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May 14, 2010

1

Buy Gold On Dips

by oakley711

Wire gold

Wire gold

I think that the argument for de-coupling of gold and the Dow (or more accurately perhaps the Wilshire 5000) is reasonable when volatility is trending upward. When this is not the case, we’ll still see stable or even a slight downtrend in gold. This then is the short-term case.

Long-term, debt is still increasing unsustainably (though recent U.S. trends have shown a slight decrease in the rate of debt growth). As such, this debt must be monetized at some point. The most likely scenario for this monetization is devaluation (unless you really believe that spending cuts or tax increases are viable…a possibility in the short-term but not in the long-term). Thus, the long-term case is for gold appreciation.

Bottom line: Buy gold on short-term dips at momentum inflection points (i.e., after a short-term dip begins to turn).

California Crystalline gold


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1 Comment Post a comment
  1. May 14 2010

    Yes buy gold; most analysts suggest 5-10% of your portfolio should be gold- in these times you should actually be over weight in gold.

    Arizona silver

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