The price of the precious metals are falling. That is because there is a six month cycle exerting a downward influence on both. The time to backup the truck is coming. In this article I take a look at where we are in that cycle now.
The Commodity Futures Trading Commission was given broad powers – by last year’s Dodd-Frank Wall Street Reform and Consumer Protection Act – to restructure the futures and over-the-counter derivatives markets. And Gary Gensler, appointed to chair the commission in May of last year, is known to be something of an activist.
Gold blasted through $1380 early this morning! Your gold bullion pile, marked to paper currency model, just rose by approx. 1.5% in value from the $1360 area lows! Good news, and, perhaps, congratulations to you.
The Federal Reserve’s Vice-Chair Janet Yellen provided a spirited defense of the Fed’s quantitative easing program at the American Economic Association annual meeting last week. She laid out what clearly seems to be the conventional wisdom inside the Fed as to the effects of its crisis programs, the results of the current additional $600 billion of additional asset purchases, and the hoped-for path of employment flowing from those policies.
Sometime between early February and early April the market should drop down into a major yearly cycle low. Last year that cycle low came during the first week of February.
Let the truth be known, the world is being held hostage by powerful bankers. Thanks to the fiat-money fractional reserve system, bankers have become the ruling elite and as a result, entire nations are going bust.
I began writing this note on New Year’s Day; the holiday season is over all too early for me as I contemplate the coming year. Along with other investors, I have many worries, but at the top of my list is the budget battle that will be fought in Washington, every state capital and most capitals of high-income countries abroad. As I finish this note, Republicans are now in charge of the House of Representatives.
Economic growth will be fine. The debt overhang will be handled by continuing and accelerated quantitative easing. Looking ahead, we are quite optimistic about demand for stocks, gold, and commodities in 2011.
Good afternoon. It is a pleasure to return to the Empire Club to discuss the outlook for gold and precious metals in 2011. I know this may appear to some to be an enviable job—getting to speak about the one asset class that seems to continually out-perform all others year after year—but it is a double edged sword.
