I know I've been focusing on this gold thing a bit too much, but living in Europe, and knowing what's going to happen to the dollar (and the world economy), two words keep coming to mind, over and over and over.
Safe Haven.
I'm hoping for a pullback to under $600 to load up a bit more on the yellow stuff. Charts above from Martin Weiss.
April 21, 2006
More on gold investment...
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Sounds good. Silver is my cup of tea. Load them up.
For comments on why there was a desperate act of manipulation of the commodity prices yesterday, read: http://www.financialsense.com/fsu/editorials/steer/2006/0420.html
This signals that prices will start to go out of control soon.
Dude, the 800/oz gold price in 1980 was not the norm....it was an extreme price spike.
And gold spent the next 20 years in morbid decline down to the 280 level. Of course, the gold-dealer propaganda was trying to scare people into more gold purchases because hyper-inflation was supposedly right around the corner.
This US bubble investing is getting scary. It's like playing musical chairs as the players race from bubble to bubble...
Or maybe more like rats on a sinking ship.
only concern i have that GLD still trades at a thin volume....selling could be an issue..
on the other hand, may family has generations of physical gold (jewelry)..i am already invested...
I would bet gold goes down from here..we will see
Gold and Silver are world wide monetary instruments that compete against the dominance of the US dollar. When one wins the other looses. It works like a se-saw at the playground. These metals are in very thin markets. My bet is on the precious metals side of the equation long term. If you diversify a little of your dollars to the other side it gives your dollars a nice bit of insurance. Most people hate to think that the dollar can shrink in value. So can the metals as we saw yesterday.
Tom
Gold is going up as the probability that the dollar will decline is high. The new FED chairman has a tough choice now:
1) Save the dollar => keep raising interest rates, so the confidence in the $ will remain high but then cause a hard landing on the housing market with a consecutive severe economic recession.
2) Save the housing market => lower the interest rates so the housing market will have a soft landing and hopefully the economy too. Since this is the easy way out the world will lose confidence in the US capability to repay the debts and the dollar will slide...how much is unknown.
Option 2 will save the economic system temporarily but it shows that the US does'n want to address their and the world's debt problem, so the only safe haven will be gold and silver.
Fed chairman Bernanke has already told us what he'll do -- he's going to flood the system with funny money to prevent any economic collapse. After all, that approach worked so well for the Weimar Republic, Brazil, and Argentina, shouldn't we give it a go here?
House prices are going to fall hard, but watch as Uncle Sam steps in to "help". I predict we'll see hundred year mortgages and 0% financing before this is over.
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