Will the Coronavirus Force China’s Hand on Gold?

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Written by Mike Hammer

China is facing quite a predicament now.  Overnight the World Health Organization (WHO) declared that the coronavirus outbreak has reached “global emergency” levels. That makes it official folks; this is an actual big problem now.

The parameters of the situation are being refined every day.  Your friendly Gold Enthusiast, who majored in mathematical modeling of business in his undergrad years, of course, loves numbers and models. According to the best online sources (WHO etc), the important numbers for this situation are incubation period 5 days (how long after you actually “catch” the virus before you show symptoms); a 34% rate of contracting the disease if you are a carrier; and a 2% chance of dying if you contract the disease. The R-zero number – how many people each carrier infects – is currently set at 2.2. Of course, all of these are estimates and are subject to change at any time.

Those are some hard numbers. A lifetime of working with models taught this grizzled head that numbers define or describe situations, but it’s the results of situations are what drive markets.

So what are the likely results, and that will affect the price of gold since that is the focus of The Gold Enthusiast writings? We can look at the changes happening, peer down the chain of related events, and see what outcomes we can discern.

One big change… Continue reading at ETF Daily News

About the author

Mike Hammer

Mike Hammer has had a wide-ranging career, with trading and investing as continuing themes. Mike graduated with a business degree and spent years as a financial advisor, before moving to New York and to pursue a career in IT and education. For more than a decade Mike has been working with the Adam Mesh Trading Group as a stock market and commodities mentor. He’s trained over 200 individuals, spoken at several national conventions, and is a frequent contributor to educational webinars.

Mike writes The Gold Enthusiast daily newsletter, runs the Golden Hammer trading service, and participates in the Mesh Private Portfolio. He also keeps a position in international education which keeps him in touch with "the student mindset".

Mike focuses on the precious metals markets, the energy industry, and the financial sector. His motto is "Plan your trade, then trade your plan!"

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