It isn’t every day that you hear someone in the mainstream financial media talk about gold. When they do, it’s often in a pejorative manner. So to hear someone in the financial media talking about gold reaching $1,700 or $1,800 an ounce is quite uncommon. And the fact that the person making those statements is none other than Jim Cramer is even more astounding.
Cramer is well known as a former hedge fund manager and current TV personality. His TV show is focused heavily on stocks, with Cramer often expounding upon which stocks he thinks are good buys. He’s so bullish on stocks that many analysts joke about him and his permabull stance towards stocks. That’s one reason it’s so shocking to hear him talking about how well gold should be doing.
According to Cramer, stock markets should have fallen far further than they actually did after news broke of the death of Iranian general Qasem Soleimani. Cramer understood the possibility of war with Iran and the implications that a war would have for markets. And that’s why he understood why so many investors were rushing to buy gold.
Cramer’s gut feeling was that the rush to buy gold was indicative of fear among investors, which would naturally send them fleeing to gold. And because of that fear, Cramer though that stocks should have fallen further, and gold could very well end up at $1,800 an ounce.
That’s refreshing to hear such an honest take on what markets should be doing. The fact that stock markets continue to remain elevated even in the face of Iranian missile strikes is puzzling, and not just to Cramer. No one in their right mind would get into stock markets that are at all-time highs at a time when a major war in the Middle East is on the verge of kicking off. The only conclusion that we can reach is that machine traders, algorithmic trading, and corporate stock buybacks are keeping stock markets buoyed, because all the normal people are getting out while the getting is still good.
Image: Tulane Public Relations
This article was originally posted on Goldco.
