GOLD STILL IN TRADING RANGE

Yesterday's announcement of the private/public partnership to purchase toxic assets from banks caused an enormous weight of enthusiasm among stock investors. Their buying late in the day (after the New York Gold Market closed) drove the Dow up 500 points. In the after-market gold began to react to that, but in the overnight markets it sold off heavily dropping as low as $916.90 on the futures contract before rebounding to $921.90, down $30. Silver fell as low as $13.32 before rebounding, but is still down $.50 on the day. This leaves gold confined to the trading range that it has been in for the past couple of months trading between $880 and $950. However, the momentum for the market is higher. Technical analysts believe this market is going to break out to the upside. In addition, in the last couple of days UBS Bank raised it's forecast for gold to $1,050 within a month and $1,100 within three months.

Gold came off after the bank announcement simply because the demand for safe haven assets was reduced. Normally, one would think that would also impact the dollar. However, the dollar was down roughly 50 basis points yesterday, and it is up about the same this morning. This means it was neutral for the dollar. Equities are lower today, but the correction of 50 points in early trading isn't very much. Oil is also lower, putting some pressure on the metals markets, down $1.15 at $52.65 a barrel.

Analysts are observing that for the moment silver seems to be more resilient than gold and the gold to silver ratio is narrowing. Analysts conclude that this is primarily due to the industrial usage of silver, which would increase in an expanding economy.

If we look at the actual details of the so called "Toxic Asset Bailout Plan" what we see is further printing of money out of thin air and massive inflationary policies that will be very difficult to contain once the economy begins to turn. In this program, the government is putting up virtually all the money and will take all the losses, while sharing in only 50% of the profits. Treasury Secretary Geithner specifically exempted the banks that participate in this program from the restrictions on paying bonuses. Moreover, those who participate to purchase these toxic assets will be managing the program and entitled to collect management fees, which typically run about 2% per year. That means for the 3% in cash that is put up by the private entities (most of which will be borrowed or obtained from individual investors) the private entity gets half the profits plus management fees which means they put no money up whatsoever. There is no recourse if there are losses. Consequently, the government will take 97% of the losses for only 50% of the gain. This is a crazy program that in my opinion will do little to alter the fundamental problems that exist with regard to these underwater credit derivatives.

AIG announced that it has credit derivatives on its books that need to be managed and liquidated in excess of $1.5 trillion. The total amount of these credit derivatives that exist among the major banks may be $30 trillion. Will this program work to resolve these issues without liquidating those obligations? Only time will tell.

Within the next two weeks they will also alter the mark-to-market rules, which will further help these major banks. However, the situation looks very similar to what they did in Japan, which remained in a depression for over 20 years because of similar bank problems.

Going back to gold, J.B. Weir of Goldman Sachs said that gold held up well in light of gains of 6.8% in the Dow. He said the impact was muted because the longer-term growth/inflationary risks continue to attract investment flows into gold. The Dow Jones Wire Service analyst themselves also indicated that gold continues to look bullish in these markets. They said, "Spot gold now at $942/oz, has rare bullish cross on charts with 100-day moving average now above 200-day moving average, says Dow Jones commentary analyst Mark Cranfield. Last time these averages crossed in February 2007, gold was around $660 – then rallied above $800 in the same year, before peaking out at $1,030 in March 2008. If gold keeps its safe haven status with investors, alive with bullish chart signals, another run at $1,000 is on the cards for coming weeks with medium term target at $2,000 at peak." UBS Bank's analysts also see gold higher along with those from Merrill Lynch.

Therefore, as the metals are in a period of correction and consolidation, they present a buying opportunity for longer-term investors. This is an opportunity that can be utilized by calling Goldline at 1-877-341-2646. Ask them to explain their Price Guarantee Program, which provides a two-week window of opportunity to re-price your transaction in the event of a correction. This enables you to get the best price possible within a two-week window of opportunity. See if you qualify for this special program.

You should also ask for the free information package, which contains excellent articles on the development of a new global currency. This may be revealed as early as next month. A new global currency will remove the U.S. dollar as the world's trading unit and reserve asset. This would enable the U.S. government to inflate more aggressively than it could otherwise do. It will also tend to protect and insulate foreign creditors of the U.S. because debt to foreign nations would most likely no longer be in dollars but would be in the new global currency. These are the kinds of factors combined with rising inflation pressures that could cause gold to move to extraordinary levels. These are also the kinds of issues that should be considered by investors in determining how to protect and preserve the purchasing power of their accumulated wealth. These articles are extremely important for everyone to read and I strongly recommend that you ask for them by calling Goldline at 1-877-341-2646. Tell them "Joe said to call" and they will be happy to give you a free copy of the CD interview that I did with Frank Barbera, along with a free copy of the American Advisor Newsletter, a $25 value free. Call Goldline at 1-877-341-2646.

We are also enclosing a brand new article that I just obtained where China has called for the creation of a new currency to replace the dollar as the world's standard. China has now formally joined with the United Nations, Russia, and other countries to call for the ditching of the dollar as the world's reserve currency. We now have three articles in the free information package, which address this issue. Be sure you call Goldline for this information at 1-877-341-2646.

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 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.