely. The eurozone is not working."
Fears for the pound and FTSE are driving people into physical gold and silver, which is reflected in the huge up surge in sales of physical precious metals
3. Potential Frexit
More jitters to come for investors with anti Brussels campaigner Marine Le Pen running for the French presidency
4. Ongoing hostility to the East
The economic impact of war on the price of gold is well documented
5. China vs U.S. Trade war
Tweet from President Trump – "China has been taking out massive amounts of money & wealth from the US in totally one-sided trade" and added that US-listed General Motors (NYSE:GM) should "make [cars] in USA or pay big border tax!"
Precious metals as a long term investment
If you buy gold and/or silver for the long haul it is hard to imagine a scenario that won't reward your patience in the future as the historical trend is UP. That is not to say there will not be peaks and troughs, but if you look at the diagram below you will see the overall upward movement. This is hindered by banker manipulation, which cannot continue forever. Deutsche Bank are already being investigated for price manipulation, fellow collaborators also include Societe Generale, SBC Securities, Scotia Mocatta, UBS AG and Barclays too.
If this has been of any interest or help please share. And as usual your comments are always welcome!