FINANCIAL ADVISOR INSIGHTS: What Falling Gold Prices Tell Us About The Stock Market

FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors.

What Falling Gold Prices Tell Us About The Stock Market (Advisor Perspectives)

"At a most rudimentary level, equities are residual claims in the capital structure. Gold, on the other hand, expresses confidence in the financial system," writes Mark Ungewitter of Charter Trust Company in Advisor Perspectives. "Confidence in banks, currencies, governments and Wall Street seems necessary for a secular bull market in junior claims – i.e. common stocks – to occur."

"The behavior of gold, then, helps confirm the stock market’s secular trend. A sustained move in the S&P 500 above its 13-year range, corroborated by a sustained downturn in the dollar price of gold, would suggest the beginning of a new secular bull market."

S&P500 gold chart

Wealth Management Firms Want Advisors To Spend More Time With Clients (Financial Planning)

A new survey by Ernst & Young has found that wealth management firms want advisors to spend more time with their clients. 75% said they have initiatives to do just this.

"Approximately 75% of wealth management firms surveyed plan to invest in mobile tools to increase advisor collaboration and effectiveness. Larger firms said they would use mobile technology to deepen client relationships by providing greater access to information, while smaller firms plan to use mobile applications to introduce new products and services and increase sales.

"Proprietary tools used for data and interfacing with clients will also come under scrutiny."

What The Big Gold Sell-Off Looks Like On A Chart Going Back To 1792 (Macro Tourist)

This chart shows how big the sell-off in gold has been even when taking a historical perspective.

gold long term price chart

Jim Rogers: Like I Said, I Expect Gold To Go As Low As $1,200 (Business Insider)

The gold rout continues and gold prices have fallen to $1,352 an ounce. Jim Rogers said the sell-off was being driven by falling gold demand in India, chartists, Cyprus and Bitcoins.

"I have repeatedly babbled about $1200-1300, but that is just because that would be a 30-35% correction which is normal in markets," he told Business Insider. "But I am a hopeless market timer/trader." Rogers said he expects gold prices to fall further for the "foreseeable future" but expects "gold to eventually go higher over the decade."

Tommy Belesis Charged With Fraud And Intimidation (Finra)

Finra has accused Anastasios Tommy Belesis, CEO of at John Thomas Financial, and four other employees of fraud and intimidation. Finra alleges that John Thomas Financial (JTF) sold shares of America West Resources, Inc. (AWSR) "at the height of the price spike." But of the 15 customer orders received to sell over 1 million shares of America West, JTF just entered one.

"JTF and Belesis prevented the orders from being executed on the same day they were received and some customer orders were executed the following day or days after at prices grossly inferior to those obtained by the firm while other customer orders were not entered or executed at all. AWSR is now in bankruptcy and the customers' investments are virtually worthless.

"In addition, the complaint alleges that JTF and Belesis, through Misiti and Castellano, lied to the firm's registered representatives and customers about the reasons the customer shares could not be sold on Feb. 23, 2012, including that there was a problem with the clearing firm's trading systems, there was insufficient volume on that day to fill the orders, and the shares could not be sold because they were restricted under the Securities Act of 1933."

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