Though last trades showed gold down slightly, silver was again up, closing above $29.11/ounce. Cooper broke through the $10,000 a TON mark, (and I do so appreciate everyone laughing with me when I quoted it as an ounce on Friday–just used to quoting Gold/Silver more than anyother metals-still no excuse, cause I proofed it and didn’t catch it.)
With the political unrest spreading throughout the Middle East and becoming more violent every day, ordinarily the “Smart Money” would seek Safe Haven in U.S. Treasuries; however, this time, they have not. Many went to Europe after Angela Merkle through her support behind the EU Dollar and the leaders of the EU Nations agreed to meet and set strict financial standards to all EU Countries,so hopefully there would not need to be any more bailouts. Another reason was that the Institutional Investors believed that the European countries had an acceptable inflation rate and that meant that their currency would grow with them. Our government officials are still saying the we have no inflation in this country, which is not true, but given the CPI as the figure used to calculate inflation, one can make it most any figure. The CPI does not include the price of FOOD or ENERGY of any type. Brian Farber, Editor and Publisher of “Gloom Boom & Doom” and a renowned international speaker, was in Moscow speaking at the Russian Form, as it was being broadcast live on CNBC. Mr. Farber did indeed call Mr. Bernanke a liar re: the inflation figures and went even further to say that the Feds were “cooking the books” to deliberately manipulate the people.
Many experts and analysts are still saying BUY BUY BUY here at this level, and the majority are recommending coins, as they are easily delivered, not hard to store, and available if ever needed in a hurry. Many of the Precious Metals ETFs are redeemable in fiat currency if one reads the fine print, and that is exactly why one is purchasing the gold or silver, is so one does not have all the eggs in the same basket. It is called diversification.
Technically, gold could retreat another $10-$15 if there is heavy selling, but it does not appear likely. China has been systematically selling her U.S. Treasuries and purchasing additional gold. China has now surpassed India as the country with the most gold. China’s gold purchases lst year were 5 times higher than the year before, and that was only counting three of the quarters, as figures were not yet available for 4th quarter. With the added demand for gold, but from India and China, and several other countries, including many countries’ Central Banks (akin to our Federal Reserve) are also purchasing the gleaming bullion as a hedge against total economic collapse. Silver’s chart is impressive no matter wihich way one cares to look at it. Silver could easily triple in 2011, as it’s trading well below the Gold/Silver price ratio.
It will be interesting to see how this week plays out internationally, as the rioting has spread to at least 8 other countries, including Saudi Arabia. This could force the price of Crude Oil out of the market, except for one thing. Our economy runs on oil and the products made from refining it; however, one cannot store oil, nor spend it in an economic collapse, but the upticks on Brent Crude only serve to confirm the technical upside breakout on silver and probably gold again this week.