Gold was lower
before the open, but came back to unchanged shortly thereafter and silver is
down $.15. The dollar is soaring again,
up 47 basis points at 75.76. Gold is
holding in spite of the rally in the dollar and that is indicative of the fact
that people are holding gold because they believe that it is the best form of
money. In fact, listening to CNBC this
morning, I heard one stock fund analyst saying that their fund had 15%
diversified into physical gold bars. He
said they held the gold because they feel it is the best form of currency. He said almost all central banks are
pursuing easy money policies and therefore there is no form of money that is as
attractive as gold. We also know that
gold is an effective preservation of wealth asset and that it is an asset that
can be converted into any currency in the world with ease.
The most
interesting thing that I continue to hear analysts' discussing on the financial
television stations is that they feel gold is a good diversifier for their
equity holdings.
With interest rates
in the U.S. essentially at zero, there is no advantage to holding liquid assets
in treasuries or other forms of cash.
With gold, investors have an opportunity for gains that outperform the
negligible yield on treasuries or money market funds. Moreover, the most sophisticated investors in the world such as
John Paulsen, David Einhorn, and many other sophisticated market analysts and
investors like Jim Rogers, are all moving into gold very aggressively even at
these levels and expected to reach net buying of 30 tons. Central banks are buying gold at market
levels. The demand for gold from
central banks is at record levels.
Central banks have not been net buyers of gold in over 20 years. Therefore, this is a major shift in
sentiment. Once again, central banks
are holding gold as a replacement for the dollar.
While some analysts
think that a correction is overdue in the precious metal sector, most believe
it will be short lived and prices will continue higher very quickly. Forecasts of $1,200 by year-end are now
commonplace. HSBC has joined those
along with CommerzBank and others who think that gold will reach $1,200
quickly, perhaps by the end of the year.
Next year, analysts are forecasting prices from $1,500 to $2,000. In my view, the fact that John Paulsen is
starting a new gold fund that launches on January 1st and that he is
putting $250 million of his own money into that fund, is indicative of the
expectation that gold will rise dramatically over the coming years.
Dow Jones Wire
Service reported that Société Générale's Dylan Grice is arguing that gold
prices could ramp up to $6,300 or more within the decade, and possibly over the
coming few years. GFMS this morning
forecast that silver investment demand might push the price of silver over $20
an ounce in the short-term.
Given all of the
factors that are supportive of gold and silver assets over the near-term and
especially the longer-term, it makes sense to have some diversification into
gold. When traditional stock mutual
funds are diversifying their holdings with gold, it should be an indicator to
all investors that it makes sense to have some money in gold. Goldline has been in business for nearly 50
years serving investors who wish to own gold and silver assets. Call Goldline today at 1-877-341-2646 for
assistance in getting started or adding to your holdings. Goldline offers a free gold investor
information package, which contains excellent articles from major banks and
brokerage firm analysts, along with information that should be interesting and
helpful to all investors. Call Goldline
at 1-877-341-2646 to receive your free information package.
Investors should
ask Goldline 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 on gold investing call Goldline at 1-877-341-2646. 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 gold investment package.
You should carefully read Goldline's Account and Storage Agreement and our risk disclosure
booklet, Coin Facts for Investors and Collectors to Consider. These provide important
information that you should consider before investing in precious metals. 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 semi-numismatic coins such as the European francs, proof
coins and graded coins. The market must go up enough to overcome this spread before an actual
profit is achieved. All markets go up and down. 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 portfolio though others may
recommend a different percentage. Please see Goldline's risk disclosure materials for additional
information.
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