With the exception of the US Dollar Index, all markets were ugly last week. Silver led the way as far as declines went, falling a whopping 14.32%. As we have warned, when markets rise parabolically like silver did, a pullback is highly likely. We are now seeing that pullback.
As longer-term readers of this newsletter know, we have long advocated for a “Two-Bucket Approach to managing assets. Over the past few years, as we have been forecasting the events that are now occurring, other individuals and companies in our industry have begun to promote what they label a two-bucket approach to managing assets.
To a casual observer, the economic news is mixed. Depending on the story one is reading, you would conclude that we are in a severe recession, even a depression or, on the other hand, we are seeing a quick recovery from the economic fallout from the lockdown response to COVID-19.
While there is no fundamental justification for it, stocks rallied again last week and rallied strongly.
Silver continued its monster breakout last week, rising 15.54%. All markets were higher with the exception of US Treasuries and the US Dollar Index which were mostly unchanged.