Gold And Silver Are The Answer!

Happy 4th of July! Gold and silver are the answer!  Figuring out the question is a little more difficult.  We are in the beginning of a currency crisis and time is running out.   Protect your wealth, by buying gold and silver while they are at bargain prices.  If on the other hand you believe in “fairy tales”, put your money in the U.S. Dollar.

Here we are on the eve of the fourth of July and what are we celebrating?  Certainly not the economy and certainly not an increase in our freedom.  If anything on this 3rd of July 2009, we are witnessing what President Obama predicted, the “beginning of the end”.  The statistics revealed this week in the jobs numbers reveal that the world’s largest economy remains mired in a deep recession, and that the stimulus package has been anything but  stimulating.  Another 467,000 jobs lost in spite of the Community Organizer in Chief’s  plan for “shovel ready projects .”  This figure was far greater than the 325,000  the experts had predicted. The Community Organizer in Chief had predicted 10% unemployment as a possibility, but I’m sure even he did not expect 9.5 percent to arrive this soon!

The U.S. In Distress!

Could it be that he wants this crisis to continue in order to”Europeanize” the U.S. before anyone knows what he is doing?  Call me crazy, but that is exactly what I think he is doing.

Remember what prominent Democrats said earlier this year?  The White House Chief of Staff, Rahm Emanuel, let the cat out of the bag when he said,  “You never want a serious crisis to go to waste  and what I mean by that is an opportunity to do things that you didn’t think you could do before.“ That is the one  good thing about Neo Marxists, their ego will not let them remain silent about their intentions!

Here we are, before the 4th of July, contemplating the largest budget deficit in our history without seeing any response in the economy (except for the increase in the size of government and the increase in the taxpayers indebtedness),  looking at both barrels of the cap and trade scheme, which is the largest tax increase in U.S. history, while staring at the end of the best health care system in the world.  Who’d of thunk it just 9 months ago?  At least we can drive to the government clinic and be told that we are not worth the investment of the people’s money, in a Government Motors  car!  The founding fathers knew this day would come and fortunately for them they did not live to see it!

This week brought pre-4th of July fireworks to gold market, but not much substance as the market was whipsawed by the dollar, or rather the news there of.

Gold Drops Below $930

Nick Vinocur and Jan Harvey

LONDON — Reuters Last updated on Thursday, Jul. 02, 2009 09:56AM EDT

Gold (GC-FT929.40-11.90-1.26%) fell below $930 (U.S.) per ounce on Thursday as the U.S. dollar rose versus a basket of currencies after a larger than expected dip in U.S. non-farm payrolls, which prompted some buying of the currency as a haven from risk.

The euro also extended losses against the dollar after European Central Bankchief Jean Claude Trichet said euro zone activity was likely to be weak for the rest of the year.

Spot gold fell to a low of $926.10 and was at $930.40 at 1319 GMT, versus $939.95 late in New York on Wednesday.

Today’s payrolls surprised most market expectations, and the dollar rose as a result, said Pradeep Unni, senior analyst at Richcomm Global Services. However, the data is not likely to have a long term impact on the (gold) market.

The immediate slide in gold seems to be more because (of the) panic selling that got triggered from currency markets and stock markets, he said.

U.S. employers cut 467,000 jobs in June, far more than expected, while the unemployment rate rose to 9.5 per cent.

The worse-than-expected data spurred safe-haven flows into the dollar, making gold pricier for holders of other currencies.

Assets seen as higher-risk, such as equities and some currencies, slipped in the wake of the numbers. While gold is often seen as a safe haven asset, moves in the dollar are taking precedence as the metal’s main price driver.

Ongoing volatility in the currency markets is set to benefit gold, according to traders.

I expect gold to recover ground as people look for alternatives to currencies, said Simon Weeks, head of precious metals at the Bank of Nova Scotia. For the time being, though, we still remain in a $915-945 range.

Analysts said gold prices could see increased volatility after the data was released, as investors sought to close their positions ahead of a long weekend in the United States.

It’s possible we’ll see some very erratic price moves this afternoon, said Robin Bhar, an analyst at Calyon. It’s a long weekend and people will want to square up their positions.

