Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Buying a Custom Built Gaming PC From Overclockers.co.uk - 1. Delivery and Unboxing - 17th Feb 20
BAIDU (BIDU) Illustrates Why You Should NOT Invest in Chinese Stocks - 17th Feb 20
Financial Markets News Report: February 17, 2020 - February 21, 2020 - 17th Feb 20
NVIDIA (NVDA) GPU King For AI Mega-trend Tech Stocks Investing 2020 - 17th Feb 20
Stock Market Bubble - No One Gets Out Of Here Alive! - 17th Feb 20
British Pound GBP Trend Forecast 2020 - 16th Feb 20
SAMSUNG AI Mega-trend Tech Stocks Investing 2020 - 16th Feb 20
Ignore the Polls, the Markets Have Already Told You Who Wins in 2020 - 16th Feb 20
UK Coronavirus COVID-19 Pandemic WARNING! Sheffield, Manchester, Birmingham Outbreaks Probable - 16th Feb 20
iShares Nasdaq Biotechnology ETF IBB AI Mega-trend Tech Stocks Investing 2020 - 15th Feb 20
Gold Stocks Still Stalled - 15th Feb 20
Is The Technology Stocks Sector Setting Up For A Crash? - 15th Feb 20
UK Calm Before Corona Virus Storm - Infections Forecast into End March 2020 - 15th Feb 20
The Growing Weaponization of Space - 14th Feb 20
Will the 2020s Be Good or Bad for the Gold Market? - 14th Feb 20
Predictive Modeling Suggests Gold Price Will Break Above $1650 Within 15~30 Days - 14th Feb 20
UK Coronavirus COVID-19 Infections and Deaths Trend Forecast 2020 - 14th Feb 20
Coronavirus, Powell and Gold - 14th Feb 20
How the Corona Virus is Affecting Global Stock Markets - 14th Feb 20
British Pound GBP Trend and Elliott Wave Analysis - 13th Feb 20
Owning and Driving a Land Rover Discovery Sport in 2020 - 2 YEAR Review - 13th Feb 20
Shipping Rates Plunge, Commodities and Stocks May Follow - 13th Feb 20
Powell says Fed will aggressively use QE to fight next recession - 13th Feb 20
PALLADIUM - THIS Is What a Run on the Bank for Precious Metals Looks Like… - 13th Feb 20
Bitcoin: "Is it too late to get in?" Get Answers Now - 13th Feb 20
China Coronavirus Infections Soar by 1/3rd to 60,000, Deaths Jump to 1,367 - 13th Feb 20
Crude Oil Price Action – Like a Coiled Spring Already? - 13th Feb 20
China Under Reporting Coronavirus COVID-19 Infections, Africa and South America Hidden Outbreaks - 12th Feb 20
Will USD X Decline About to Trigger Precious Metals Rally - 12th Feb 20
Copper Market is a Coiled Spring - 12th Feb 20
Dow Theory Stock Market Warning from the Utilities Index - 12th Feb 20
How to Get Virgin Media Engineers to FIX Hub 3.0 Problems and NOT BS Customers - 12th Feb 20
China Under Reporting Coronavirus COVID-19 Infections by 66% Due to Capacity Constraints - 12th Feb 20
Is Coronavirus the Black Swan That Takes Gold To-Da-Moon? - 12th Feb 20
Stock Market 2020 – A Close Look At What To Expect - 12th Feb 20
IBM AI Mega-trend Tech Stocks Investing 2020 - 11th Feb 20
The US Dollar’s Subtle Message for Gold - 11th Feb 20
What All To Do Before Opening A Bank Account For Your Business - 11th Feb 20
How and When to Enter Day Trades & Swing Trade For Maximum Gains - 11th Feb 20
The Great Stock Market Dichotomy - 11th Feb 20
Stock Market Sector Rotation Should Peak Within 60+ Days – Part II - 11th Feb 20
CoronaVirus Pandemic Stocks Bear Market Risk 2020? - Video - 11th Feb 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

American's Striving to be Free

Commodities / Gold & Silver 2009 Aug 24, 2009 - 12:21 PM GMT

By: David_Vaughn

Commodities

Best Financial Markets Analysis ArticleWell, our world is definitely in the throes of wild and wooly change. 

