Return To A Gold Standard - Forecasts of $7,000 - $10,000
by Joe Battaglia
Posted: June 9, 2008
After gaining
nearly $24 on Friday gold is remarkably hanging in there trading unchanged in
the first half-hour of trading. Silver
however, has given back some of its gains from Friday, down $.12. Oil is down $2.83 at $135.71. That is a modest correction given the fact
that it was up almost $11 on Friday.
The dollar is also rebounding a little, up 30 basis points at
72.67. Overnight, August gold reached a
peak of $912.50. That was its strongest
level since May 28th as the overnight markets continue to build on
Friday's sharp gains.
James Moore, one of
the best analysts in the business told Dow Jones News Wire: "Volatility looks
set to remain at elevated levels in the coming sessions, reflecting the
increased economic/inflationary concerns; however this should prove favorable
for gold as investors seek to offset the increased risk through the more
traditional safe haven assets." In
other words, this is a great buying opportunity. Investors should take advantage of the opportunity to acquire
precious metals as they come out of the period of correction and
consolidation. Remember, most of the
major analysts including Merrill Lynch, Credit Suisse and other analysts think
gold will be above $1,000 an ounce by the end of the year. Therefore, we are in a window of opportunity
to acquire gold and silver assets at bargain basement prices. Once gold makes a decisive breakout above
the $900 level, I think you will see it moving into the $950 range rather
quickly.
Lehman Brothers
announced that is going to attempt to raise $5 billion to offset some of the
losses that it has taken in the credit derivatives markets. Some believe that these problems in credit
derivatives will damage the dollar even further, forcing some kind of return to
a gold standard. Professor Robert
Mundell, the Nobel Prize winning economist, is in contact with Chinese
officials and others. It would appear
that China is interested in going back to a gold backed system. Today, the Wall Street Journal featured an
editorial calling for a new Bretton Woods style gold standard. In my view, and that of some others, if we
were to go back to an international Bretton Woods type of agreement, gold would
probably have to be somewhere above $7,000 an ounce. This would be without a full gold backed system. Therefore, when we see analysts like Frank
Barbera forecasting gold could rise to between $8,000 and $10,000 over the next
five years or so, it is not an outlandish forecast.
April pending home
sales were up 6.3% versus expectations of a .5% decline. This would suggest that perhaps there are a
lot of bank owned properties that are beginning to move at these levels. However, in my view, it is doubtful that the
problems in the housing sector are over.
Most analysts believe they are actually just beginning. These would include members of the Federal
Reserve board.
Whether investors
acquire gold as a safe haven asset, a hedge against inflation, an asset that
can produce extraordinary gains in this type of market environment, or simply
as insurance on the purchasing power of money, it makes a great deal of sense
to acquire some gold at these levels. Call
Goldline today. Ask them to assist you
in getting started with your precious metal diversification now.
Investors should
contact Goldline and 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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