Gold and Silver Rebound Nicely
by Joe Battaglia
Posted: May 30, 2008
Gold and silver
have rebounded this morning with gold up over $6 and silver up $.31. The metals are a little off of their highs,
but still showing an improvement from yesterday. The rebound in gold is due to a number of factors including
higher oil, up $1.23 at $127.85 a barrel and only a slight increase in the
dollar, up 3 basis points at 73.05. The
economic data is also supportive of the gold market as it indicates that the
economy is indeed weakening.
The University of
Michigan consumer sentiment number was 59.8 in May versus 62.6 in April. That's the lowest level in 28 years. Declining consumer confidence suggests lower
consumer spending ahead and further weakening of the economy. Moreover, inflation indicators suggest
inflation is on the rise both in the U.S. and throughout the rest of the
world. While inflation is rising, wages
are not, causing increased pain to consumers.
Inflation effectively reduces purchasing power, forcing consumers to
slow their spending. According to the
latest data adjusted for inflation, consumer spending in April was flat. Moreover, this data is based on the
government's numbers, which are obviously skewed. The government data suggests that inflation is approximately
3.8%. However, utilizing the same
method of calculating inflation that was used during the Reagan years, inflation
is running about 11%. Which do you
think is more accurate? In my view,
inflation at 11% still understates the true rate of inflation.
In addition to the
inflation problem, there are a number of articles appearing on almost a daily
basis that indicate the problems in the banking and housing sectors are far
from over. As Frank Barbera said in the
interview, the problems in the housing and financial sectors have only just
begun. Moreover, the demand for
commodities is increasing as many parts of the world are experiencing
phenomenal growth. The combination of
factors, along with the efforts by the Fed and the government to stimulate the
economy is clearly inflationary.
Economic conditions appear similar to those of the 1970's. Given that experience, we should expect much
higher inflation rates and soaring precious metal values.
While the metals
have been in a period of correction and consolidation, they nevertheless are
building strength and attempting to establish a new base for a surge to
dramatically higher levels. While many
analysts believe the period of consolidation could continue for a while longer,
many are forecasting gold above $1,000 an ounce by the end of September. Therefore, we are in a window of opportunity
to acquire precious metal assets.
Goldline has in
place a very special offer that will enable today's investors to acquire gold
and silver with a dramatically reduced risk of further corrections. Call Goldline and ask them to explain this
special benefit for you. It will only
be offered for a short time.
Investors should
contact Goldline at once to take the necessary steps to be properly diversified
in this volatile market. Ask them to
explain the features, benefits and cost structure of the various gold and
silver investments that are available to you.
Select those that best meet your own personal and individual investing
needs and objectives. Investors looking
for low transaction costs may wish to consider bullion assets such as American
Eagles, Krugerrands, Canadian Maple Leafs, Silver Bags or Silver Bars. However, the Price Guarantee Program is not
available with these assets.
If you would like
to take advantage of the Price Guarantee Program, which provides you with a
two-week window of opportunity in which to re-price your order in the event of
a correction, you must select assets with some collectible value such as Swiss
20 Francs, Double Eagles and Silver Dollars.
When you acquire 29 Swiss 20 Francs, you will receive the 30th
coin for free. Investors may wish to
consider several tubes of these coins to obtain several free Swiss 20 Franc
gold coins. Call Goldline at
1-800-827-4653 for further information.
To receive the free information
package including the special booklet from the FDIC that helps you to
understand whether your bank accounts are safe and enables you to be sure that
your bank has the proper insurance to protect your deposits, call
Goldline. We also provide several other
helpful articles. There are also a
number of other independent third party source articles that you will find
extremely helpful and informative. You
will also receive the company brochure and a Coin Facts Risk Disclosure
Booklet, which you should read carefully before you make an investment.
Goldline will also send you a free
CD of the special interview with analyst Frank Barbera if you ask for it. This is a remarkable interview and I think
everyone would benefit from listening to it.
Call Goldline now to receive your free information package at
1-800-827-4653.
You should carefully read the client Account Agreement and the Risk Disclosure information.
These explain important things you need to know before you invest in precious metals, such as:
past performance does not guarantee future results. Transaction costs are generally 5% to 10% on
bullion and 30% to 35% on coins. This is also referred to as the spread, or the difference
between the buy price and the sell price. The market must go up enough to overcome this spread
before an actual profit is achieved. All markets go up and down. Coins are a long-term, three- to
five-year, preferably five- to ten-year investment, suitable for 5% to 10% of the average
portfolio. Please see Goldline's Risk and Disclosure Statement for further details.
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