facebook
back to top
Ask The Expert

Banks Are Buying Gold & Silver —Should You Follow? | Ronnie Stoeferle

ronnie and craig in ask the expert episode of jan 2024

Did you know you can get the Sprott Money Monthly Wrap-Ups, Ask The Expert, 

special promotions and insightful blog posts sent right to your inbox?

Sign up to the Sprott Money Newsletter here.

In this episode of Ask the Expert by Sprott Money, Craig Hemke sits down with Ronnie Stoeferle, fund manager at Incrementum, to discuss gold, silver, and the evolving global economy. Topics include the gold price surge, central bank demand, U.S. debt, Fed policy, and insights into mining shares. Ronnie shares predictions for 2025 and how emerging markets are reshaping commodity trends. Don’t miss this in-depth analysis! 

Craig Hemke (00:00)

Welcome back from SprottMoney.com. We are now into January 2025. It is time for your Ask the Expert segment. I'm your host, Craig Hemke. Joining me this month is my old friend Ronnie Stoeferle. Ronnie is a fund manager at Incrementum in Switzerland. Where are you guys based again, Ronnie? Is that right? I can't seem to keep it straight. Anyway.

Ronnie Stoeferle, IGWT Report (00:37)

At least.

Craig Hemke (00:43)

You'll also recognize Ronnie. He and his team put out the tremendous "In Gold We Trust" report every May—must-reading for everyone in the gold space. I know most everybody that's a mover and shaker in the gold space reads it. Ronnie, thank you so much for taking some time to join me this month.

Ronnie Stoeferle, IGWT Report (01:04)

Is it already too late to say Happy New Year? No, it's not. So, Happy New Year!

Craig Hemke (01:07)

I don't think so. It's mostly happy so far. Hey, I want to remind everybody that at Sprott Money, there are always great deals on physical metal. Big news recently: they’re now storing metal at two new sites in the U.S. for U.S. customers. It’s always hard to feel completely comfortable and trustworthy toward bullion dealers, but you can certainly feel that way with Sprott Money. And if you want to store the metal, they will do it in a very efficient and cost-effective manner. Now storing in Dallas and Salt Lake City. So, go to SprottMoney.com and check it out.

Ronnie, let’s talk about the "In Gold We Trust" report. It’s coming out in just four months. Looking back at what you wrote last May and how the year unfolded, what played out as you expected, and what didn’t?

Ronnie Stoeferle, IGWT Report (02:12)

Well, I think our gold call was pretty accurate. Based on our model introduced in 2020, we forecasted the closing price of gold to be around $2,660. Early on, people thought that was way too ambitious. But according to Bloomberg, I was the most accurate forecaster for gold. The report was called "The New Gold Playbook," highlighting how gold trading has changed.

For instance, the correlation with real interest rates has shifted. We haven’t seen much ETF inflow from the Western world, which has traditionally been a reliable indicator for gold prices. Instead, emerging market demand, driven by central banks and private consumption, has become the key driver. This has been accurate.

What we didn’t get right, or were perhaps too early on, was the mining space. Miners didn’t outperform gold last year, and silver didn’t show as much momentum as we expected. My take is that while being bullish on gold isn’t super contrarian these days, we’re far from the top of this bull market. I’d say we’re in the middle of it.

Craig Hemke (04:27)

Let’s break it down. Starting with the U.S. economy and the Fed. I’ve called it "the end of the Keynesian experiment." We’re already $700 billion into additional deficit spending in just the first three months of the new fiscal year. Where do you see the U.S. economy, Fed policy, and rate cuts heading? And how will this impact the gold market?

Ronnie Stoeferle, IGWT Report (05:04)

It’s going to be quite a ride. Between the election and the inauguration, much was written about what Trump might do. It’s going to be wild—not just for financial markets but globally. It’s not about right versus left anymore; it’s accelerationists versus bureaucrats.

