Mike Fagan,
Editor
Dec. 27, 2024
Well, that all but puts a shiny red bow on a very memorable and profitable 2024.
Gold had an absolute banner year, rising from US$2,000 an ounce to all-time highs near US$2,800 before settling in at the US$2,600/oz range. Silver, in typical fashion, followed suit — rising from US$22/oz to nearly US$35 before retreating to the current US$30 level.
Green energy metals like copper, uranium, and lithium struggled to find their footing throughout the year, much like the petroleum sector.
PGMs such as platinum and palladium traded in whipsaw fashion basically from January to December, giving traders little indication as to their overall direction going into 2025.
In terms of the US Dollar, the greenback has only been stronger than it is right now four times since the infamous 1985 Plaza Accord where the world’s leading trading nations joined forces to devalue the world’s reserve currency.
Hence, it’ll be very interesting to see which way things go dollar-wise with the new administration coming in in January.
On the one hand, President-elect Donald Trump would love to see a weaker dollar to kick off his second stint in the Oval Office as a strong dollar is seen as a headwind for domestic manufacturers.
Yet, a forward-looking market is already betting that Trump’s fiscal policies and his promised tariff war with China, Canada, and Mexico will mean an even stronger dollar ahead.
The greenback is already up some 5% versus developed trading partners and 4% against emerging nations since the start of October when Trump’s thrashing of the Democratic party began getting priced in.
Trump is inheriting a scorching hot economy that already has the Fed tempering its expected rate cut pace for 2025.
In maintaining the greenback’s global reserve currency status — something Trump has long been a staunch supporter of — and with plans to cut taxes and boost domestic oil and gas production, what’s likely on the horizon is stronger US growth, higher US productivity, and, hence, a very strong dollar for the foreseeable future.
In lock-step with a tempering of rate cuts, a heated economy could also put a bit of a lid on commodity prices such as gold, silver, and copper for at least the first few quarters of the new year.
It’ll be interesting to see what kind of fiscal balance Trump’s pick for treasury secretary, former Soros investing chief Scott Bessent, will be able to strike.
Bessent is a strong advocate for deficit reduction and deregulation and will no doubt be forced to run everything by Trump DOGE-man Mr. Elon Musk. Strange days indeed are coming!
One thing you can pretty much set your watch to will be an initial focus on massive spending cuts and shifts in existing taxes designed to offset the looming cost the Trump tax extension will add to the federal deficit, which is already fast-approaching US$2T.
All while reining in consumer prices… by far the #1 demand-list item for nearly all Americans as we turn the page on the Biden administration.
Bessent has also said he views tariffs as a “one-time price adjustment” that can be layered in and “not inflationary” and that tariffs imposed under Trump would be directed primarily at China. Trump, of course, has proposed a whopping 60% tariff on goods from China starting “Day-1” and smaller tariffs of around 20% on Canada and Mexico.
We’ll see how that all plays out.
We’re definitely entering what will be a climate of decreased market regulation, and that includes cryptocurrencies.
To that end, we saw a huge runup in the Bitcoin price in Q4 following Trump’s landslide victory. The BTC price raced from about US$60K to over US$106K per coin in just eight weeks before pulling back to the current US$94K level.
Our in-house crypto expert Chris Curl of Crypto Cycle fame has his eye on a number of smaller, lesser-known crypto opportunities he believes are poised to rise exponentially no matter what direction Bitcoin heads in the new year.
And our own Gerardo Del Real of Junior Resource Monthly just released a feature-length video on his #1 pick for copper-gold exposure in 2025… a presentation you definitely do not want to miss.
And while a strong dollar could keep metals prices somewhat in-check as we kick off the new year, the level of greenfields Cu-Au-Ag exploration getting done in this emerging mineral belt in particular could mean very significant gains for those positioned ahead of the drill-bit.
As we bravely enter 2025, we’re reminded of Neil Howe’s Fourth Turning to expect the unexpected.
Trump seems even more enamored with his role as Agitator-in-Chief this second time around… something we’re seeing already with his slew of controversial cabinet picks along with his threats to seize control of the Panama Canal (which apparently is being run by Chinese soldiers), force the sale of Greenland, and annex Canada while anointing Wayne Gretzky as Prime Minister.
In the immortal musings of Jim Morrison, “Strange days have found us!” We’ll see you all next week as we break on through to the other side of 2024!
Yours in profits,
Mike Fagan
Editor, Daily Profit Cycle