Precious Metals Go Up - Euro May Be Losing Steam

This graph was received from www.worldcurrencywatch.com this morning and points to a real possibility that the Euro is in for some rough times ahead. A double top is a warning, a double to is a louder warning. This also points out that the dollar may do better in the short run, certainly, in comparison with the Euro. This is an interesting change in a lot of folks thinking. I moved from Euros to Metals Select gold and silver last week. Believe that I mentioned that move to you.

I still like the Chinese Renminbi, Swiss Franc, and the Japanese Yen. I use www.everbank.com World Markets for the currencies and the Metals Select accounts.

There is an increase in the news about the recent runs of the precious metals. Of course, the vast majority of the people in America are behind the times in appreciation of gold, silver, and platinum. If you are reading this, you are way ahead of most of our citizens. The precious metals have proven over the centuries to be a valid store of value, particularly, against the unbacked paper currencies of the world.

"High gold prices, supported by supply and demand fundamentals, has prompted Merrill Lynch analysts Monday to substantially increase gold price forecasts to an annual average of $1,000/oz by 2009." from www.mineweb.com this morning.

All that is lacking for the precious metals to reach the third phase when all want to jump aboard is more news. When it is the topic of conversation by virtually everyone, the panic will hit very soon. More news, as that above, will certainly be heard by ever more people.

Some folks may be waiting for a correction for purchases of the metals, but corrections seem to be very short lived and not as severe as in the past. Current prices are Silver 17.22, Gold 906.40, and Platinum 1923. Platinum seems on it way to 2000 in the next few days. I expect to see Gold at 1000+ this year, perhaps by early spring. That, of course, is speculation. However, it is likely well to add to holdings with every correction, regardless of how low it gets.

The precious metals are in a long term bull market which has yet to pick up real steam. It is coming, though. Silver and platinum are still sprinting ahead of gold. One must understand that of the three, gold is a greater threat to banks and central governments. They fear a return to a gold monetary system, because it threatens their monopoly on the paper currencies.

The mere rumor of a nation, such as, China, considering a return to gold backing of the Renminbi is anathama to the other banks and nations of the world. That rumor does exist. Is it just rumor? At this point, I imagine it is, but it is within the realm of possibility. Wow, what a boom that would be for the Renminbi! Can you imagine the Renminbi being the most desirable currency in the world. It would be were it convertible, or at least backed by gold.

The general stock market is showing some signs of life with the DJI up 156.40, at present. It has been difficult to see which way it will go. If the dollar does begin to appreciate against the Euro and the ECM continues to be troubled, we could see the DJI take on real life again. We must wait and see.

Thank goodness that our God is Sovereign in everything. I would hate to think that I had control of markets. You can just imagine the mess I or any other man would make of it. In is also a blessing the Jesus Christ loves us with a love we can only begin to appreciate, but not fully understand. He calls us to love one another as He loves. What wonderful promises are to be found in His word! These give us strength and hope even in times of great challenge.

Best to each, Doug