The United States has begun losing its dreams.  It doesn’t even know how to dream anymore.  Its only goal is getting rich in the next bubble.  Its only hope is winning 1 million dollars by retirement.  Doesn’t want to make anything.  Doesn’t want to produce anything.  Walla!  Its dreams are being answered.  All the jobs are south and east.  So, with no worry over the difficult task of employment the US can concentrate on its hope of prosperity without producing anything.


Passed by an old European style café on the way to the coffee shop.  A Dutch restaurant with a German cook.  Excellent soups all made from old European and Dutch recipes.  It’s the small things in life that often bring sanctity for the soul.   The days now are getting shorter.  End of the summer season.  Can you believe it’s been close to a year since all the banks received their trillion dollar “stimulus package?”

The total accumulated national debt stands now at almost 12 trillion dollars - plus. The annual budget deficit by itself is expected soon to pass 2 trillion.  This is four times higher than last year. Well, we’ve definitely entered a new era.  Mind you…not moving toward, but quickly losing all the ground accomplished for these past 20 years.

A number of years ago noted conservative analyst Robert Shiller predicted the housing market would be the last sand castle to be washed away.  Robert, bravely and confidently predicted at the beginning of this decade that the once golden and ever climbing higher real estate market would crash.  At the time he was considered crazy and a prophet of doom.  An alarmist.  But those who listened to his advice and got out of debt are glad they took his advice seriously. 

"A reasonable case could be made," he says, "that even though past depression scares have proven to be unwarranted, this time it might be different." Robert Schiller

The White House is finally admitting that there is a substantial and extensive gap between its earlier rosy economic forecast and reality.  What?  Higher unemployment rates and  higher deficits all around.  A nightmare brewing?  Unemployment is headed to double digit figures and add to that the fact that unemployment benefits are rapidly coming to an end for the vast majority of those unemployed.  The administration apologizes for its earlier inaccurate forecast and blames it on incorrect information submitted by analysts.

“America, do you still dream great dreams? Do you still believe in yourself? Are you ready for a great national challenge?"  usatoday.com/tech/science/space/2009-07-19-apollo-crew

It seems those dreams are quickly fading away.  Are we ready for a great national challenge?  How about a challenge that will determine whether we will go bankrupt as a nation.  Can it really happen?  Just ask California Governor Arnold Schwarzenegger.         Arnold has even begun issuing “IOU”s instead of real money to its state employees. Remember all the talk years ago that the 401K was the road to great riches and wealth?  Just invest yearly in that 401K and you’ll be set for life.

“Sorrenti, who built homes that sold for up to $500,000, went from putting up five houses a year…to building none…”  “His plans for a comfortable retirement have crumbled. He and his wife of 28 years have lost more than a third of their 401(k) retirement savings in the recession”  "We were doing it right. ... I wasn't going to be a burden to anybody," he says. "It turned out nothing like we've been planning."   usatoday.com/money/economy/2009-07-20-gmtown_N.htm

Did you catch that last statement?  He and his wife were doing everything according to the cable financial sites.  And every bit of advice he listened to has cost him a third of his life savings. Many financial analysts are predicting that the United States is headed to significant inflation maybe starting in 2010.  The huge growing national debt demands it.  Inflation could easily hit double digits down the road. Gold is always the best investment during an inflationary era.

The town on San Pablo Bay just north of San Francisco filed bankruptcy as plunging property taxes crippled the town's coffers and left the city unable to make good on union labor contracts.  Lear Corp., which manufactures car seats and electronics, filed for Chapter 11 bankruptcy in July with $1.3 billion worth of assets and a whopping $4.5 billion in debt. 

What is the next crisis bearing down on us?  The next bust to come? 

Almost 700,000 Americans are soon to use up all of their unemployment benefits.  The national unemployment rate now hovers just under 10%.  Sounds like a looming crisis to me.  What happens when the last dollar disappears?  I have relatives myself who have lost their jobs and their home has depreciated by 40%.  This is happening all across the country.  Around 4.5 million people will lose all their unemployment benefits.  What comes next?  Selling apples on the street?  Increased soup kitchens across Middle America?

