The Top-Performing Asset Class for the Next Decade

What Are Commodities?

Commodities are raw materials or primary agricultural products that can be bought and sold. Examples include oil, gold, wheat, and natural gas. They’re traded on exchanges and can serve as investment vehicles or inputs for production.

Transcript

I think commodities, specifically precious metals, are going to be the number one performing asset class over the next couple of years and even potentially the decade, excluding crypto. And in this video, I want to explain to you exactly why. But first and foremost, what are we looking at? We’re looking at a tweet that I just tweeted 17 minutes ago, and I’ve been talking about this for a few months now.

If we look at it from a fundamental perspective before we dive into technicals and actually look at historical data, right now we’ve got wars overseas. We’ve got China and Russia kind of teaming up against Ukraine. We’ve also got China going after Taiwan. The U.S. is back in Ukraine. There’s a bunch of uncertainty. No one knows if it’s going to start World War III. So, massive uncertainty with the wars overseas.

There’s high inflation nearly everywhere, not just in the United States, but honestly way, way, way worse in other countries. It’s eroding people’s belief in their currency and their purchasing power. And the belief part is even more important than actually what it does physically to the debasement of the currency because once you lose belief, you lose the value of that currency.

We’ve got economic uncertainty with high rates, low economic growth, and people just not certain. We’ve got really high consumer debt. We’ve still got high consumer spending, which is not a good sign because we’ve still got high consumer debt. And we’ve also got wages that are kind of stagnant, if not even close to keeping up with inflation. And then again, we’ve got the disbelief in currencies.

So, a lot of fundamentals are really, really strong for gold, silver, and precious metals. Okay, all these things are very bullish for commodities, specifically precious metals. And if we were to go ahead and look at charts right now, let’s actually look at historic chart data and go back to a time when we had somewhat similar situations that we’re in right now. We had high inflation and low economic growth. That was in the ’70s.

So, in the ’70s, we had kind of this sideways action in the stock market after a really big rally from after the Great Depression. And then we had really high inflation, we had higher than normal rates, and we had low economic growth, which is what we are experiencing right here, right now in 2023. And if you’re looking at this chart right now, this is the stock market, the S&P 500, on a weekly chart. Right here at the bottom, we’ve got the price of gold. Actually, it’s not the price, it’s the percentage increase that it has from its low over here.

So, let’s go ahead and look. If you look at what happens with precious metals, they kind of work almost inversely related to what the stock market does. So, when the stock market has really big rallies, you tend to see precious metals not really do too much. But then when the stock market comes down and it’s kind of chopping sideways, you typically see precious metals go way up.

So, we’re looking at a stock market rally, right? And then what happens when we’ve got a lot of uncertainty, we’ve got higher rates, we’ve got high inflation? Well, we see gold just ripped through the roof, went up 450%, and then went absolutely parabolic, 2,200% by 1980. The same thing happened with silver, guys. We saw silver start to take off in the early ’70s.

Check out this other read to learn more about investing in top performing asset classes.

You may watch the video on YouTube by clicking here!

Jeff Sekinger

Jeff Sekinger

Founder & CEO, Nurp LLC

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