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Gold continues on its exciting run.
Even the threatened IMF gold sells have failed
to slow gold’s momentum.
Winter continues beating down on us providing colder and colder days
here in the south. The mountains
receive the snow but the Piedmont remains
clear.
Well the last of the democratic nominations
are winding up. How will gold be
affected regardless of who enters the White House? Who ever enters the house on the hill
will have no strategy except to continue the present course which is unabated
money creation which in turn leads to greater inflation.
WASHINGTON —
Consumer confidence plunged to the lowest since the onset of the Iraq war in
2003, while wholesale inflation surged to the highest yearly rate in a
quarter-century, according to Tuesday reports offering fresh evidence the
economy is teetering near recession.
Also Tuesday, a closely watched index indicated U.S.
home prices dropped 9% in the final quarter of 2007 from a year earlier.
That's the steepest decline in the 20-year history of the
S&P/Case-Shiller home price index. USA
Today, 2-27-2008
And greater inflation all by itself leads to
higher gold prices. There are so many negatives impacting our economy today
that no one seems to be able to grab a handle on either one of them.
“The restaurant
industry has fallen, and it can't get up. To add insult: The worst may be yet
to come. Same-store sales are sliding. Commodity prices are climbing. Units
are closing. Customers are dwindling. Some of the top names in all ends of
dining are in pain, from Starbucks (SBUX) to Applebee's to The Cheesecake
Factory (CAKE)."Whether or not the rest of the economy is in a
recession, the restaurant industry certainly is," says Ron Paul,
president of restaurant researcher Technomic.” The financial squeeze is
hitting hardest at dinner. Dinner traffic fell 2% last year, says research
giant NPD Group. Lunch is slowing, too, says Dave Jenkins, president of NPD's
U.S.
foodservice business.” "In the lifespan of casual dining, we
haven't seen economic times like this," says Marc Buehler, CEO of Lone
Star Steakhouse, which just closed 27 of 179 stores.”
USA TODAY, 3-3-2008
The biggest crisis I continue to observe is
the destruction of the US dollar.
Of course the European tourists love this because their Euro is
stretched so much further.
"The recent string of U.S.
data has been appalling and this is putting significant pressure on the
dollar and supporting gold," said Mark O'Byrne, executive director at
Gold and Silver Investments Ltd., in a note. On Wednesday, gold rose $12.10,
or 1.3%, to end at $961.0 an ounce.” Market Watch, 2-28-2008
The consumer price index has dropped to a low
of 75 as consumers lose more and more confidence in the economy. I believe the greatest shock to the
American consumer is the destruction of his home as his personal bank and
line of credit.
“U.S. home prices
plummeted at the end of last year, and bank seizures of property nearly
doubled in January, indicating that the housing slump is deepening. Home
prices suffered their biggest fourth-quarter drop since 1991, the Office of
Federal Housing Enterprise
Oversight said. The S&P/Case-Shiller home-price index showed prices in 20
metro areas fell in December by the most on record. Repossessions rose 90% to
45,327 last month from the same period a year ago, RealtyTrac reported.
"All the news we're getting is pretty dark," said Celia Chen,
director of housing economics for Moody's Economy.com. "Prices will
continue to fall for the rest of this year because increasing foreclosures in
turn increase inventories." ABC New, 2-27-2008
Home prices are slipping across the nation and
so many mortgage holders are watching their mortgage rate climb dramatically
higher. Maybe that bigger hose
with the three car garage wasn’t worth it after all. This is the biggest shock to America
now. The inability to consider
their home as an investment that only climbed in one direction.
Jim Rogers – “If
I'm not making myself clear, let me say it, you're going to see exactly the
same thing. You're going to see worse recession -- worse inflation, the
dollar's going to go down even more than it did in the '70s. In the '70s, America
was a creditor nation still, now we're the largest debtor nation in the
history of the world. So you're going to see worse inflation and, ultimately,
a worse recession because the dollar is going to be under serious
attack”.
We keep hearing about the dollar and honestly
I have no idea what the bottom will be.
I can say with certainty that I don’t think the bottom has been
reached. Are you preparing for liftoff?
Actually many would find that a dumb question since we are a little
over 30 dollars from reaching and surpassing 1,000 dollars an ounce. I still do not believe this run up to
be a simple rally. I believe what
we are witnessing a commodity that has been artificially held down for over
20 years and is just now finding its true equilibrium. Long term I believe gold will climb
higher still. Where it may
eventually settle down at I have no clue. All I know is that right now it is
climbing higher and higher.
Personally, I think a lot of folks have become bored with gold. Where is the excitement anymore? It only goes up and refuses to be held
down.
Think long term, always longer term. The price of gold in the short term
will move in extremes in every direction but gold will be overall strong for
the rest of this decade and beyond.
It’s not too late to invest in gold related equities to take
advantage of their wealth generating attributes. We are living in the last days of
cheap resources and cheap commodities.
Gold Letter, Inc. reviews undervalued gold stocks poised to rise in
this time of increasing demand.
Click here to order Gold Letter
Don’t forget to
email me !
By : David Vaughn
Editor, Gold Letter, Inc.
www.goldletterdv.com
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