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Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Bernanke Sets Gold and Other Commodities on Fire

Commodities / Commodities Trading Nov 08, 2010 - 07:48 AM GMT

By: Larry_Edelson

Commodities

Best Financial Markets Analysis ArticleBen Bernanke has unleashed the most powerful forces on the planet.

More powerful than any government. More powerful than any other central bank. More powerful than even the President of the United States.


He has ramped up the printing presses and will now print at least $600 billion of new money — and reinvest the interest the Fed is already receiving on money it printed previously (used to buy bonds) — to buy even more bonds (and print even more money).

All told, the Fed will be printing as much as $100 billion of new fiat money, per month. And that’s just for QEII!

Why do I say just for QEII? Because I have no doubt in my mind whatsoever that in the not too distant future — the Fed will find that it must print even more money, and up the ante yet again.

Make no mistake about this: As I told you from the get-go of this great financial crisis, Bernanke’s ultimate agenda is to massively devalue the U.S. dollar to inflate away debts … push up asset prices … and spark a major round of inflation.

Bernanke's ultimate agenda is to massively devalue the U.S. dollar to inflate away debts.
Bernanke’s ultimate agenda is to massively devalue the U.S. dollar to inflate away debts.

Bernanke, more than any other central banker, is deathly afraid of a deflationary spiral. He will do anything he deems necessary to avoid it. He has virtually unlimited powers at his disposal.

Already, the markets are on fire!

As I write this issue …

arrow black Thank You Ben Bernanke! Gold has hit a fresh new record high at $1,393, including a nearly $60 move up in the 24 hours after Bernanke’s announcement.

arrow black Thank You Ben Bernanke! Silver has exploded to over $26 an ounce, with a single day rally of almost $2, or nearly 6% — I repeat, in a single day!

arrow black Thank You Ben Bernanke! Copper is also soaring, now trading at nearly $4 a pound and up more than 8% just since the first of this month.

arrow black Thank You Ben Bernanke! Platinum, soaring more than $100 an ounce on November 4, to near $1,800! Palladium is also on fire, now fetching $678.97.

It’s not just metal prices that are exploding higher on Bernanke’s deliberate attempt to create inflation … to devalue the dollar … to inflate away the massive mountain of bad debts in this country.

arrow black Thank You Ben Bernanke! Oil is now trading at nearly $87 a barrel, up almost $7 — more than 8% — in just over a week.

arrow black Thank You Ben Bernanke! Coffee was up an amazing 6.7% in a single day!

arrow black Thank You Ben Bernanke! Wheat is flying, now at more than $7.20 a bushel — up 5.8% on Bernanke’s announcement.

arrow black Thank You Ben Bernanke! Soybeans, at $12.83 a bushel, up 5% since the announcement.

arrow black Thank You Ben Bernanke! Sugar at 31.74 cents per pound, up 5.7% in a single day!

Your average gold mining share — up more than 5% the day after Bernanke’s announcement — is now up more than 83% since the first of this year!

Emerging markets are also on fire, throughout Asia and even Latin America. Why?

The answers simple: As the dollar gets devalued, savvy capital is seeking out the high economic growth of emerging market economies, which have hardly skipped a beat throughout this entire financial crisis.

Am I excited? You bet I am! This is ALL precisely what I have been predicting from the start of the crisis … and it is unfolding exactly as I said it would.

But more importantly, for those of you who have been following my recommendations here and in Real Wealth Report — you’re making money hand over fist!

All this is why I say “Thank you Ben Bernanke!” For savvy investors who see through his actions, it is a watershed of humongous profit potential.

In the weeks and months ahead you will see the following …

A. The underlying U.S. economy will NOT improve, and will instead, sink further. Unemployment, sadly, will worsen.

B. The U.S. dollar will come under further attack, by sovereign wealth funds exiting dollar investments and seeking out the safety of their home currencies, gold and other natural resources, tangible assets.

C. A new round of the just started currency wars, where countries that are experiencing huge capital inflows (due to the falling dollar) will take measures to try and prevent their currencies from rising too much.

D. New trade friction between the U.S. and China. And within one year I predict that China will abandon its peg to the dollar and revalue its currency higher.

E. One new record high after another in gold. Yes, there will be inevitable, and often sharp, pullbacks in the yellow metal.

Gold is on its way to at least $2,300 an ounce.
Gold is on its way to at least $2,300 an ounce.

But I have absolutely no doubt whatsoever that gold is now on its way to at least $2,300 an ounce, and far more likely $5,000 an ounce by late 2015.

F. Oil prices march back over $100 a barrel, likely hitting $125 a barrel next year, and then, by 2015 — well over $200 a barrel.

G. Prices of virtually every natural resource on the planet soar to new record highs, leap-frogging each other higher in the weeks and months ahead — all the way through to 2016 — when final highs are due.

H. The demise of the U.S. dollar as the world’s reserve currency. By 2016 you will see a new world currency emerge for international trade and finance, replacing the dollar.

And more, lots more.

My advice: Doing nothing with your savings and your investments is just about the worst mistake you could make.

Keeping it in a bank, a money market, or even under your mattress will doom what savings you do have to rapid devaluation.

Please don’t be one of those investors. Please don’t listen to the typical advice on how to keep your money safe.

It won’t work this time around. Not when the very basic cornerstone of your wealth — the dollar, your medium of exchange for goods and services — is being devalued right before your very eyes.

Stay tuned, and hold any and all investment recommendations I have made in this column!

Best wishes,

Larry

P.S. There has never, I repeat NEVER, been a better time to become one of the savvy members of my Real Wealth Report. Join now for a mere $99 a year — the single best purchase you can make for your investment funds. I guarantee it. Click here now to join.

This investment news is brought to you by Uncommon Wisdom. Uncommon Wisdom is a free daily investment newsletter from Weiss Research analysts offering the latest investing news and financial insights for the stock market, precious metals, natural resources, Asian and South American markets. From time to time, the authors of Uncommon Wisdom also cover other topics they feel can contribute to making you healthy, wealthy and wise. To view archives or subscribe, visit http://www.uncommonwisdomdaily.com.


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