The Blanchard Economic Report

As the New Year takes hold, concerns over global geopolitical instability have moved to center stage.

“This year marks the most volatile political risk environment in

the postwar period.” –  2017 Outlook Report from the Eurasia Group

Gold has climbed 5.89% since Dec. 15. The price of gold is already rising ahead of the Jan. 20 Inauguration as smart money investors buy physical metal to hedge against the numerous uncertainties around the globe.

Here are 6 risks smart money investors are concerned about in 2017…

Military Risks…

Trump has promised to “bomb the hell out of ISIS,” extend surveillance capabilities, and otherwise leverage US coercive power to punish enemies, the Eurasia report notes.

Instability in Europe…

The continent faces a series of elections from France to Germany and the Netherlands. A wave of populism is sweeping across not only America, but Europe and this year’s elections could destabilize the European Union.

Domino Impact of Rising Russian Influence…

There are expectations that Russia could meddle in European elections this year with the goal of destabilizing the traditional power base. Trump’s tepid support of NATO could weaken the alliance that has historically protected global order.

China’s Power Grab…

Chinese President Xi Jinping sees the current unrest in America as an opportunity to seize greater power on the world stage. His recent speeches are calling for China to become the new leader in globalization.

Inflation is Rising in the US…

On the economic front in the United States, recent data shows the economy near full employment with the December unemployment rate at a low 4.7%.

Wage growth is accelerating as average hourly earnings climbed 2.9% on a year-over-year basis in December, as employers struggle to find qualified workers to fill positions. Central bankers are already warning about the potential for higher inflation in 2017…

Another Bank Crisis…

Former U.S. Treasury Secretary Lawrence Summers told Bloomberg that the president-elect’s plans for deregulation were setting the stage for the next financial crisis.

Is Your Portfolio Properly Diversified?

Investors are loading up on the both gold and silver at bargain-level prices following the steep price slide after the presidential election. Overseas buying has been strong in gold, especially from China ahead of the Chinese Lunar New Year on Jan. 28.

Study after study has shown that precious metals can reduce overall volatility and protect your assets against equity market declines.

Act now to ensure your portfolio is properly hedged and diversified…

Blanchard believes that gold and silver bullion in physical form is an appropriate asset for a small portion of any properly diversified investment portfolio. We will take the time to learn your investment objectives, investment time horizon and risk appetite before recommending products for your consideration. Call us today at 1-800-880-4653 for a confidential consultation with a portfolio manager.