I have read two articles in the past few days that both said that gold may soon have a nice big breakout. One of them is the new Jim Willie CB piece:
(I have forgotten where I read the other article, but it described gold's recent prices as being in a wedge that will break one or the other)
I am not a market technician. But, the recent price increases of the past two days HAVE crossed some important technical levels. Take a look at the GLD at stockcharts:
Recent economic news has been very bad lately. The 10-Year Treasury yield is 1.43% as I write. 1.43% for 10 years???
The drought has already started to affect food prices. There are reports that we are importing corn from BRAZIL. Southern Europe (a major grain exporter) now has a drought as well. Other parts of Europe are soggy or even flood riven (Russia). And recall that much of our (shrunken) corn crop is being diverted to ETHANOL, which really ought to be scandalous to us all.
Mortimer Zuckerman (Chairman of US News & World Report, and no right-winger) wrote on July 24 that the job market is very grim, much worse than the massaged numbers we are getting from our .gov. The title of his piece says it all: "Unemployment Is Still The Biggest Election Issue". The book I recently reviewed (Jim Clifton's The Coming Job Wars) described in great detail how JOBS (lack of) is without doubt our nation's biggest problem. Jobs, jobs, jobs should be what the upcoming election should be all about.
Who trusts the stock market now? Who trusts their broker? Recent scary articles about "Allocated Gold" (in which "your" gold bar, serial number and that you have to PAY them to store) could still be at risk... MF Global and PFGBest still reverberate... Who's next?
Real estate? The banks are sitting on large numbers of foreclosed homes... Commercial real estate? Most of the malls and shopping centers have more vacancies. There is LOTS of commercial real estate I see for sale as I drive around my city. Farm land has been in a bubble...
More QE? Each QE variation brings less and less. More debt now means economic DECLINE now.
.gov spending? Even more out of control than ever. Let's see what happens as we near the "fiscal cliff"...
Overseas? Michael Pettis and others write that China is on the verge of a serious downturn. The Middle East is in more-than-usual turmoil. We have three carrier groups near Iran... Europe is apparently down even more than we are.
So, where do you go with your money? You buy some gold with it! Real physical gold. Do not buy ANY sort of paper gold!
Gold is truly a gift at a bit over $1600. How high will it go and when? I have no idea, VERY few do. But, it looks like it WILL go WAY UP over time.
Gold has been the BEST wealth preserver for over 4000 years. Only 1% - 3% of Americans own non-jewelry (investment) gold.
And you do not have to go "All Inn"! A few ounces may make the difference between you and your family's survival. 5% of your total financial assets in gold is accepted by almost all mainstream financial advisers. Yet, how many people have 5% of their assets in gold? Not many.
Note that I have not discussed silver. IMO, silver is "almost" as good. But the seriously rich and the central banks park their wealth in GOLD!
Do you think that you do not have enough money to buy gold? You can buy 1/10th oz Gold Eagles for about $190 at your local coin shop...
Gold is the best insurance against government mismanagement. And there has been a LOT of government mismanagement in the past, what, 40 years? And it is getting worse...
"Gold, get you some! -- "Aristotle"