John T. Reed’s news blog

A gold article in today’s WSJ makes two statements that I need to address. . Second column in the article says that stocks “offer some intrinsic inflation protection” because business can raise prices and benefit from growth of the real economy. . Total Bulls***! When a nation gets hyperinflation, the federal government immediately passes what I call the Five Bad Laws: capital controls, price controls, rationing, anti-hoarding laws, and financial repression laws. . Sports fans, publicly-traded companies are not going to be matching inflation rates with price increases during hyperinflation because of price controls. . Duh. . And growth of...

I spent about a year and a half reading all the great books of stock and bonds investing. I was not trying to be a stock or bond guy. Rather, I noticed that each of the various investment fields including gambling and insurance had strengths and weaknesses. .My main field is real estate investment by mom and pop millionaires. That is not institutional real estate (Trump stuff). Real estate investors suck at risk management. Stock and bonds guys are better at it and insurance is great at it. Real estate is great at letting you manage the business. Behavioral economics...

I just calculated the real (adjusted for inflation) long-term average value of silver since 1969. I eliminated 1980 because the Hunt Brothers tried to corner the market in silver. That caused it to hit an all-time record price of $50.35 on March 2, 1980. . That is not going to happen again because the Comex exchange changed their rules to discourage it. The brothers were also found civilly liable and had to compensate for conspiracy against another silver trader, went bankrupt, and lost a billion dollars. So that was a one-off anomaly. . So the average price over that period...

So I keep saying gold is not an inflation hedge because it is gold; rather, it is an inflation hedge because it is a commodity. So here is a look at the long-term real average nickel price [USD/ton]. This is much better than gold or silver. The current price of nickel is $16,418 and the long-term real average price has been $19,956.20. As I said a couple of days ago, gold is now about double its long-term average real value; silver, the average price in February 2024 is $23.27 compared to a long-term real average of $20.18. In other words,...

From time to time, I calculate the long-term average price of gold. Notwithstanding idiots saying you can’t overpay for gold, you CAN overpay and you should not..The only measure I have come up with for telling when you are overpaying is the long-term real (adjusted for inflation) price. Below are the annual-end-of-year prices adjusted for inflation to 2024 dollars..As you can see, the long-term average, real (adjusted for inflation) price has been $1,131.68 since 1969. The current price is about double that. You should buy when a troy ounce of gold is BELOW that long-term average. Not now..The key basis...