Gold reaches new highs

The price of gold went over USD$1284 this week and this trend it set to continue. What are the reasons for this? It’s very likely that during the rest of 2010 we will see a worsening of the crisis. Billions upon billions of dollars have been swallowed up by the banks, billions and billions of dollars have been pumped into the economy to no avail. Unemployment hasn’t stopped growing, the US housing market remains depressed at historically low levels and one in five Americans is out of work. In the press this week there were reports that one in seven Americans is on the poverty line. This does not bode well. I think we are building up to a very dangerous time in the world economic and financial system.

Two years ago and repeatedly since then I have recommended that you put a good portion of your fiat money into gold and silver bullion and those that have heeded this advice have done very well so far. However, for those of you who think that gold is already much too high, think again. Yes, of course, like any precious metal it is volatile and it could go down to the $1100’s again, but it will surely rise again like the phoenix out of the ashes. So for those of you who are still on the fence, try to make a decision quickly as gold will go to $1500 and beyond within the next 6-9 months.