The Bright Future of Gold: A Valuable Investment in Uncertain Times
Despite its historical allure, gold's dominance as a safe investment is being challenged in 2021, leaving cautious investors seeking alternative havens
Gold is encountering strong competition in 2021 as the favored safe haven for prudent investors.
Gold prices closed at $1,831.80 per troy ounce on Thursday, marking their lowest level since March. This decline in price has been occurring over the past few months, and it has intensified in recent weeks due to the surge in bond yields and the strengthening of the dollar. When bond yields are high, investors typically favor government bonds over gold as they provide regular coupon payments. Additionally, the increase in the value of the dollar makes it more expensive for foreign investors to buy gold, which is priced in dollars.
Gold prices soared to nearly record levels earlier this year, driven by the collapse of multiple regional banks in the US and persistent inflation. Investors sought solace from market instability by turning to gold, with hopes that a banking crisis would prompt the Federal Reserve to veer away from their campaign to raise interest rates. This shift in policy was anticipated to further stimulate interest in gold.
However, the banking sector has since stabilized and the US labor market and economy have proven remarkably resilient amidst the Federal Reserve's history-making cycle of interest rate hikes. Consequently, concerns have arisen that the central bank may maintain higher interest rates for an extended period of time.
The Fed's indication in September of a potential rate hike before the end of the year and maintaining higher rates until 2024 has resulted in US Treasury yields reaching their highest point in over ten years. This has also led to a surge in the value of the dollar, resulting in negative impacts on the price of gold and the shares of precious-metal mining companies. Over the past three months, Barrick Gold shares have declined by 11%, Kinross Gold has seen a 3% slide, and Northam Platinum has experienced a significant drop of 22%.
The SPDR Gold Shares exchange-traded fund, a popular fund tracking performance of physical gold, has declined 5% over the same period.
Still, not everyone is saying good riddance to gold.
Costco frequently experiences high demand for its one-ounce gold bars, often selling out within hours after restocking on their website, according to Richard Galanti, the company's CFO. Surprisingly, Costco is indeed involved in selling gold bars. In light of this, Matt Dmytryszyn, the Chief Investment Officer at Telemus, predicts that gold prices will hover between $1,700 and $1,900 in the next six months. Telemus holds a small position in an exchange-traded fund that possesses physical gold bars, which they intend to retain as a safeguard against interest rate uncertainties.
"Theres always the risk of some unexpected event happening," he said.
Why nursing schools are turning away thousands of applicants
Last year, the American Association of Colleges of Nursing, which represents nursing schools with baccalaureate and advanced degree programs, reported that approximately 78,200 qualified applicants were denied admission. This comes at a time when registered nurses are participating in strikes to protest staffing shortages, as reported by CNN's Tami Luhby.
There were nearly 66,300 applications received for entry-level bachelor's degree programs, with a higher number of applications being turned away from baccalaureate programs in recent years compared to before 2019. (Note: One person may apply to multiple schools.)
The main reason why nursing schools cannot accept more students aspiring to become registered nurses is due to staffing shortages. These programs are faced with a shortage of faculty, limited clinical placements for students, and a lack of preceptors to supervise the students during their rotations at healthcare providers. State nursing boards often set strict limits on the number of students preceptors can oversee.
"You cant just throw in a lot of people to expand nursing pools," said Judith Jarosinski, professor emerita at Salisbury Universitys School of Nursing in Maryland.
Read more here.
The Girl Scouts are discontinuing a cult-favorite cookie
The Girl Scouts are discontinuing a popular cookie just a year after its debut sparked a frenzy, reports my colleague Jordan Valinsky.
Girl Scouts of the USA has announced that Raspberry Rally will not be available for sale during the upcoming cookie-sales season, which takes place from January to April 2024. Introduced as a "sister" cookie to the popular Thin Mints last year, Raspberry Rally featured a bright pink berry-flavored cookie coated in the same chocolate as its sibling. This cookie was exclusively sold online, marking the Girl Scouts' first-ever online cookie offering. The organization implemented this strategy to foster the development of girls' e-commerce sales and entrepreneurial abilities.
Demand sparked a surge in online shopping, causing certain chapters to run out of the $5 boxes within a day. Resellers took advantage and offered the Rallies for as high as $30 per box on eBay. The organization did not divulge the quantity of boxes they had produced.
"In light of the immense popularity of Raspberry Rally last year, we have decided to temporarily prioritize the availability of our classic varieties," stated the Girl Scouts of the USA in a response to CNN.
Read more here.
