Tuesday, January 11, 2011

You'd be crazy not to own Gold...

Gold will eventually rally exponentially and investors who don't own the precious metal are "insane," and may be showing "masochistic tendencies," Robin Griffiths, technical strategist at Cazenove Capital, told CNBC.
CNBC
The words of a technical strategist, however the message rings true.

Robin comments that the downtrend in the dollar is powerful and it's important to close dollar (USD) positions on any rally. Also he comments that base metals are a worthwhile buy based on their breakout to new highs.

Dollars continue to be printed. Only the other day Geithner wrote a letter in support of increasing the US debt limit (again!).
Geithner Urges Debt Limit Increase, Warns of Default

Jan. 6 (Bloomberg) -- Treasury Secretary Timothy F. Geithner said lawmakers must raise the federal borrowing limit in the first quarter of 2011 or risk a default on U.S. debt and a loss of access to global credit markets.

A failure to act would cause “catastrophic damage to the economy, potentially much more harmful than the effects of the financial crisis of 2008 and 2009,” Geithner said in a letter to Speaker of the House John Boehner, Senate Majority Leader Harry Reid and all other members of Congress. Lawmakers should act before a default becomes “imminent” because damage from even a short-term disruption “would last for decades.”

Bloomberg
I have a feeling that someday soon the American people will stand up and say "enough is enough" and force the hand of US Congress/Treasury to stop allowing further debt to accrue. If not the American people, then China or other foreign entities purchasing their debt. It's by that point you would want to ensure you had sold your dollars and bought Gold.

Here's a polished little video that's doing the rounds. Food for thought and it presents some interesting facts...

 

BB.

Disclosure: Positions held in Gold. Not investment advice. Do your own research.

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