Tag Archives: eurozone

No one can predict the future. The Central Banks can’t. The “experts” in the media can’t. We can’t. But what history has proven is that paper currencies and paper assets can be worth no more than the paper they’re printed on. Gold and silver are real, tangible assets that WILL ALWAYS HOLD VALUE. Central Banks know it. The “experts” know it. (Even if they don’t always admit it.) We know it. You know it too.

With the Dow crossing 14,000 and investors seemingly infatuated with the stock market’s latest rally in the last few weeks, gold closed sideways last week and finished at 1,668.25. But before anyone falls too hard for stocks, some perspective may be in order. First, red flags and “sucker alerts” abound as reports surface that insiders have been nine times more likely these past few weeks to sell shares of their companies than to buy new ones. This doesn’t bode well for the long term, not when insider selling usually foretells a drop in the markets. Second, put the value of the Dow today against the price of gold – despite this rally – and the Dow is down since 2009. The moral of the story? An abrupt end to this “sucker” rally could be near. But even if stocks continue to grow, history suggests that gold is likely to continue to outpace them. Keep your eyes wide open.

With gold prices pinging around like a thought in a schizophrenic’s head, the real story this week is profit taking from gold and silver backed paper holders who are scrambling to get out of the way of the Eurozone meltdown. Gold closed down on Friday at $1,660 with silver making a lateral move closing down at $31.50. After a downgrade from Moody’s, Commerzbank in Germany announced the slashing of 6,000 full time jobs by 2016. Italy’s Unicredit is following suit with a shedding of 1,000 employees of their own. There are known issues in Asian investment banking and the “perp walks” have started for the Libor scandal. Emerging markets are trying to avoid joining in the currency battles initiated by all the quantitative easing of more advanced economies. Thailand is running a surplus, and will seek to create a “pleasant deficit” by shoring up its infrastructure to ease the pressure on its business community. Those addicted to the fast pace of burning paper are rabidly jumping from one investment vehicle to the next, trying to outpace everything from conversations on the U.S. debt ceiling to the IPO freeze in China. Those who possess gold can sit back and enjoy the show in peace. The fools are rushing out.

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