Loading ...Crescat Capital Report – Interesting read.
A bit sensational but interesting perspective.
MAJOR MARKET THEMES:
- China credit collapse
- Record overvalued US equity market top
- Flight to safety into deeply undervalued gold, silver, and precious metals miners
CHINA: Wall Street came out in force today trying to calm its clients by saying that Evergrande is not China’s Lehman moment… It is much bigger than that.
Mises “There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.”
OVERVALUED MARKETS: There is a strong chance that the US equity market has already topped out as of Sep 2 …. US stock and credit market’s historic valuations are compliments of rampant speculation underwritten by the Federal Reserve. These asset bubbles are ripe for bursting. The catalyst is the dual combination of rising inflation in the US and a credit crisis in China.
PM VALUATIONS: We believe our portfolio of 90+ activist precious metals companies is worth 11 times where the market is valuing them today. That is at the current gold price. They are worth even more than that in a significantly rising new gold and silver bull.
Gold Wins whether Safe-Haven Flight or Inflation Hedge.
The Fed is expected to announce the taper tomorrow. A fully committed taper announcement would likely only further catalyze China’s credit collapse and the US equity downturn.
The odds are that gold has already fully priced in the taper based on its pullback over the last two months. If the Fed gives us the “soft taper”, it should allow gold to catch a huge bid and be off to the races.