Central Banks Moved to "Save" the Markets
By now, you should have read that the central banks of the world moved in with billions of dollars to "stabilize" world markets. This, of course increased the supply of currencies throughout the world. As the supply of currencies increases, they lose purchasing power.
The resultant loss of value increases prices. There was an article today on the internet in which "White Gold" was discussed. The author said that the price of milk was greater than the price of gasoline. He suggested, with tongue in cheek, that we should drink gasoline rather than milk. Remember, that such increases in price is not due to an increase in the value of the product, but rather a decrease in purchasing power of the unbacked currency. Always keep in mine that there are no currencies in the world which are redeemable in precious metals. Thus, all are unbacked with other than the full faith and credit of the issuing entity.
The prices of the precious metals (gold @ 669.20 and silver @ 12.72) do not reflect this loss in purchasing power of the dollar. The prices of the mining stocks are under pressure now, as well. The dollar has regained some strength against the other currencies and precious metals presently. However, this is very likely to be temporary. The long term trend of the dollar remains downward. You can be certain of this.
What is one to do in these markets? I am examining the financial markets, consulting with others, reading many newsletters, and am to visit with my son this week to gain more insight. From what I see, Asia and, particularly, China is the place for further investment, but now is the time to stand aside and wait for better buying opportunities.
I believe the precious metals will be much higher later this year, but they may go lower during the next few weeks or so. These will retain value over time as has been proven over centuries. More of them is not being made, and by the way, less is being mined at present.
Study, make your plans, commit them to the Lord, and patiently wait for His results. Praise Him for the results!
Best to each, Doug
The resultant loss of value increases prices. There was an article today on the internet in which "White Gold" was discussed. The author said that the price of milk was greater than the price of gasoline. He suggested, with tongue in cheek, that we should drink gasoline rather than milk. Remember, that such increases in price is not due to an increase in the value of the product, but rather a decrease in purchasing power of the unbacked currency. Always keep in mine that there are no currencies in the world which are redeemable in precious metals. Thus, all are unbacked with other than the full faith and credit of the issuing entity.
The prices of the precious metals (gold @ 669.20 and silver @ 12.72) do not reflect this loss in purchasing power of the dollar. The prices of the mining stocks are under pressure now, as well. The dollar has regained some strength against the other currencies and precious metals presently. However, this is very likely to be temporary. The long term trend of the dollar remains downward. You can be certain of this.
What is one to do in these markets? I am examining the financial markets, consulting with others, reading many newsletters, and am to visit with my son this week to gain more insight. From what I see, Asia and, particularly, China is the place for further investment, but now is the time to stand aside and wait for better buying opportunities.
I believe the precious metals will be much higher later this year, but they may go lower during the next few weeks or so. These will retain value over time as has been proven over centuries. More of them is not being made, and by the way, less is being mined at present.
Study, make your plans, commit them to the Lord, and patiently wait for His results. Praise Him for the results!
Best to each, Doug
posted by Doug @ 9:26 AM
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