Market insights and analysis

How dynamic, risk-managed investment solutions are performing in the current market environment

2nd Quarter | 2022

Market insights and analysis


Updates on how dynamic, risk-managed investment solutions are performing in the current market environment.

Gold prices remained between their 50-day and 200-day moving averages, closing last week at $1,849.90 per ounce.

Supply chains are now facing another challenge—something most of us didn’t even know was critical. High Plains Journal, an agricultural news publication, reports, “… A new wrinkle stemming from the war in Ukraine … could prevent diesel vehicles from running, whether they have fuel or not. After trade between Russia and the rest of the world was cut off, the many industries that rely on urea are in tough spots.

“Apart from its use as fertilizer, urea is also a key ingredient in Diesel Exhaust Fluid (DEF). … DEF is used in all diesel vehicles manufactured since 2010, which includes trucks, tractors, buses, RVs, and other vehicles the world relies on for agriculture production and transportation of people, food and other goods.

“In 2019, Russia exported 6.98 million metric tons of urea, and was the No. 1 exporter by a wide margin. … DEF is made of 67.5% distilled water and 32.5% urea and was designed to reduce environmental impacts of diesel vehicles. It is injected into the exhaust stream … and without it, these vehicles will not run.”

This DEF shortage could produce massive supply-chain emergencies. If tractors can’t start, food harvests could be severely limited; and if trucks can’t roll, it will be very difficult for food, medicine, and other necessities to be transported across the country. These are unprecedented times. Fortunately, gold has historically proven to be a “safe haven” during volatile times.

Rick Andrews is president of Avant Capital Management.

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