GOLD AIMED AT $6500/OZ, SILVER ..... $600/OZ

By Greg McCoach

Get ready. We are now entering the final stages in the collapse of the U.S. dollar...
And it's not going to be pretty.

The massive increases in money supplies will tank the value of the dollar and erode the very fabric of America's economic security.

As a result, gold and silver prices are will no doubt skyrocket, despite the short-term major volatility we've recently seen.

Many investors have been rushing to me asking if it's too late to buy precious metals with gold in the $1,500/oz range and recently spiking to nearly $50/oz. I keep telling them the same thing...

Despite whatever the price of gold or silver is today, both metals will be worth more than twice as much within 12 months.

That means $3,000 gold this time next year! After that, I think gold could break $6,500 an ounce.

And as you know, silver's gains will be much greater. When the bull market is all said and done, there's no doubt we could be looking at silver prices exceeding $600 an ounce.

And we can all thank the crooks in D.C. for it...

In his first ever press conference after a policy meeting two weeks ago, Bernanke told us all the ways he has saved our economy.

What a crock!

The Federal Reserve can't prevent the coming financial meltdown.
So far this year, the U.S. Treasury has raised $293 billion in net cash by selling debt securities. And so far this year, the Federal Reserve has purchased a net $330 billion of Treasury notes and bonds.

This translates to the Fed providing 100% of the net new cash the Treasury has raised this year — plus another $37 billion needed to mop up even more mess!
But who will buy Treasuries when the Fed doesn’t? China? Germany? Japan? You? Me?

Going to Hell in a Hand Basket

We are now getting very close and even accelerating toward the end game for the U.S. dollar and the American Empire as we know it. Have your life boats ready.
It won't be much longer before people really start buying both gold and silver to protect themselves from this enviable collapse.

The only way out of our dilemma, absent very large entitlement cuts, is to default in one (or a combination) of four ways:

Outright via contractual abrogation (surely unthinkable)
Surreptitiously via accelerating and unexpectedly higher inflation (likely, but not significant in its impact)
Deceptively via a declining dollar (currently taking place in front of our very eyes)
Stealthily via policy rates and Treasury yields far below historical levels (paying savers less on their money and hoping they won’t complain)

I would bet on a combination of deception, betrayal, and trickery.

Following the Smart Money

This past month, the University of Texas bought a billion dollars' worth of gold and is having it stored in a private depository. This is huge news.

More and more, the intelligent group of our population is starting to figure things out. Unfortunately, however, the unsuspecting masses are being led perfectly by the well-oiled government/media propaganda machine like sheep to the slaughter.

This is going to be a terrible reality for so many unfortunate Americans who have no idea as to what is coming shortly down the road.

And you can rest assured the politicos in Washington will do what all politicians do when they are trapped in such a manner: lie, cheat, steal, spin the facts, cover their asses at all costs, abuse their power, and misinform on a massive scale.
But even with the help of the government-controlled media, the time of consequences can no longer be held at bay.

Free market forces will win; governments, banksters, and their power structures will come tumbling down just as we have been seeing elsewhere around the world these past six months.

The spoils will go to those who were prepared and understood the debacle years before it hit.

The precious metals and the junior mining shares will reward those who understood, and punish those who didn’t.

Yes, the precious metals market will be extremely volatile in both directions at times, but buy the dips as gold and silver will keep heading to higher and higher ground.

As long as the Fed and U.S. government follow the course of “Quantitative Easing” or anything like it, you can rest assured that gold and silver prices will soar!
If you leave your money in U.S. banks in dollars, you will lose most of the purchasing power of your money.

Use the downside volatility to buy any dips you see in the metals. Whether you bought gold at $600, $1,000, or $1,500 an ounce, it really won’t matter much when gold is trading at $6,500 an ounce or more.

The same thing can be said for silver. Don’t worry so much whether you bought at $25 or $50; silver will be priced in the hundreds of dollars an ounce, possibly $600 or more as the silver to gold ratio descends to 15 to 1, and possibly even 10 to 1.
In fact I believe silver stocks will actually be one of the biggest winners over the next 24 months.

Time is of the essence.

The lies of the Fed and the U.S. gov't are becoming bigger and more complex, their noses growing longer and longer as the fiat currency-economic-insanity comes to a head.

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator

Source

INFLATION, STAGFLATION, DEFLATION: GOLD AND SILVER STILL GREAT INVESTMENTS

Why gold (and to a perhaps lesser extent silver) is the asset of choice to hold in uncertain economic times when any one - or all - of inflation, stagflation or deflation may become prevalent

Author: Julian Phillips (Reuters)

BENONI -

In this article we look at some critical fundamental features of precious metals that are rarely considered or accepted in the developed world markets. Expert investors like Warren Buffet look at inactive, buried gold with amazement, because he is focused on companies that produce things and earn money. And most of us wish we had his skill and money behind us.

George Soros and the like invested in gold as an anti-deflationary measure. Most analysts appreciate the anti-inflationary value of gold and silver. The protection of gold and silver in stagflationary environments are a combination of both abilities.

But why are gold and silver capable of giving such protection in bad times as well as good times?

They have certain qualities that shine forward at times when other investments fail.

THE LIMITATIONS OF CASH

In times of monetary stability and soundness, safely-stored cash never fails. Most consider cash in the bank to be the safest conservative investment, and in the distant past, the days of our grandfathers, this was largely true.

But that horrible word, inflation, came into being where prices kept on rising and cash saved would buy less-and-less. Interest rates compensated for this inflation, but then interest rates stopped rising. When interest rates did rise, it was at a slower pace than inflation. Cash lost its buying power as time went by. Bank charges would eat away any gains that might be made. At first inflation would occur one country at a time, and the exchange rate on those currencies fell, hurting international buying power even more. Today inflation is a global phenomenon.

