Americans could become gold fans
Geopolitical uncertainties around the globe, plus inflation flaring up. So far, savers in the US have turned a cold shoulder to these threats. In fact, U.S. citizens also preferred to take on debt than elsewhere on the planet. But Corona has put an end to that trend. The savings rate among Americans also went up to a range of 35 percent in 2020. From that high level, of course, the savings rate among U.S. citizens has come back sharply. But even today, at nearly ten percent, it is still higher than the average of the past 40 years.
This also means that Americans' savings accounts remain well-filled. This in turn means that US savers have more to lose today than in the past. True, savings accounts in the US are collateralized by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. But beyond that, Americans are taking a risk if a bank collapse were to occur. Savers will realize this sooner or later. Probably even sooner, since they are already losing purchasing power on their savings. Currently, Americans would have to receive $3,977 in interest income for every $100,000 in savings to compensate for inflation. However, they receive only 70 dollars.
Once this gets into heads, ways out will be sought. Some U.S. savers will go into riskier assets to siphon off returns. Others, especially those with more than $250,000, are now likely to look more to precious metals. It is entirely conceivable that increased gold demand will come from the US in the coming months and years. Whether this concerns coins and bars, or ETFs should be of secondary importance. Because this will be good for the gold price.
Should a portion also go into the shares of companies with gold projects, they could profit twofold: on the one hand via the leverage on the gold price and on the other hand from the increased demand for their shares directly. Those who want to get ahead of the Americans can already speculatively bet on gold stocks. Fundamentally good companies with promising gold projects are Gold Terra Resource and Gran Colombia Gold.
Gold Terra Resource - https://www.youtube.com/watch?v=qb84jKh6DTc - can look forward to very good drill results on its Yellowknife City gold project in the Northwest Territories in the Yellowknife Greenstone Belt.
Gran Colombia Gold is already a successful producer. Its Segovia mine in Colombia is producing gold and silver. Other projects are on the company's radar.
Current corporate information and press releases from Gran Colombia Gold (www.resource-capital.ch/en/companies/gran-colombia-gold-corp/) and Gold Terra Resource (www.resource-capital.ch/en/companies/gold-terra-resource-corp/).
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