Gold Likely to Move Above $1,000 This Year
by Joe Battaglia
Posted: June 17, 2008
Gold and silver
started lower, but rebounded off the lows with gold trading down $3 and silver
down $.24 in the first twenty minutes of trading. The dollar is about unchanged at 73.60 and oil is down $1.50 at
$133.11. The Dow is up 15 points.
This morning's
market is being driven by the economic statistics. Westpac Bank's Chief Currency Strategist Robert Rennie said the
G8 statement over the weekend was a "good argument for seeing gold as a good
buy." Wholesale prices jumped upward
for the biggest gain in six months. The
producer price index rose 1.4% in May.
That was up from a modest 0.2% rise in April and marked the biggest
increase since November. On an
annualized basis that would be equivalent to 16.8%. Moreover, industrial production dropped in May underscoring the
strain on factories from the housing slump.
An analyst on CNBC this morning said the housing problem is likely to
worsen substantially with prices falling aggressively over the next year.
When we look at
wholesale inflation in energy and food costs, it is clear that companies across
the board are going to have to raise prices to accommodate the higher costs. Yesterday, Dow Chemical announced it's
largest price increase in its 111-year history. Because of the increased cost, employers have been cutting jobs
every month this year. Moreover, the
economy is weakening at a rapid rate.
All of these factors
provide a dilemma for the Fed. If they
raise rates to try to curtail inflation, they will certainly sink the economy
and the banking system. Therefore, I
believe the Fed will have to take a "go slow" approach, which will be positive
for gold. The Fed meets next week. If they hold rates steady, as I expect them
to, gold should make a significant move to the upside. Merrill Lynch analyst Michael Jalonen sees a
potential for $1,000 an ounce by October.
I think Merrill Lynch's analyst will be correct.
I think gold is a
buy at these levels and it is likely to move above $1,000 an ounce over the
remainder of this year. Gold presents
an excellent investment opportunity at these levels. Call Goldline today to acquire precious metal assets at bargain
basement prices, 1-800-827-4653.
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 articles on the dollar, the economy and gold call Goldline at
1-800-827-4653. Goldline also provides
several other helpful articles. There are
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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