April 2022 Updates – Markets, Politics and Collectables

Markets

Understand that commodities like gold are currency related. As previously suggested on FB, a retest of the all time high of $2850 AUD would occur. As also previously suggested on FB, the American dollar will have its day FIRST. $USD in the below futures chart at $100 is the line in the sand. The Fed understands that it cannot stop this tsunami of capital seeking safe haven from Covid/China property issues/Europe’s failures/Russia – i.e., the end of this epoch of globalisation. So similarly to the 1920’s and 30’s, America faces capital inflows that will make it’s currency uncompetitive. It will likely be the final nail in the coffin of the post-war Bretton Woods monetary system. But before we see investors clambering into gold, we will see investor inflows into US real estate, equity markets, commercial debt and US Treasuries. AUD is testing resistance at $.75. It could go higher if interest rates lift and commodity prices stay strong. As AUD weakens, gold in AUD should begin to lift again… watch this space! When the US gold market lifts off to all time highs, watch out above!

Politics

The Russian invasion of Ukraine has been a huge learning curve in the understanding of Russian politics. The screenshot below is an informative account of Russia’s history and processes from a Finnish Intelligence Officer and worth watching in full. Putin reportedly dreams of “One Russia”, reclaiming areas of Europe that he believes should be under his rule. He has used the dithering weakness in Brussels and Washington as a trigger for actioning those plans. However, the corruption in Russia has seriously undermined the Russian armed forces.

Putin appears to have left Communist East Germany as a KGB officer and then quickly partaken in the “benefits” of Russian political office. The following article from the World Socialist Website – which has a critical focus on post-communist capitalism in Russia – offers some insight into Putin’s rapid rise to power.

What has become clear is that Putin is no great military leader and Russia is presently wielding an almost incompetent led military force. That Putin thought to enter Ukraine and be received with open arms is evidenced by the relatively small force he invaded with. Alternatively, he thought to repeat the rapid conquests of the Soviet period in places like Romania and Hungary. The following Twitter stream is a useful breakdown of what occurred in the past 6 weeks. My outlook is that this state of economic/political/military conflict will continue for some years, with no one in Europe winning. We left Switzerland in 2017 on the outlook that Europe’s golden years were over. Recent events have reinforced this outlook.

Collectables

The global political fiasco unfolding is putting the floor under all private assets. Real estate, equity markets, gold, silver, base metals, antiques – not one of these markets are selling off. Base metals are rising because of collapsing supply chains. Collectables and other markets are rising as the risk of a currency and financial collapse and/or reset increase. There is only so much “stuff” out there for people to hold – the rest is tied up in a manner that increases the likelihood of a 100% loss when the music stops.

Has anything caught your eye in recent markets i.e., price wise or scarcity? I’ve not been paying attention to recent auctions as I plan for the next stage of Top End Coins. What did catch my eye in one auction – and I simply had to have it – was this equal finest 1949 Perth half penny. I recently published in CAB an article on Australian bronze – you can read it here. The follow up article is on the nature of colour, specifically in Perth Pennies. Coloured bronze is highly prized in the USA; I also believe it is a market worth buying into down under. Bronze still appears to me a fairly neglected market. If you feel differently, please leave me a comment or link to follow up in below.

Cheers,

Les 0455 660 884