Gold price - doubling possible
Geopolitical tensions are not even taken as a reason for this. Because these usually only have an effect for a short time. So-called structural trends should be the reason for a significantly higher gold price.
These structural causes include enormous global debt, a weakening economy and falling real interest rates. In the ranking of the most indebted countries, the USA occupies the sad first place. Around 23 trillion US dollars in debt are the reason. The creditors are primarily China and Japan.
On the other hand, the production of the gold mines is declining. The peak has been passed and the development and production start of new mines takes time. Until 2006, South Africa was the largest gold producer on earth. Today the country is about seventh in the world. Because there are practically no new lucrative gold deposits, the gold content of the producing mines is declining and the search for gold has to go deeper and deeper (up to 4000 metres).
Investors seek the safe haven of gold. This can be seen in the growing interest in Gold ETFs. According to the World Gold Council, ETF inflows in 2019 amounted to 401 tonnes of gold. This is a fivefold increase compared to 2018.
Another driver for the gold price is likely to be the central banks, which have bought gold net for the tenth year in a row. In 2019, 15 central banks have increased their gold holdings. Turkey was the most strongly represented country. These are all good reasons for a further rise in the gold price and could be the reason for investors to bet on shares of gold companies.
Caledonia Mining or Auryn Resources could be considered here.
Caledonia Mining has produced more than 55,000 ounces of gold at its blanket mine in Zimbabwe in 2019: https://www.commodity-tv.com/play/newsflash-with-skeena-resources-caledonia-mining-copper-mountain-and-millennial-lithium/. Operating improvements, lower costs and a strong gold price resulted in higher than expected profits. The company pays dividends on a quarterly basis.
Auryn Resources owns seven projects: https://www.commodity-tv.com/play/auryn-resources-getting-environmental-permits-to-start-drill-campaign-on-sombrero-soon/. The flagship project, the Sombrero Copper-Gold Property (over 130,000 hectares) in Peru has already scored with high copper and gold grades on samples.
Recent corporate news and press releases from Caledonia Mining (https://www.resource-capital.ch/en/companies/caledonia-mining-corp/ and Auryn Resources (https://www.resource-capital.ch/en/companies/auryn-resources-inc/).
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