Daily Commentary

Gold Gains Ground As The Dollar Weakens

Gold is up $2 in early trading while silver is about unchanged.  Oil is up $.25 at $101.22 and the U.S. dollar is down 11 basis points at 72.45.  The equity market looks like it's going to hang on to most of yesterday's extraordinary gains as it is only down 33 points.  Gold is gaining ground as the dollar weakens.  However, the rebound off of the correction we've seen in the past four days appears to be tepid.  Perhaps after Fed Chairman Bernanke concludes his remarks to congress the markets will establish new direction.  For the moment analysts and speculators are looking for some indicator that will provide new direction for the precious metals.  The question is whether the correction will extend further or will begin to rebound back above $900.  Bernanke's comments that the economy is going to weaken suggest interest rates will continue to decline.  As they do, the dollar has the potential to decline further, bolstering the gold market.

A big question is what will the euro do?  The IMF has just issued a report warning that the conditions in the U.S., Europe and other parts of the world are likely to worsen and warns against a worsening situation in the financial system in the U.S.  In fact they said the conditions appear to them similar to what triggered the Great Depression of the 1930's.  This charged language created a lot of anxiety among global investors.  In his testimony, Bernanke said had they not stepped in to bailout Bear Sterns it would have filed for Chapter 11 bankruptcy protection.  That in turn would have created stress throughout the financial system and chaos would have ensued that would have been damaging to the economy.  Bernanke also said in his view this wasn't a bailout of Bear Sterns as the stockholders and employees suffered from the takeover.  He also indicated that had they not done so, lending would have totally dried up and chaos would have ensued.  Individuals would not have been able to borrow money at any cost.  This would have been crushing to the economy.  He further indicated that GDP will not grow much if at all, and could even contract slightly.  I think that is a clear indicator that they will continue to lower interest rates, perhaps aggressively so.  However, they are running out of ammunition.  He also encouraged congress to take some action to address the housing issue from the point of view from the consumer or homeowner.

With such loose monetary policy and fiscal policy likely to further inflate and destroy the value of the dollar, this is a great opportunity to be acquiring precious metals on this dip and correction period.  Call Goldline now at 1-800-827-4653.  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 Krugerrands, Canadian Maple Leafs, American Eagles, Silver Bags and Silver Bars.  However, I highly recommend investors utilize Goldline's Price Guarantee Program, which is available with Swiss 20 Franc gold coins but is not available with the bullion assets.  This program allows an investor a two-week window of opportunity to re-price their order in the event there should be a further correction.  That is a very valuable tool in this environment.  If you have made your transaction within the past two-weeks, you may wish to give some consideration to utilizing the Price Guarantee Program to get more gold or silver for your money, particularly if the two-week time period is running out.   An additional benefit of the Swiss 20 Franc gold coins is that when you acquire 29 of them and receive the 30^th free.  If you would like to consider silver examine the opportunity with pre-1964 silver half dollars.  Acquire $5,000 worth of them and receive free shipping.  You can combine both of these offers to receive free shipping and a free Swiss 20 Franc gold coin.  Call Goldline now to learn the details of these special offers at 1-800-827-4653.

Goldline has a terrific free information package that is available to all investors.   It contains the company brochure, which explains the benefits of owning gold and silver along with independent third party source articles that you will find extremely helpful.  There are several brand new articles in the free information package that will be beneficial in explaining the conditions that are going on in our economy today.  Goldline will also provide you with a free Coin Facts Risk Disclosure Booklet, which you should read carefully before making an investment.  Call Goldline now to receive the free information or to get started at 1-800-827-4653.

Investors should be mindful that past performance does not guarantee future results. Transaction costs are generally 5% to 7% 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 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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