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Ronnie Stoeferle Profile picture
@RonStoeferle
Mar 14, 2022 • 7 tweets • 6 min read • Read on X
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As the first rate hike of this new (imho very short) rate hike cycle is getting closer, let's have a look at the performance of the #USD, #commodities and #gold before and after the first hike:
Will the #USD rally? Not necessarily..

The period prior to a US tightening shows a rally in the USD but very often weakens in the 6-month period following the first hike....
What about #commodities? Consensus would tell us that raising rates will cause commodities to sell off.

Not really. ..The first rate hike proved to be close to the bottom for the 2015 cycle, and all cycles were higher a couple of months out...
Now what about #gold?

Pundits would say that higher rates should cause gold to sell off, but actually the first hike seems to be a consistent point to buy gold. Only the 1994 cycle saw gold end lower than the rate hike day - and even then, it was by a small amount.
...in the last hiking cycle, the day of the first hike exactly nailed the low in gold...
...while under Greenspan in 1999, gold made its lows only 3 weeks after the first hike and started a 12 year bull market...
Long story short: Don't fear the first rate hike, rather buy it...

ht @kevinmuir and @IGWTreport

#gold #silver #federalreserve #ratehikes #powell #trapped #BTC #USD #commodities #selltherumourbuythefact

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More from @RonStoeferle

Ronnie Stoeferle Profile picture
Dec 5, 2024
Why Gold Remains the Cornerstone of Global Reserves: a little #thread...

1/11 Most major central banks still hold a significant percentage of their reserves in gold. Let's dive into the gold reserves dynamics! 👇Image
2/11 Recent gold purchases have largely come from emerging markets. These nations are bolstering their reserves amidst global economic shifts. Image
3/11 Despite this trend, developed nations still hold significantly more gold—both in absolute terms and relative to their total reserves. 📊 Image
Read 12 tweets
Ronnie Stoeferle Profile picture
Aug 13, 2024
The Optimal Gold Allocation: A Deep Dive into Recent Research

A big #Thread on #Gold: 🧵
1/ What's the ideal gold allocation?

A recent ARC survey () highlights that 75% of managers surveyed have minimal to no gold exposure, with none exceeding 10%.

These results echo a Bank of America study, showing that 71% of US advisors allocate less than 1% of their portfolios to gold. This lack of interest extends to gold mining stocks, which have lost favor with investors due to poor performance.ftadviser.com/asset-allocato…Image
2/ Why should you consider gold?

Research by Van Vliet and Lohre () shows that including gold in your portfolio can significantly reduce downside risk. For investors with a 10-year horizon, the optimal gold allocation is around 13%.papers.ssrn.com/sol3/papers.cf…Image
Read 11 tweets
Ronnie Stoeferle Profile picture
Jul 9, 2024
Rethinking Traditional Portfolios
(in Today’s Macro Environment)

A little #Thread:
1/10 Traditional portfolios are still dominated by a 60/40 mix of equities and bonds. But is this strategy still viable in today's economic landscape? Let's dive in! 🔍 Image
2/10 Recent market trends have shown the vulnerability of both equities and bonds in a high inflation and rising interest rate environment. Commodities, however, have proven to be a robust hedge. In 2022, they delivered a solid 16.1% annual return! Image
Read 12 tweets
Ronnie Stoeferle Profile picture
Jun 27, 2024
The Old Investment Playbook Just Got Ripped Up

1/10 The fiscal situation in many countries is worsening due to persistently high budget deficits and rising refinancing costs.

Here is a quick #Thread on how the investment landscape has structurally changed! 💡Image
2/10 The US government finances have moved far beyond historical norms in recent years, especially post-Lehman. A clear illustration of fiscal dominance! Image
3/10 US consumers, especially lower-income segments, are increasingly living paycheck to paycheck. The savings rate is now at a low 3.2%, a level not seen since September 2008 pre-Covid! Image
Read 10 tweets
Ronnie Stoeferle Profile picture
Mar 26, 2024
Just finished reading the brandew "Gold Investing Handbook for Asset Managers" by the World Bank.

The 72 pages report is indeed well worth reading and can be downloaded here:


For your convenience, I have created a little #thread to sum up the highlights of the report:openknowledge.worldbank.org/server/api/cor…
“Because gold has multiple sources of demand and supply as compared to other major asset classes, its liquidity is less likely to dry up during times of market volatility.” #portfoliohedge #liquidity #stressliquidity
"Gold makes up around 18 percent of the total reserves of the central banks, while the share of the US dollar in total global reserves has declined from 71 percent in 2000 to 56 percent in 2022 (according to the IMF Official Foreign Exchange Reserves (COFER)), reflecting the push among public asset managers to diversify their foreign reserves as their safety and capital preservation objectives became more difficult to achieve through investment in traditional assets and currencies, given the negative real yields environment." #Dedollarization #HeelTurn
Read 14 tweets
Ronnie Stoeferle Profile picture
Jan 7, 2023
It seems that #Zoltan has been quite busy lately!

The newest, already 5th part of his "War"-series, was published on January 6th.

In this little #thread i've summarized some of the highlights of his piece "War and Peace:

🧵
"... four “war” dispatches last year: War and Interest Rates, War and Industrial Policy, War and Commodity Encumbrance, and finally, War and Currency Statecraft. In these, I identified six fronts (..) in “macro-land” () where Great Powers were going “at it” in 2022:
"the G7’s financial blockade of Russia, Russia’s energy blockade of the EU, the U.S.’s technology blockade of China, China’s naval blockade of Taiwan, the U.S.’s “blockade” of the EU’s EV sector with the Inflation Reduction Act,
Read 35 tweets

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