It is Time for Gold Investing!

June 28, 2009 Gold Stocks, Physical Silver, Politics No Comments

It is time for gold investing as the world’s paper currencies are devalued. Gold is in limited supply and it’s price must rise as “quantitative easing” continues globally. Trader’s should use a portion of their gold stock profits to purchase gold and silver coins and bullion. It is definitely time for gold investing!

Last week it looked like $932 was the low for gold, but hey, who knew that Monday was coming! Monday brought a drop to $914 and change, then things turned around. Anyone who bought gold Thursday or Friday and then backed it up with more on Monday did very well. It is critical to ease in when buying gold dips and save some capital for lower lows. It works the same on the sell points. Try to have the discipline to sell, or buy, gold in groups of three in order to increase your chances of maximizing your profits.

AU 5Day 062609 It is Time for Gold Investing!

Gold presents us with a treasure trove of opportunity as spot gold touches the mid $914 level before turning up.

Price is the most important thing in the gold market! If the price of gold drops a little, buy a little. If price falls a lot, buy a lot. This will work for buying gold coins, gold bullion or gold stocks. “The times, they are a changing”. It is important to accumulate on all opportunities that are presented.

Governments Hell Bent on Quantitative Easing!

The current thinking by governments around the world is to maintain the stability of their banking systems at the expense of their currencies. Central governments are huge, slow and inefficient. There is no way that they will be able to remove the liquidity that “quantitative easing” has injected into the system. If they are smart enough to know when to start removing it, if that is even possible, they are way to big and slow to do it in a timely manner. The most likely outcome is that the politicians will continue on this inflationary ponzi scheme until hyper-inflation forces “change” on them.

It is my contention that the Obama administration knows full well the road that they are embarking on and that they intend to grow government at the expense of the people’s liberty. Their intent is to lower the U.S. standard of living to that of socialized Europe. Now before some of you go off the tracks, keep one point in mind. I don’t care what politicians say, I care about what they do and how they govern. President Obama and his minions are governing as Neo Marxists and it would behoove you to prepare for what is currently unfolding. If we had a government that was fiscally responsible, pro capitalism and shrinking the size of government, I would be urging you to sell gold and gold stocks on every upturn!

Let’s listen to what the President had to say a mere 5 months ago when he was President Elect.

What a difference 5 months makes! It looks like the world’s largest debtor nation is well on it’s way to becoming a bankrupt nation! Now we are looking at 1.8 trillion (if your dumb enough to take their estimate as accurate) of new debt before we even consider the government ruining our health care system. No new jobs have been created by the “must do immediately” stimulus package/ bailouts and now we must immediately fix the health care system before “it” brings down the economy. This is insanity!

Who can believe any estimates that come out of the political class? If we use the round figure of 50 million people uninsured, it would be better to give each one of them 1 million dollars in order to buy private health insurance for the rest of their lives. That is 500 million dollars and the problem is solved. The Obama (read: Neo Marxist) proposal is upwards of 2 trillion dollars for starters. But apparently the purpose of this bill is not to insure the uninsured, but rather it is to drastically remove our constitutionally guaranteed freedoms and to expand government. Is there no one out there who will stand up and say no? If you are counting on the Republicans, I can tell you that you will not get the outcome that you are looking for. Wake up! It is time to protect yourself form your “friendly government”.

It is Time for Gold Investing!

With that said, it is important to take steps to preserve your wealth while there is still time, by investing in gold and silver. As this economic uncertainty and rampant money printing continues, confidence in governments will be put to the test and found wanting. People will return to the tried and true store of value, gold. The signs are already showing up that the public is beginning to move into gold. Gold coin and bullion purchases have risen dramatically for the last two years. Now we are seeing the first signs that the big boys are moving into gold.

China should buy gold to hedge dollar fall-researcher

By Zhou Xin and Alan Wheatley BEIJING

June 25 (Reuters) – China should buy more gold because the dollar is poised for a fall and the metal is needed to support the greater international role envisaged for the yuan, a senior researcher with the ruling Communist Party said on Thursday.

Li Lianzhong, who heads the economic department of the Party’s policy research office, said China should use more of its $1.95 trillion in foreign exchange reserves to buy energy and natural resource assets.

Speaking at a foreign exchange and gold forum, Li also said that buying land in the United States was a better option for China than buying U.S. Treasury securities.

Should we buy gold or U.S. Treasuries? Li asked. The U.S. is printing dollars on a massive scale, and in view of that trend, according to the laws of economics, there is no doubt that the dollar will fall. So gold should be a better choice.

There is no suggestion that Li, even though he is a senior researcher, was enunciating an agreed party line.

However, a debate is swirling in China about how the country can reduce its exposure to the dollar and to U.S. assets in case America’s ultra-loose fiscal and monetary policy rekindles inflation and erodes the value of the dollar and U.S. Treasuries.

Rumors are beginning to surface surrounding mid-tier banks, those that are not so big that they cannot fail, moving into gold as a hedge against inflation. This trend is in it’s early stages and will accelerate as the financial crisis deepens in the fall. Gold will be the beneficiary of central banks moving into the gold market. As a side benefit, this action will negate any impact of the threatened IMF sales of gold because the worlds central banks will remove the gold from the market as quickly as it comes out of IMF hands.

Approximately 160,000 Tons of Gold

Approximately160,000 tons of gold has been brought to the surface of this planet since mining it started. If we use $950 per ounce as it’s stated value, it is worth $4.9 trillion. If we look at all of the currencies in circulation around the world, we come up with a total of roughly $60 trillion or twelve times the value of the gold currently in existence. “Quantitative easing” is rapidly changing the spread in the ratio of the paper value to the gold value. As the public begins to perceive the loss of purchasing power in their respective currencies, many people will begin to question the viability of paper money as a store of value and they will turn to gold and silver. If only a small fraction of the available paper money moves into the gold and silver markets, prices will explode!

That, in a nut shell, is why it is time for gold investing. Gold is on track to reach $1,200 before the end of 2009 and it will accelerate up as the dollar slides down to .72, .62 and ultimately to .52.

A Quick Word on Silver!

Gold is reverting back to it’s original function as a currency and silver should be viewed in the same manner. It may help to think of gold as paper dollars and silver as the change in your pockets. Both have value, but one has more than the other. With gold in the mid $900s and moving higher, it is tough for some to purchase it. Silver in the mid $14 range offers everyone the opportunity to convert paper dollars into real stores of value. Silver presents a great opportunity for profit going forward and should be on everyone’s list for purchases on dips.

It is time to invest in gold and precious metals because the world as we know it is going through a “sea change” and the window of opportunity is rapidly closing.

Till next time, good luck and good trading!