Gold Locked in $10 Range
Yesterday, Gold hit a high of $566.10 and a low of $544.80. These are the high and low for the last 24 hours. It is now at $563.50. From appearances, Gold seems to be in a trading range between a support of $550 and a resistance of $560. Both have been breached a bit, but seem to be holding.
The range is rather tight and does not give much room for trading. As mentioned before, I am in an accumulation mode and have not begun to trade in and out again.
My preferences for the markets now are bullion silver and gold coins, mining stocks or mutual funds, and energy stocks or mutual funds. I also prefer the EURO, Swiss Franc, New Zealand Dollar, and the Renminbi. My currency investments are with everbank.com (world currency accounts). Remember, though, all currencies are unbacked paper and have only value relative to other paper currencies. All are subject to the whims of governments and central banks. My thinking is that the dollar has much more downside potential and the slide will increase during 2006.
Some last trade prices of my stocks are DROOY $1.94; CEF (Canadian bullion fund) $7.30;RNO $1.75; NEM $57.60;PHO (Water ETF) $16.56; PXE (Energy ETF)$18.55.
Those who a pushing for China to revalue the Renminbi are, in reality, seeking a lower valued dollar. Many of the same folks are professing to want a high valued dollar, but this is simply Washington Speak. Do not be deceived by the rhetoric. And remember, a lower valued dollar means higher prices for us.
Speaking of higher prices, I believe the time in not very far away when we will be longingly looking back on gasoline at $2.50. Then we will be paying $3.00 or more at the pumps.
Notice that China is seeking energy companies in Canada, Central/South America, Africa, and in the old USSR. They are wise to be using their dollars in this way. By the way, it is reported that China has made a deal with Iran for energy. This is practical wisdom in action. Do you believe they are going to be willing to share this energy with other countries of the world? Their people are buying cars in ever increasing numbers and their demand for energy is increasing rapidly.
All times of life are very interesting. Some are more exciting than others. Can you imagine gold at $800, $1000, or $1500? That may sound real exciting to those holding gold, but recognize that it will be a time when the purchasing power of the dollar is at an all time low. That means that all consumables which we need will cost more dollars than any other time in our lives. I can easily remember the time when a cup of coffee cost only a nickel with all the re-fills one could drink. Very often the coffee was free with the $0.75 - $1.00 lunch. Compare that with dollar prices today. Now think what the prices will be when the dollar has half, one-third, or one-fourth the present day purchasing power. Then you can realize that our standard of living will be much lower than today.
Let's examine our individual and family debts today while continuing to make the monthly payments. Consumer debts for daily living expenses, toys for young and old, fancy cars, and expensive vacations on credit cards are best paid off as rapidly as possible. Remember, if you only pay the minimum amount due, it will be years, if ever, until the balances are paid in full.
Longer term debts; such as, mortgages give options. (1) Continue as you are now, but that may not be the best. (2) If your note is relatively new, and advance payments are allowed without penalty, make extra payments of any amount you can scrape up each month to pay extra on the principal. This will save substantial dollars of interest and will pay the note off earlier. (3) If you are very wise and frugal, you could use fund you can force yourself to put aside and invest them in gold and energy assets. Then as the value of these assets increase as the dollar goes lower, you could cash in these assets and pay your notes off with the "cheap" dollars. Think over these, evaluate the potential and your own wisdom to make wise decisions.
The Bible tells us, "Owe no man anything, but to love one another: for he that loveth another hath fulfilled the law." (Romans 13:8) Thus, debt free living is the best course.
The range is rather tight and does not give much room for trading. As mentioned before, I am in an accumulation mode and have not begun to trade in and out again.
My preferences for the markets now are bullion silver and gold coins, mining stocks or mutual funds, and energy stocks or mutual funds. I also prefer the EURO, Swiss Franc, New Zealand Dollar, and the Renminbi. My currency investments are with everbank.com (world currency accounts). Remember, though, all currencies are unbacked paper and have only value relative to other paper currencies. All are subject to the whims of governments and central banks. My thinking is that the dollar has much more downside potential and the slide will increase during 2006.
Some last trade prices of my stocks are DROOY $1.94; CEF (Canadian bullion fund) $7.30;RNO $1.75; NEM $57.60;PHO (Water ETF) $16.56; PXE (Energy ETF)$18.55.
Those who a pushing for China to revalue the Renminbi are, in reality, seeking a lower valued dollar. Many of the same folks are professing to want a high valued dollar, but this is simply Washington Speak. Do not be deceived by the rhetoric. And remember, a lower valued dollar means higher prices for us.
Speaking of higher prices, I believe the time in not very far away when we will be longingly looking back on gasoline at $2.50. Then we will be paying $3.00 or more at the pumps.
Notice that China is seeking energy companies in Canada, Central/South America, Africa, and in the old USSR. They are wise to be using their dollars in this way. By the way, it is reported that China has made a deal with Iran for energy. This is practical wisdom in action. Do you believe they are going to be willing to share this energy with other countries of the world? Their people are buying cars in ever increasing numbers and their demand for energy is increasing rapidly.
All times of life are very interesting. Some are more exciting than others. Can you imagine gold at $800, $1000, or $1500? That may sound real exciting to those holding gold, but recognize that it will be a time when the purchasing power of the dollar is at an all time low. That means that all consumables which we need will cost more dollars than any other time in our lives. I can easily remember the time when a cup of coffee cost only a nickel with all the re-fills one could drink. Very often the coffee was free with the $0.75 - $1.00 lunch. Compare that with dollar prices today. Now think what the prices will be when the dollar has half, one-third, or one-fourth the present day purchasing power. Then you can realize that our standard of living will be much lower than today.
Let's examine our individual and family debts today while continuing to make the monthly payments. Consumer debts for daily living expenses, toys for young and old, fancy cars, and expensive vacations on credit cards are best paid off as rapidly as possible. Remember, if you only pay the minimum amount due, it will be years, if ever, until the balances are paid in full.
Longer term debts; such as, mortgages give options. (1) Continue as you are now, but that may not be the best. (2) If your note is relatively new, and advance payments are allowed without penalty, make extra payments of any amount you can scrape up each month to pay extra on the principal. This will save substantial dollars of interest and will pay the note off earlier. (3) If you are very wise and frugal, you could use fund you can force yourself to put aside and invest them in gold and energy assets. Then as the value of these assets increase as the dollar goes lower, you could cash in these assets and pay your notes off with the "cheap" dollars. Think over these, evaluate the potential and your own wisdom to make wise decisions.
The Bible tells us, "Owe no man anything, but to love one another: for he that loveth another hath fulfilled the law." (Romans 13:8) Thus, debt free living is the best course.
posted by Doug @ 10:33 AM
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