On the edge of a bigger event like 2008This time around maybe people will divert some of their current portfolio position (10-20%) into junior gold juniors for a quick rebound as we are at the lowest level since many years. There is something big coming and only fallback position will give protection to this earthquake.
it could be time for juniors stock... Glta
How Does 'Average Joe Investor' Get Insurance Against a Collapse?
As you can see, the speculation regarding exactly how much exposure banks have to potential losses, due to this oil price collapse, varies. Nevertheless, the sum is consistently in the trillions of dollars...
The somewhat unregulated nature and consistent growth of the derivatives market, specifically in respect to oil, cannot be ignored. This market has the potential to trigger the next financial crisis. If oil prices don't rebound within a few months, many industry professionals believe the crisis will take hold.
If another bailout by the taxpayer was to take place at the behest of banks making risky bets on oil, look out. Aside from the civil unrest that could follow, citizens of America may lose what little faith they have left in the nation's fiscal and monetary policy - ultimately leading to a crisis of confidence in the entire banking system.
If this occurs, and we truly hope it will not, a rush to long-standing safe havens, such as gold, will ensue (recent market action suggests it may already have started). With US banks likely to be at the center of this potential crisis, and north of $5 trillion already on the Fed's balance sheet, a large stimulus would fail to strengthen the USD as it did in 2008.
Gold is up roughly 9% since Christmas, by the way...