Another ugly week for the books…Last week’s market weakness had to do with two primary points. The first is an increase in banking tension in Europe, and the second is the implosion of economic activity in the US. Fear is the name of the game these days, and many investors are playing their hands close to their vests. I am always on the lookout for strong buying opportunities based on my research, and remain confident in the metals and other ETF’s my clients currently hold.
Leading into this most recent sell-off in the market, there were regular media comments about gold’s rise being over done. Since the global economy is looking weaker in the last few weeks, and it is becoming more obvious what a wreck Europe is, gold (and silver) has surged. Now, the forecasters are pushing gold over the $2,000/oz. level… some even further. The one very important item to note about gold is that in the last 5 days, while the S&P 500 lost over 4% and the dollar lost 1%, gold was up almost 6%. Once again we see that the markets are broken. The US Dollar is no longer the safe haven, but we are seeing the precious metals rising as not only a currency in its own right, but as THE safe haven currency. Certainly there will be volatility in the metals, but as long as the Swiss, the Americans, the Japanese, and Europeans all print money to bailout bankers, the metals will continue to shine.
To be quite frank, the poor economic numbers and market volatility are not all bad for my clients, and business has been strong in recent weeks. For those of you who read this commentary, and who are not currently clients, I would be happy to take a second look at your portfolios now that the markets have been rattled these past couple of weeks. Given my research, I’m not confident the markets will stabilize in the near future and welcome the opportunity to put my strategy to use for you.
Do you have an investment strategy that seeks to protect your portfolio against volatile economic conditions? Call me to schedule a free review of your current investment portfolio – 913.693.7918.
John P. Chladek, MBA, CFP® is the President of Chladek Wealth Management, LLC, a fee-only financial planning and investment management firm specializing in helping families and couples who are not yet retired realize their financial goals. For more information, visit http://www.chladekwealth.com.