Gold and Bitcoin: Vital Challengers to Fiat Currencies

Gold is not just breaking records… it passed the $2,300/oz mark on Thursday this week, rewarding the patience of investors who’ve stood by its enduring value.

As gold sets new all-time highs, there’s another asset that’s demanding the world’s attention: Bitcoin. Some have called Bitcoin the digital gold of the 21st century – but is that true? Does it have a place in your portfolio? This week’s Nuggets dives deep into the heart of this discussion.

Let’s get started.

UBS Analyst Says This Gold Rally Isn’t About Inflation

In a recent note, wealth managers at UBS said rising gold purchases by central banks worldwide have reached the highest levels since the 1960s. These bets by central banks could be seen as hedges against the dollar as a reserve currency. Especially coming from nations such as China, they could also represent precautions against future sanctions, in anticipation of still more geopolitical disruption.

Gold Reaches $2,300 – Silver Tops $27

Gold passed $2,300/oz briefly on Thursday. The world’s most popular precious metal has risen more than 10% this year already, setting a series of new record highs along the way. Meanwhile, silver climbed 4% to close at $27.18/oz on Wednesday, the highest level since June 2021.

Gold to $2,500 Says JP Morgan Chase

JP Morgan Chase says gold is their No. 1 pick in commodities markets for 2024, with the potential for the price to reach $2,500 an ounce this year, according to the bank’s global head of commodities research.

Gold’s Rally Makes Front Page of Financial Times
The Financial Times has published a front-page article titled “Gold record: Global jitters reinforce rally,” where they share many ideas that we’ve championed at GoldSilver for years:

“The metal touched $2,295 per troy ounce yesterday, extending a rally that has seen it rise 15 per cent since mid-February. Investors are betting it will fulfill its traditional rose as a hedge against inflation if price increases persist when interest rates start to fall.

Gold is also seen as protection against rising U.S. debt and possible widening of war in the Middle East. Central banks and Chinese consumers are buying in record numbers.”

Silver’s Turn to Shine: The Next Breakout Commodity

Gold is in the spotlight, but silver could be next. In a recent report to customers, Sprott outlined three reasons why silver is poised for a breakout sooner rather than later:

Silver is maintaining its monetary value as gold prices go higher from central bank and sovereign buying.

Silver’s correlation to the reflation trade. Silver has often correlated with broader economic activity due to its wide range of industrial applications.

The massive consumption of silver for photovoltaic panels due to the new growth phase for U.S. electricity demand.
Many are Still Woefully Unaware of the Value of Precious Metals
If someone came up to you and offered you a bar of chocolate or a 100 oz bar of silver, which would you choose? For investors aware of the value of precious metals, that’s a pretty easy no brainer.