The Dollar Breakout and the Gold Wall of Worry

Followers of the Forex markets will have seen a decisive trend reversal on the part of the dollar last week. EURUSD has definitely broke its upward trend as has AUDUSD and USDCHF has reversed its downward trend. Rumblings in Greece or debt default can be seen as a cause and many are anticipating a stock market downturn in the new year accompanying an ever strengthening dollar as money looks for safe havens and the market clamors for $$$ to pay back leveraged positions.

So what about gold. The fall back from the $1224 high has been met with much pessimism amongst commentators as people fear that any repeat of last years credit collapse will bring a collapse in the price of gold as people try to sell anything and everything to pay back leveraged positions.

Only time will tell but one thing that has been mentioned a fair bit is that Bull Markets climb a wall of worry and that Bull Markets manage to take as few people with it as possible ( Richard Russell). Before we reached the high of $1224 there was nt much optimism in the gold market as many newsletter writers were predicting a collapse down to $800 or less and there is even less now on the pull back so this could be a bullish signal.

A debt default in Greece could cause similar sovereign defaults in other parts of Eastern Europe shaking the banking system to its very core. Gold may be seen as the only safe haven as people question all sovereign debt and the banking system - as happened in the 1930s

The Indians and Chinese have shown a large willingness to buy gold at $1040 so any rush of gold into the market could be met with their buying.

In last years sharp gold fall yes you suffered if you were dealing in $$$. But gold did not really drop far for very long against the Pound and the Euro - which will most deifintely suffer in any credit collaspe.


Gold is insurance - so yes it may drop to $650 but for those who have the long term in mind, who see it as insurance,who know the scenarios they are insuring against this should be of little consequence.

Gold & Precious Metals Related Books

The CPM Silver Investing Yearbook - excelent read for anyone looking to invest in silver.

Eric King interviews Jim Sinclair

Great interview with legendary gold investor Jim Sinclair by Eric King on www.kingworldnews.com.

Gold vs the Dollar - Store of Value

Great interview with Market Technical Analyst Louise Yamada interviewed on Jim Puplava's Financial Sense today. She pointed out that in 1920 a $20 gold coin would buy you a man's suit as would a $20 note. Today that $20 gold coin is worth over $1000 and would still buy you a man's suit whereas the $20 would buy you a pair of socks.

Gold is the ultimate store of value - it retains its purchasing power over time.

Catch the whole interview at www.financialsense.com

Tips on Gold Confiscation

Silver Investing - The Case for Junk Silver

The term Junk Silver commonly refers to old US dimes quarters and halves that were at one time made of 90% silver.
• 1964 Kennedy Half Dollars
• Roosevelt Dimes
• Mercury Dimes
...to name just a few.

For the experienced metals investor and the beginner alike it makes sense to own a quantity of these. They will always reflect the pice of silver, but they are small denominations which means as a crisis hedge they are easy mode of bartering. (Even one ounce of silver is worth $20 so do you really want to have to exchange one of these for a loaf of bread whereas a silver dimes currently as spot value of around $1.40).

These coins were issued by the US mint so you can more or less trust their silver content. As they will always reflect the price of silver you do not need to worry too much about the quality of the coin (unless of course they have huge chunks taken out of them!!!) but make sure that if you do not pay a premium higher than 15% for smaller quantities.

A good place to buy your junk silver is on Ebay. They generally have a lot of offers for silver dimes and kennedy half dollars. The In Gold We Trust Precious Metals Calculator and Metals & Coin info page are a good place to start. There is a list of the different junk silver coins their silver content and the calculator will inform you of their current market value. You can then go onto Ebay and place bids maximum 10-15% over spot. One trick is to place a lot of different bids at the spot price of silver. You may get 1 or 2 that you win and you get it at a good price. Good luck and visit www.in-gold-we-trust.info for more info and resources.

BUY JUNK SILVER COINS

Gold and The Central Banks

Great article on Gold and Central Banks from Safehaven