Todd Graf
Precious Metals Advisor
Todd Graf is a seasoned Precious Metals Advisor at Scottsdale Bullion & Coin. He has a decade-long career in finance, previously at Morgan Stanley and Vanguard. He is Series 7 licensed and has extensive experience in traditional and defensive assets, providing clients with solid investment strategies.
Damian White
Sr. Precious Metals Advisor
Damian White is a Sr. Precious Metals Advisor at Scottsdale Bullion & Coin. With a background in business and finance, he transitioned from real estate finance to focus on precious metals in 2016. Damian is dedicated to educating investors on the benefits of gold and silver, emphasizing the importance of wealth preservation and proper asset allocation.
The constant bombardment of news hasn’t slowed following the highly anticipated 2024 election. With President-elect Donald Trump poised to retake the helm, questions about the future economic, political, and geopolitical outlook are swirling.
In this week’s The Gold Spot, Scottsdale Bullion & Coin Precious Metals Advisors Damian White and Todd Graf discuss the current buying opportunities in gold, why a debt crisis might be around the corner, and how close the world is to an all-out war.
Gold Correction = Buying Opportunity
Gold prices were closing in on 40% gains for the year when the post-election slump set in. However, this is normal behavior for the precious metal. This sell-the-news dip has happened in six out of the last nine elections, and the yellow metal even slid ~11% after Trump’s first victory.
“This pullback is giving our clients, and other people looking to get involved in gold after such a tremendous run, a great opportunity.”
Damian White
Sr. Precious Metals Advisor
With gold prices shedding a few hundred dollars, major financial institutions are joining in “buy-the-dip” rallying cries. Goldman Sachs, Citi, and UBS have advised investors to use this softening of prices as a buying opportunity.
Fed Slows Rate Cuts
One of the most important economic events not discussed is the slowing of rate cuts. Nearly every market, from gold to stocks, had anticipated a series of rate cuts based on the Federal Reserve’s initial 50 basis point slash. However, following the election, Fed leadership cut the benchmark interest rate by 0.25 percentage points. Fed Chair Jerome Powell said the group is in no “hurry” to cut rates further, and signals suggest the rate cuts will be shallower throughout 2025.
The Fed was forced to tame their initially aggressive rate cuts following a steep rise in the bond market. As the biggest debt market and asset class in the world, bonds are often used to gauge the health of the US economy. Lately, the bond market is rising at nearly the same rate as the interest rate cuts, suggesting that inflation hasn’t subsided.
The bond market is forcing the Fed’s hand, saying inflation is still here.–
Also, recent reports on the Consumer and Producer Price Indexes indicate that inflation is still high above the target of 2%, slowly eating away at Americans’ buying power.
Debt Crisis in 2025?
Investors weren’t the only people looking forward to steep interest rate cuts. Lower rates make the federal government’s debt payments more affordable. However, the Fed’s plan to slow down cuts will make it even more expensive to service the mammoth $36 trillion US national debt, which already costs more than the defense budget.
It feels like we’re setting up for a potential debt crisis by the first or second quarter of next year.–
The financial fallout of a debt default wouldn’t be confined to the US budget. All traditional, dollar-linked markets would eventually be negatively impacted. Many investors aren’t prepared for this potential, with the post-election honeymoon phase still in full effect.
Geopolitical Tensions Flare
Another crucial development is rising geopolitical tension, most notably in Ukraine. Both sides are ramping up their efforts to bring about a quick end as the war surpasses its 1,000th day. This grim milestone was marked by Ukraine launching long-range US missiles deep inside Russia.
In response, Russian President Vladimir Putin lowered deployment requirements in the country’s nuclear doctrine. Many European countries are preparing their citizenry for a potential war with brochures outlining how to survive such an event. At the same time, the war in the Middle East flares up as the International Criminal Court (ICC) releases controversial arrest warrants for Israeli Prime Minister Benjamin Netanyahu and former Defense Minister Yoav Gallant.
Gold is on Sale!
Gold’s current dip is a welcome buying opportunity for those looking to get into the yellow metal at lower prices. Given the dismal economic situation and rapidly increasing geopolitical tensions, many experts expect gold to soar higher throughout 2025.
The gold market is on sale right now.–
If you’re not in a position to add to the stockpile, holding the line is a smart move. Have any questions about the current market or investing in precious metals? The advisors at Scottsdale Bullion & Coin would be happy to help. Give us a call toll-free at 1-888-812-9892 or using our live chat function.
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