Blog

December 16, 2009 – One of the best explanations of fractional reserves comes from a polemical essay written in 1995 by Murray Rothbard, one of the prominent champions of the Austrian School of Economics: “Banks make money by literally creating money out of thin air, nowadays exclusively deposits rather than bank notes. This sort ofRead more

December 13, 2009 – In my last commentary I asked “What’s next for gold?”  Answering my own question, I noted that “$1200-$1400 is a reasonable target for the end of this year, but first, it seems likely that gold will re-test support.” In fact, gold kept climbing to above $1200, so my timing was off.  OnlyRead more

I noted in the last commentary, the importance of resistance for the gold/silver ratio at 69. I even drew a red horizontal line at that level, which can be seen again on the accompanying chart. I also warned: “We simply have to stay alert for the possibility of a deeper correction.”

Gold has been pushed into an extremely oversold condition. Fortunately though, and quite remarkably given this relentless selling pressure, little damage has been done to its chart. So while gold  dipped back deeper than I expected, I think the worst is over and further, it looks like both precious metals (gold and silver) will bounceRead more

After the gold/silver ratio broke important support in the 68-69 area, it knifed down all the way to 61.7. The ratio has now bounced back up to test over-head resistance. I expect this test to be successful, and that the ratio will once again move lower.

Gold’s enemies, namely, those banks comprising the nefarious gold cartel and acting under the direction of the supra-governmental Exchange Stabilization Fund, are throwing everything they can at gold in an attempt to reverse its ongoing advance. Consequently, gold’s push to $1,000 has been halted by this intensifying resistance, but this setback is only temporary.

I continue to recommend that investors stay out of the stock market (except for my recommended stocks). Continue to hold ‘gold-cash’, not ‘dollar-cash’, thereby keeping your money safe and sound in bullion until stock prices fall to more reasonable levels when measured in terms of gold. I do not have any trading recommendations at the moment.

Gold has climbed higher as expected. Both precious metals now look ready to make new multi-month highs, but it is becoming increasingly clear that the gold cartel is pulling out all the stops to try keeping gold from climbing above $1,000.

Gold and silver have climbed higher as expected. Both precious metals now look ready to make new multi-month highs.

A number of key factors have fallen into place over the past couple of weeks. Unfortunately, together they increase the probabilities that the US dollar is headed toward hyperinflation.