GOLD POISED TO CHALLANGE $1,000 AN OUNCE

by Joe Battaglia | May 28, 2009

Silver continues to lead the market higher, with a gain of $.21 while gold is up $3 in early trading. Gold and silver are up in spite of the fact that the dollar is firmer by 16 basis points at 80.49 on the index. Oil is also firmer, up $.53 at $63.96 a barrel. Oil was as high as $64.19 a barrel. Clearly, we are going to be seeing oil price inflation in addition to the monetary inflation created by the Fed and the government. Analysts are saying that silver will outperform gold and platinum over the near term. The expectation is that silver will post bigger percentage gains. Barclay's Capital has now joined with UBS Bank in forecasting that silver will outperform gold with the ratio between gold and silver narrowing. China and Russia again called for a new global currency. The IMF will issue bonds denominated in the new currency referred to as SDRs.

New claims for unemployment dropped to a seasonally adjusted 623,000, which was below expectations. However, the number of people continuing to receive unemployment benefits rose to 6.78 million, the largest total on record dating back to 1967 and the 17th straight record week. I suspect that the raw numbers might indicate an even greater loss of jobs than reflected in the seasonally adjusted number.

Also, on the economic front, General Motors has announced that it has made a deal with its bondholders. Some think this may alleviate the need for a bankruptcy filing. However, others believe it will simply ease the bankruptcy process. Whichever is the case, clearly the U.S. government is going to end up being the majority owner of General Motors. One has to question whether they will allow GM to go along with its plan to build two out of three cars sold in America overseas. This, I think, would be a total disaster from an economic and political view.

JP Morgan's gold analyst Michael Jansen said the prospect of a material move to lower ground for gold is minimal unless there is a strong across the board rally in the dollar. That is highly unlikely given the fact that so many countries are moving away from dollars and looking to establish a new global reserve currency. As a result of these forecasts and the combination of good technicals and excellent fundamentals for gold and silver, many are adding to their holdings in an aggressive manner. I think everyone should own some gold and certainly it would be wise to be properly diversified with some gold holdings.

To get started with gold or to add to your holdings if you are underweight, call Goldline at 1-877-341-2646 for assistance in getting started. Ask them about their Price Guarantee Program and the various forms of gold and silver that are available to you. Also, ask for the free information package. In there you will find a coupon that provides you with the opportunity to receive free shipping or utilization of the Price Guarantee Program. In addition, you will have choice of a free CD or DVD of the new interview I did with Frank Barbera along with the excellent article package. The free information package provides information on gold and silver along with information on the development of a new global currency and the potential for dollar devaluation. Call Goldline at 1-877-341-2646 to receive your free information package.

Contact Goldline and ask them to explain the features, benefits and cost structure of the various gold and silver products available. Select those that best meet your own personal and individual needs and objectives. Those looking for low transaction costs may wish to consider bullion assets such as American Eagles, Swiss 20 Francs, 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 a purchase. Call Goldline at 1-877-341-2646 now to receive your free information package.

†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 Goldine's Account Agreement along with our risk disclosure booklet, Coin Facts for Investors and Collectors to Consider ®, prior to making your purchase. Goldline has a spread or price difference between our selling price, called the "ask", and our buy-back price, called the "bid". That spread varies depending on coin or bar you acquire. Spreads on 1 oz bullion coins, 90% silver dimes and quarters, and one ounce and larger bullion bars are 13%. All other coins have a spread of 28%. There is also a 1% liquidation fee when you sell your coins back to Goldline. 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. Past performance does not guarantee future results. Coins are a long-term, three- to five-year, preferably five- to ten-year investment. We believe precious metals are suitable for 5% to 20% of the average investment portfolio though others may recommend a different percentage.

To receive free information package on gold and precious metals investing, call Goldline at 1-877-376-2643.

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