Trump’s second term differs significantly from his first. Issues like immigration and inflation are front and center. Economic growth was minimal in 2016, and inflation wasn’t an issue then. But this time, the debt situation is more dire. The U.S. adds a trillion in debt every three months. There’s limited room to cut expenses since so much is fixed.

Craig Hemke (06:19)

Let’s pivot to the gold price for 2025. I underestimated the impact of central bank demand last year. It felt like every dip was bought, creating a physical floor under the price. Do you agree, and do you think this trend will continue?

Ronnie Stoeferle, IGWT Report (11:33)

Yes. Central bank demand has been a record for three years running. In 2024, gold saw 27% performance in USD, 35% in EUR, and 41% in JPY. Instead of focusing on gold rising, think of fiat currencies devaluing. It’s significant.

Gold’s strength in a tough environment—with U.S. Treasury yields at 5% and a stronger dollar—is impressive. I expect a consolidation phase for gold in the coming weeks, but this is a sign of strong buying power waiting on the sidelines. Weakness in the dollar, more rate cuts, and a revival of Western investment demand will be key triggers.

Craig Hemke (15:04)

Let’s talk about silver. It underperformed gold last year but is off to a good start in 2025. What’s your outlook for silver this year?

Ronnie Stoeferle, IGWT Report (15:38)

If Western investors return, they might find gold pricey and shift to silver. Unlike gold, silver hasn’t reached its nominal all-time high. Demand from the solar industry is driving growth, and new battery technologies may require more silver. My view is that gold leads, and then silver follows. 2025 could be a big year for silver.

Craig Hemke (18:29)

How about mining shares? Gold was up 26% last year, but miners didn’t deliver leverage. Even major miners like Newmont and Barrick were flat or down. What will it take for mining shares to outperform?

Ronnie Stoeferle, IGWT Report (19:34)

The big two—Newmont and Barrick—need to perform better to attract institutional money. Despite strong fundamentals, the sector lacks new capital. Cost inflation seems under control, with record free cash flows for many companies. But for generalists to enter, the large caps need to lead.

Craig Hemke (26:03)

Ronnie, you’ve got four months until the next "In Gold We Trust" report. We’ll be looking forward to it. For everyone, bookmark ingoldwetrust.report and keep an eye out in May. Thanks for joining us, Ronnie.

Ronnie Stoeferle, IGWT Report (26:43)

Thanks, Craig. We’re already hard at work. Feel free to reach out with ideas for the report. Always great talking with you.

Craig Hemke (28:19)

Thanks, Ronnie. Keep an eye on this channel for more from Sprott Money. Like and subscribe to stay updated. Have a great day, everyone!

Don’t miss a golden opportunity.

Now that you’ve gained a deeper understanding about gold, it’s time to browse our selection of gold bars, coins, or exclusive Sprott Gold wafers.

About Sprott Money

Specializing in the sale of bullion, bullion storage and precious metals registered investments, there’s a reason Sprott Money is called “The Most Trusted Name in Precious Metals”.

Since 2008, our customers have trusted us to provide guidance, education, and superior customer service as we help build their holdings in precious metals—no matter the size of the portfolio. Chairman, Eric Sprott, and President, Larisa Sprott, are proud to head up one of the most well-known and reputable precious metal firms in North America. Learn more about Sprott Money.

Learn More
about-sprott-skyline
Head shot of Craig Hemke

About the Author

Our Ask The Expert interviewer Craig Hemke began his career in financial services in 1990 but retired in 2008 to focus on family and entrepreneurial opportunities.

Since 2010, he has been the editor and publisher of the TF Metals Report found at TFMetalsReport.com, an online community for precious metal investors.

*The author is not affiliated with, endorsed or sponsored by Sprott Money Ltd. The views and opinions expressed in this material are those of the author or guest speaker, are subject to change and may not necessarily reflect the opinions of Sprott Money Ltd. Sprott Money does not guarantee the accuracy, completeness, timeliness and reliability of the information or any results from its use.

no_comments

Looks like there are no comments yet.