Who knows at this point, I certainly don’t, but gold could touch the major uptrend line before the bull market resumes. That  would  confirm  the uptrend, but it could go lower than it is presently and still maintain a bull market.  Most major secular bull markets do test the major uptrend line at least once. The $880 mark in gold is a possibility, but I think we have seen the lows in the $900 teens.

The Coming Currency Crisis!

How do I put this gently?  We’re looking at a destruction our currency. We’re looking at the United States dollar no longer being the reserve currency of the world.  To put it in simple terms, we are looking at a currency crisis.  Gold will react as this crisis in the dollar deepens.

During a currency crisis, the one thing that you don’t want to be in is the currency that is cratering.  The U.S. Dollar is in the early stages of crisis so you need to find an alternative. The only viable alternative currencies that are available are gold and silver.  Take the time to preserve your assets with gold and silver!  Fore warned is fore armed.

China Allows Trade Settlement in Yuan in Hong Kong

By Nipa Piboontanasawat and Bob Chen

June 29 (Bloomberg)  China approved use of yuan to settle cross-border trade with Hong Kong, part of a drive to broaden the use of the currency and reduce reliance on the U.S. dollar.

Hong Kong Monetary Authority Chief Executive Joseph Yam said he hopes the first transactions will start next month after signing an agreement with People’s Bank of China Governor Zhou Xiaochuan at the city’s airport today. Zhou said the program would reduce foreign-exchange risks and transaction costs.

China is promoting greater use of the yuan in international trade and finance after Premier Wen Jiabao in March expressed concern that a weakening dollar will cause losses on holdings of U.S. assets. The greenback slumped on June 26 in New York after the People’s Bank of China renewed its call for a new global reserve currency to replace the greenback.

It’s an important step to make the yuan an international currency, said Fang Ming, an analyst in Beijing at Bank of China Ltd., the nation’s biggest foreign currency trader. In the long-term, the world reserve currency system will consist of several major currencies, including the yuan and the euro, instead of just the U.S. dollar.

The Dollar Index that measures the currency’s performance against six trading partners rose 0.4 percent today, after dropping 0.7 percent on June 26. Zhou told reporters in Basel yesterday that the nation won’t alter the composition of its $1.95 trillion in foreign-currency reserves suddenly. U.S. President Barack Obama needs the support of China as his government tries to spend its way out of a recession.

More happy news before we celebrate what’s left of our independence!  Maybe these are the “green shoots” that the media keeps talking about.

U.S. housing misery poised to enter new phase

Fri Jun 26, 2009 1:25pm EDT
By Herbert Lash – Analysis

NEW YORK (Reuters) – Signs that home prices may have bottomed have stirred hope on Wall Street that the economy is on the mend, yet tight credit and a new foreclosure wave cast doubt on any looming housing revival.

Sales of previously owned U.S. homes rose for a second straight month in May, realty data on Tuesday showed, while the U.S. government and Federal Reserve have designed a number of programs to alleviate a battered housing market.

However, the chief economist of the National Association of Realtors warned of the danger of a “delayed” recovery in housing, with prices down 32 percent nationwide from their peak three years ago.

Big risk factors that could spur more foreclosures include expectations of rising unemployment and the forecast resetting of interest rates on 2.8 million subprime and Alt-A mortgages in the next two years.

Delinquency rates on mortgage payments typically rise in tandem with unemployment, which is expected to top 10 percent after hitting a 25-year high of 9.4 percent in May. And when mortgages interest rates reset, they are typically at higher rates that can cause monthly payments to balloon.

And the hits just keep on coming. It would seem that we should be able to look to our leaders to help ease us out of this financial quagmire, but I forgot, we did not elect leaders, we voted for “change”.  This video from youtube.com is really very interesting.  I cannot vouch for it’s accuracy, but I think, even if the numbers are off, it is certainly pointing in the right direction!

More Gold Market Analysis:

• Silver Versus Gold
• Gold & Silver: With A Dose Of Caution
• Gold’s Warning Signs are Flashing!
• Buy Gold And SILVER Coins On Pullbacks!
• “Dead Man Walking”

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