There is every indication that the gold market is poised to shift into high gear this week, when the price of gold climbs past $1500.
Posted by Adam King on April 18, 2011
Don’t be left behind when the gold market breaks away.
April 18, 2011 – There is every indication that the gold market is poised to shift into high gear this week, when the price of gold climbs past $1500. And investors who hold back until gold hits its breakaway price will surely regret their hesitation.
The fact is that the Fed’s irresponsible policies are rapidly catching up with us. Today a Markets Alert from The Wall Street Journal says Standard & Poor “cut its outlook on the U.S. to negative, warning that the U.S. fiscal profile may become ‘meaningfully weaker’ than that of other major countries if policy makers can’t tame the budget deficit.”
The odds are very slim that our politicians will be able to get the budget under control. Rasmussen Reports points out that even under Congressman Ryan’s alternative it would take at least a quarter century to balance the budget Both the Dow and S & P reacted with the biggest drop in almost a month while gold surged to just a few bucks short of the $1500 mark. More significant, the yield on 10-year Treasuries climbed to 3.432% and 30-year notes were down nearly a full point to yield 4.526%. That deals an immediate blow to the housing industry and will add billions to our debt. The dollar also fell, down another 0.5% against the yuan since last Friday.
Europe also took another hit last Friday as Moody’s dropped Ireland’s rating to just one notch above junk status. And In March China’s year to year growth in CPI shot up to 5.4%, 10% over February’s figure and a strong signal that the country’s tight monetary policy is unable to hold back inflation.
At some point big investors will have to face the brutal facts and turn to the gold market for shelter. In fact, the movement is already in its early stages. “Investors are frustrated with U.S. monetary policy. They’re saying the heck with the dollar, the heck with currencies and they’re buying metals,” Ira Epstein, director of the Ira Epstein division of the Linn Group, told the Wall Street Journal.
Once the floodgates open there will be no holding the gold market back. Individual investors who didn’t heed the warning signs and buy gold before that happens may find that they missed their best opportunity to secure their wealth.
Stewart Lawson
Senior Staff Writer – Certified Gold Exchange
Categories:
US Gold Market
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