Gold and Precious Metals on the Move ?

June 30, 2008 | By | 2 Replies More

In European early morning trading gold and other precious metals have continued to prosper. Gold has held above $930 an ounce, spiking at $935 before falling back to just above $931, before renewing its assault on $934 an oz.

All the factors that we have mentioned in past weeks still hold good.

A plunging dollar, a soaring oil price and political and military uncertainty throughout the world and not forgetting the threat of food shortages and accompanying inflationary price pressures on man’s basic needs.

 

 

History is repeating itself as gold continues to be the currency of the last resort as global difficulties grow.

 

 

In the West we have enjoyed the most prosperous five decades in history.

Plentiful affordable food, rapid advances in technology that have made our everyday lives easier, with more entertainment, fast, cheap, safe and comfortable travel, exotic and out of season foods available at every corner store and less and less arduous working conditions than ever before.

Whether we can continue or regain the lifestyles we have taken for granted remains to be seen. The farsighted or lucky among us will continue to spot profitable opportunities and enjoy the goodies that wealth can bring.

The vast majority who are not favored by the gods can only hope that time will restore the benefits they have enjoyed for so long.

That the misfortunes that are beginning to envelop us lie at the door of politicians and world leaders that are either financially or morally corrupt or just plain stupid would be hard to deny.

As the crises looms our earnest hope is that a political figure of stature that is honorable and intelligent and capable of appreciating global implications instead of being insular in outlook will emerge to lead the world by example. We would like to think that Obama would come to the party but have serious doubts about him if the Clintons are in tow.

In the meantime we will keep our fingers crossed that things will not get worse and will soon return to normal, apologize if we have appeared too pessimistic, continue to buy gold and other commodities and be thankful that we are not Zimbabwean.

The people of that god-forsaken country have endured hardship that is almost impossible for westerners to come to terms with.

Their leader swans of around the world, owns estates in Scotland and other lands, looks as if all his bodyguards and acolytes are dressed by the worlds best tailors while his responsibilities to his countrymen are totally ignored.

Can’t help but think that our interference in Zimbabwe would have been much more appreciated by the locals, and over and done with in double quick time, than our Iraq and Afghanistan oil and terror inspired invasions.

As we write we see that early afternoon gold took a sharp drop in Europe to below $927 an oz. but quickly bounced back to over $931 an ounce within half an hour.

We suspect that a floor of around $930 an ounce is a good bet for the remainder of the summer. This could change should oil retreat or Bernanke shows some steel and supports the dollar but we believe that if either or both of these unlikely events occur gold and silver will sever the instep links with both within a few weeks of either event.

This will be due to the realization that the stock market will bomb and stay bombed for many a month and only commodities and energy, both in short supply, are the only viable investment options.   

 

 

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Comments (2)

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  1. David says:

    Quote “That the misfortunes that are beginning to envelop us lie at the door of politicians and world leaders that are either financially or morally corrupt or just plain stupid would be hard to deny.

    As the crises looms our earnest hope is that a political figure of stature that is honorable and intelligent and capable of appreciating global implications instead of being insular in outlook will emerge to lead the world by example.” Unquote.

    John,

    This is the crux of our global problems I fear. I have been following the progress of genetic science and the exponential advances are staggering to say the least.

    Within reasonable sight is the ability to develop a synthetic fuel, the advancements with solar energy which is doubling efficiency every 2 years and even more importantly the possibility of genetic modification to our leaders.

    For so long as our leaders are “human” and subject to re-elections they will think and act with very short term strategies, most of which are designed around their own personal short term gains and degrees of corruption.

    The only thing that provides me with any hope for my grandchildren is the thought that we may one day soon be able to modify God’s work to produce good in place of evil. And god gave us brains to use so let us use them in this respect to save a very very sad world which will otherwise self destruct.

    I fear that time may have run out for any such remedy but right now we need to release some of the handcuffs that burden our genetic scientists. These are the men and women who have it in their power to save our world. Politicians have proven that however sincerely a small % of them may enter the arena they soon degenerate to something below the value of vermin. A mere public pest one might say.

    I somehow doubt Obama will be the saviour we need. Indeed, it may well be impossible for a single man to save this world from the effects of prolonged corruption and evil. All leaders needs must be modified for the task at hand.

    RELEASE THE HANDCUFFS.

    David.

  2. John says:

    Hola David

    What a splendid idea – if only! Even better would be to genetically modify aspiring politicians as a condition of allowing them to seek election.

    I fear you are right about Obama but I was just clutching at straws.

    I think I am correct in saying that both American and British politicians have already put our grandchildren in hock and are expected to pick up the tab for the present profligacy. Great grandchildren next.

    I suppose the great intellects of our present leaders reason that allowing inflation to let rip will relieve the future debt burden and as they will be long dead they are not bothered about being bought to book for their illogical shortcomings.

    In the meantime they can continue to enjoy the present fruits of their policies and probably expect to be able to pass on enough of them to their sons and daughters so that they will avoid the holocaust that looks like falling upon the descendants of the average working citizen.

    In the same vein I believe it was a recognised policy employed by many leaders throughout history to go to war to avoid the threat of problems with their own people coming to a head and leading to their overthrow or civil unrest or even outright revolution.

    I suppose it would be a little far fetched to think that this is George´s tactic but then you never know about someone who is far from the sharpest tool in the box!

    Oh well I can only dream on. Your thoughts have inspired me to open my mind to all sorts of far fetched scenarios. My imagination is running riot.

    You should know that I am in complete agreement with you previous post but If I may add a note of caution beware of missing out on golds next move.

    So far It has defied many technicians expectations but to be fair much seems to depend on which set of the multitude of indicators are being perused. I have added to my holdings as I do not anticipate a significant drop below $900 an ounce and suggest that support for the summer period is likely to remain between $910 -$920 before the next upward surge.

    I know Mr Market does have a nasty habit of proving me wrong on too many occasions which is why I am not endowed with riches but unlike our revered leaders, I am not responsible for any debts or unnecessary deaths.

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