Silver has quietly out-performed gold and the other precious metals – and most other commodities – so far in 2016. Here is a table outlining the eight most (and least) profitable commodities so far in 2016:
Year-to-date Performance (through September 16)
Top-Performing Commodities Worst-Performing Commodities
Sugar +48.37% Oats -22.92%
Orange Juice +35.75% Rough Rice -20.78%
SILVER +35.15% Wheat -20.54%
GOLD +23.11% Feeder Cattle -17.01%
Palladium +19.77% Lean Hogs -15.43%
Lumber +16.08% Live Cattle -13.56%
Natural Gas +15.36% Corn -12.01%
Platinum +13.84% Cocoa -11.86%
Silver rose 50% in the first seven months of 2016, rising from $13.82 at the end of 2015 to a peak of $20.71 on August 2. Silver traded over $20 for most of July and August but has since dipped below $19. Silver tends to vacillate in much wider swings than gold due to its smaller market volume (vs. gold). That means that any small increase in silver investment demand can generate large percentage gains in silver.
Gold Closes Down For The Week
Gold closed down for the week, along with most other commodities, due in most part to a surge in the U.S. dollar. Crude oil prices fell to $43. The rest of the commodity universe – including grains, meats, industrials and soft commodities – are also at or near the low end of their recent trading ranges. Nearly all commodities are universally quoted in U.S. dollar terms, so when the dollar rallies, commodities tend to fall. However, the Wall Street Journal’s U.S. dollar index is still down slightly (-3.37%) year-to-date.
Due to sub-par U.S. economic growth, the Federal Reserve is NOT expected to raise rates this week (on Wednesday). The possibility of a rate hike, as calculated by the fed-fund futures market, dropped to 20% last Friday, down from 30% at the same time a week earlier. We’ll know the Fed’s decision soon, as the Federal Open Market Committee (FOMC), convenes eight times a year, this time on September 20-21.
One Final Comment…
Last week, I recommended a column by Peggy Noonan on the heroes of 9/11. This week, she has done it again in her weekend column in the Wall Street Journal, “Travel Back to an Early Clinton Scandal,” about the Travelgate firings in 1993, when Hillary and Bill were in their first few tumultuous months in the White House. Similar scandals have followed Hillary for almost 25 years now. I am no fan of some of Trump’s antics either. I wish the disappointing Libertarians had a podium at the debates, but they have been shut out once again. Over the next few weeks, we will be exploring what a new controversial President could mean for gold and silver prices. I welcome your predictions. Email me at MikeFuljenz@MikeFuljenz.com.
Metals vs. Markets
Metals vs. Markets Prices on:---- Change vs. January 1 Prices in 2000-08 ---
Metals: End-2015 September 16, 2016 2000 2005 2008
Gold $1,060 $1,305 +23.1% $290 (+350%) $437 (+199%) $836 (+56%)
Silver $13.82 $18.68 +35.2% $5.34 (+250%) $6.78 (+176%) $14.76 (+27%)
Stocks: End-2015 September 16, 2016
Dow 17,425 18,124 +4.0% 11497 (+58%) 10021 (+81%) 13265 (+37%)
S&P 2,044 2,139 +4.7% 1469 (+46%) 1148 (+86%) 1468 (+46%)
Mike Fuljenz is the Official Precious Metals Expert for Townhall