GOLD AND SILVER HIGHER

Gold is up $5 in early trading on safe haven demand related to bank worries. George Gero said, "Everybody is a little concerned about the stress test results. The financial fears have not gone away. The aversion to risk is still here." As a result, both gold and silver are a bit higher with silver trading up $.12. The dollar is about unchanged, down 4 basis points and oil is down $.15. The Dow Industrials are down 48 points.

The World Gold Council said first quarter interest in gold rose as investors sought portfolio diversification. They said, "One reason the financial crisis has been so devastating for investors is that many alternative assets did not deliver on the promise that they would provide portfolio diversification. The same cannot be said for gold. Gold has been one of the few assets that has genuinely provided investors with diversification throughout the financial crisis." In other words, gold held up well in its role as a portfolio diversifier and a hedge against crisis. They said further that anecdotal reports from coin and bullion dealers point to another strong quarter in retail demand for gold coins and bars in the first quarter after a 396% year-on-year increase in the fourth quarter. Shortages continue to be reported in the availability of official coins and small bars. Summing up their views they think safe haven and inflation hedge demand will continue to be prominent features in the gold market going forward. As a consequence, gold should benefit over the months and years ahead.

Treasury Secretary Geithner said this morning that there has been unprecedented cooperation between countries in trying to resolve the global financial crisis. He said that all nations are doing their part to try to work through the difficulties in the financial markets. He further said this process will be long and drawn out and that unemployment and our own economy will both continue to worsen for the foreseeable future. However, he was optimistic that the problems would resolve themselves. Moreover, he said the government is trying to devise plans to remove some of the enormous amount of fiscal and monetary stimulus that has been put into the market. He said it will be very important to act at the appropriate time. One of the things he said is that governments often make the mistake of acting too quickly to pull back the stimulus and monetary policy. He said they will not make that mistake, they will allow the economy to obtain a full growth pattern before taking any steps to pull back the fiscal and monetary stimulus. In effect, what he is saying is that they will tolerate a significant increase in inflation in order to be sure that the economy is clearly on a path of recovery.

I suspect this may be a process that takes a few years. As that process occurs, inflation will rise perhaps into the 8% to 10% range, which would be bullish for gold and silver. Over time the dollar will fall rather considerably from the levels it is at right now. An analyst from UBS Bank said the dollar is close to 7% overvalued compared to its long-term trend. If there were a 7% correction in the dollar, it would not surprise me to see a 14% or 15% up move in the gold market.

One of the things that Geithner said lead me to conclude that the U.S. government is planning to cooperate with the IMF and other countries in terms of the policies that are developed with regard to monetary policy as well as fiscal policy. This ties in with China's demands that the world have a greater say in the macroeconomic policies of the U.S. In effect, we would be surrendering some of our sovereignty to the international community. That is fraught with many problems. He also made remarks that implied to me that they may be supportive of the IMF taking a greater role in the world's reserve currency. There is some evidence to suggest that the Obama Administration would be willing to go along with replacing the dollar with a new reserve currency of some sort overtime.

These are the kinds of uncertainties that push people towards the safety of gold. Moreover, I continue to believe whether it is a continuing de facto devaluation such as we have been seeing for the past 35 years or a formal devaluation, I believe the dollar will devalue overtime. Investors and consumers will see that reflected in higher inflation.

These are all excellent reasons why investors are accumulating gold and why every investor should consider some diversification into gold and silver assets. Those who have not properly diversified yet should call Goldline at 1-877-341-2646 for information on getting started with gold. Ask them to explain the benefits of Swiss 20 Francs, British Sovereigns, gold Double Eagles and other forms of gold and silver investments. Be sure you ask for the free information package. It contains excellent articles discussing the potential for a new global currency, the potential for devaluation of the dollar, the potential for gold to reach $1,200 or more over the course of this year, and many other topics that you will find helpful and informative. Call Goldline now at 1-877-341-2646 to receive the free information package.

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. 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 20 Francs, Double Eagles and Silver Dollars. Call Goldline at 1-877-341-2646 for further information on the Price Guarantee Program.

To receive the free information package, including articles on the dollar, the economy and gold, call Goldline at 1-877-341-2646. 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 Client Account Agreement, a company brochure and a Coin Facts Risk Disclosure booklet. Read these carefully before you make an investment. Call Goldline at 1-877-341-2646 now to receive your free information package.