“Jim Rogers, retired chairman of Vancouver-based Rogers Group Financial, says advisors often suggest clients take a 5% or 10% position in precious metals as insurance…” “He says "a trillion dollar stimulus has to be inflationary…” “Since the future is unpredictable, I'd argue investors should be exposed to all of stocks, gold, real estate or REITs, cash and both nominal and inflation-linked bonds, as I am myself. How much of each can be decided after consulting with a trusted financial advisor.”  nationalpost.com/scripts/story.html?id=1794873

It is estimated that true year to year inflation is 7%.  As the years move forward we may see  inflation as we experienced in the 1970s.  No, this world crisis is far from over but continues to build up steam if only under the surface.  In this long term environment gold and gold related investments will always prove to be the better longer term investments. Today, do not consider the short term events, but continue to prepare yourself for the longer term events pending. 

When investing always consider well where the longer term direction of the economy and current events are heading.  You’ll hold on to your money longer if you think this way.  Warren Buffet is the master in determining long term events.  I'll give a plus here also for Wells Fargo Bank.  During the real estate boom Wells Fargo refused to provide sub prime loans.    And when the real estate bull crashed they were sitting on a lump of cash and calmly proceeded to purchase Wachovia Bank.  A long term disciplined approach is always the key to where to place your money. 

“Claymore Investments Inc. has raised $400-million for its new gold bullion fund -- an amount that could swell to $460-million, making it the largest structured product offering and one of the largest initial public offerings in at least two years.”  “The fund, which includes a number of novel features, including a hedge against the U. S. dollar, capitalizes on seemingly unquenchable thirst for the metal amid growing concern over inflation and the outlook for the greenback.”  “Claymore's deal is another example of the continuing love affair between investors and gold.”  financialpost.com/story

It is not the short term fluctuations to worry over.  Keep your eyes focused on coming events.  The longer term fundamentals are still eroding.  Every where I turn I continue to see homes foreclosed.  Even half a million dollar homes.  Tremendously successful and wealthy developers are going bust and one in particular I know has just lost his home to foreclosure.  And I remember this fellow used to carry around a minimum of 10 grand in cash in his pocket.  Unfortunately, he gambled heavily and lost his last gamble in a crashed real estate bust. 

Dennis Gartman continues to be the premier investment analyst to continue to listen to and to follow.  Gartman became a buyer of gold in late June 2009. So far this year government regulators have closed 72 federally insured banks because of a weak economy and increasing loan losses.

“Junior gold miners win respect again”  “Major comeback…”  “Many other junior golds are also trading around their highest levels in months (if not ever)…”  "It's tied to the fact that I think people are starting to see beyond the credit crisis…" “I think for those juniors that have good assets and have cash, there is a growing audience." “…for the juniors that have projects that are well-financed and are either in production or likely to be in the future, the enthusiasm is back.”  “While funds are putting cash back into the junior gold sector, they are also being selective about where it goes. Details like resource potential and political risk actually matter again, which was not always the case in the heady days of 2004 to early 2008.”  nationalpost.com/scripts/story.html?id, 6-10-2009

Now just may be the best time to take an evaluation of your family’s needs and begin planning for continuing erosion of our economic sector.  Striving to be free?  You will be free if you can continue to support yourself and not rely on a trillion dollar stimulus package.

Click here to order Gold Letter

Gold, accept no substitute.

Click here for a FREE gold report!!!

David Vaughn
David4054@charter.net

The future legacy of the United States will be the refined art of financial leverage.

© Copyright 2009, Gold Letter Inc.

“The Worldwatch Institute, an organization that focuses on environmental, social and economic trends, says the current rate of global demand for resources is unsustainable.”  

The publisher and its affiliates, officers, directors and owner may actively trade in investments discussed in this newsletter. They may have positions in the securities recommended and may increase or decrease such positions without notice. The publisher is not a registered investment advisor. Subscribers should not view this publication as offering personalized legal, tax, accounting or investment-related advice. The news and editorial viewpoints, and other information on the investments discussed herein are obtained from sources deemed reliable, but their accuracy is not guaranteed. © Copyright 2008, Gold Letter Inc.

David Vaughn Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules