GOLD CLIMBS TO FIVE-MONTH HIGH AS MONEY ALTERNATIVE

After hitting an all time high early Tuesday morning, Gold has weakened throughout the day. Gold hit a five-month high in New York Tuesday on signs of increased demand for the metal as an alternative paper currencies.

Traditionally, gold has moved inversely to the dollar; however, recent concerns over the Greek sovereign debt crisis are stirring fears among investors about all fiat monies. Warren Buffet spoke to this concern last weekend, telling investors he's bearish about the ability of all currencies to hold their value over time because of massive deficits being run up by governments in the wake of the global financial crisis.

Stocks are down across the board on Tuesday as concerns intensified over Greece and the ballooning European national debts. According to an article in today's Marketwatch, "At this point, the situation has developed from a mere Greece-crisis into a full blown euro-zone sovereign crisis." (Marketwatch 5/4/10)

President Obama said in a speech to business leaders Tuesday that the past two years of recession have been "difficult," but "the storm is receding." Judging by the volatility in the markets today, investors seem less confident.

Dow Theory's Richard Russell hints in his letter of May 3 that we may be seeing heightened concerns over all paper currencies in the near future. According to Russell, "What we are seeing is the slow, steady decline of the greatest fraud ever perpetrated on the people of the world. The fraud I am referring to is fiat money. This is the so-called "money" created by the central banks. Fiat (non-intrinsic) money can be created at will by a central bank via a computer." (Dow Theory, 5/3/10)

Gold is typically bullish in times of economic uncertainty. Investors who wish to learn about the benefits of investing in gold should call Goldline at 1-877-341-2646 and ask for the free information package. It contains excellent articles on precious metal forecasts and the economy. Call Goldline now at 1-877-341-2646.

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This material has been prepared for private use. Although the information in this commentary has been obtained from sources believed to be reliable, Goldline does not guarantee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice. You should review Goldline's Account and Storage Agreement along with our risk disclosure booklet, Coin Facts for Investors and Collectors to Consider ®, prior to making your purchase. Goldline's spread, which is the difference between the price we sell our products and the price we buy them back, generally ranges between 5% to 20% on our most common bullion products and 30% to 35% on all other products including our popular European francs, proof coins, silver dollars and half-dollars, and graded coins. The market must go up enough to overcome this spread before an actual profit is achieved.  Precious metals and rare coins can increase or decrease in value.
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