Investors would have to move out of cash and into businesses or other investments that offset the cost of inflation. This was not easy unless inflation happened while growth was vibrant. And this benefitted those middle classes that enjoyed such growth. The poor, whose income rises slower than inflation, feel the pinch.

Suddenly, booms turn into busts and businesses don't do well. The value of businesses and its shares fall, losing investors money. Even self-managed businesses fall in value, putting rich people into bankruptcy. This is deflation, a monetary mood that causes values to shrink. In deflation the value of cash grows as prices fall.

Those who believe they are skilled investors answer, sell, then cheaply buy back. We look at that timeless story of an investor who did that just before the Wall Street Crash. His friend did not do so well selling only when the fall was half way down. But our hero who sold at the top, overwhelmed by his own skill bought back in, when the fall was half way down. His friend did not buy back in, but stayed in cash. It's not so easy!

Then you get a situation when the bust happened and all of the markets plummet because forced selling drives investors out. Interest rates fall to negative levels. If cycles are consistent, there should have followed a boom period. But growth was so anemic that stagnation set in. Businesses and the economy struggle to find small amounts of growth and some cut back, turning over at survival level.

Suddenly, something that shouldn't happen in a downturn happened. It was inflation, driven by factors no government can control. It came from energy and food and became uncontrollable. This type of inflation is deflationary. Businesses covering expenses suddenly found their costs ate away at profits much the same as deflation and inflation would have done. This is ‘stagflation', a climate where stress levels steadily eat away at sanity.

Surely bills and bonds are a way out of the hole, as they pay an interest rate, while being almost like cash?

The trouble with this thinking is that interest rates have fallen so low that the bill and bond markets are so high as to be heading for a fall, far worse than any Wall Street Crash.

Next interest rates rise to stop negative interest rates from rising higher. Then the prices of fixed interest securities have to fall, while their yield rises. Investors rush to exit those markets the moment that happens.

Surely there is no escape from these three economic ailments?

Well, there is....

For a long time, our Asian friends have suffered through poverty, hard times, government corruption and mismanagement. They have found refuge in good times and bad times. They want financial security and their investments to last for more than one generation. Correctly invested, their savings provide financial security for many generations.

You would have thought that Europe in particular would have learned the same lessons with their history of currency collapses and wars.

WHY PRECIOUS METALS?

Gold (and to a lesser extent, silver) is more than a barbarous relic from yesteryear. Its rising price is telling us that it is a very modern investment preference because

· It is both cash and an asset.

· In the long term, it outperforms cash because of these qualities...

· It has all the features that makes cash valuable, even capable of earning an income(when lent out).

· It is an enhanced version of cash, in that it is not subject to the vagaries of interest rates solely dictated by central banks and banks.

· It carries no national obligations. It does not rely on nations to supply collateral to honor payment. If you ask the Fed to honor the value of your dollar, they will simply exchange it for another.

· It is not dependent on the creditworthiness of the nation issuing money.

· It has the same value in Mongolia as it has in the U.S. or Europe.

· It is collateral in any transaction and of greater value than the price it can be exchanged at.

· It cannot be issued at will, with the intention of being withdrawn from the system later.

· It does not decline when an individual currency declines (and does not rise when that currency rises in value). It is a ‘counter to currencies'.

· This century it has moved away from the control of the U.S. and Europe to global control. In the years to come, rising Asian demand will dwarf demand from the developed world, making it a fully internationally-valued asset again.

· In a deflating global economy (just as cash is a national protection) gold is better than cash even when local currencies are not deflating.

· In an inflating global economy, gold acts as an asset, when currencies are cheapening. There are no other currencies that are deemed as assets, like gold.

· In a stagflationary economic environment, gold acts both as cash and an asset.

Julian Phillips is a long time specialist analyst of the gold and silver markets and is the principal contributor to the Gold Forecaster - www.goldforecaster.com - and Silver Forecaster- www.silverforecaster.com - websites and newsletters

Original source

SPROTT SAYS SILVER WILL KEEP OUTSHINING GOLD

By Euan Rocha and Pav Jordan

TORONTO | Tue Mar 8, 2011 3:53pm EST

TORONTO (Reuters) - Silver is likely to keep outperforming gold thanks to strong dollar flows, though both are still good investments compared with copper and other base metals, according to Eric Sprott, the hedge-fund manager and Canadian investment guru.

"I watch where the money goes and the money's going into silver. There's as much money going into silver as into gold in dollar terms," said Sprott in an interview with Reuters.

Sprott, who heads Toronto-based hedge-fund Sprott Asset Management, said it is important to note that silver available to buy is relatively scarce in terms of value, and that bodes well for further gains.

"There is 75 times more dollars worth of gold to buy than silver, but the money's going in one to one," says Sprott, while speaking on the sidelines of an investor event held in conjunction with the annual PDAC mining convention in Toronto.

Silver stocks in COMEX warehouses are near their lowest since April 2006, when the metal traded at $5 an ounce. Demand for silver coins has also picked up, especially in the United States, where it was at record levels early this year.

"My biggest thing is silver -- I think silver is going to go up a lot here. Gold's right in there, but not as good as silver," said Sprott, following a presentation to hundreds of investors in a resplendent ballroom at Toronto's Royal York Hotel.

Gold and silver -- traditionally viewed as a safe store of value in turbulent times -- have soared on inflation concerns, political turmoil in the Middle East and North Africa, an uneven U.S. economic recovery and the European sovereign debt crisis.

Gold touched an all-time high of $1,444.40 on Monday, while silver hit a 31-year high of $36.70 an ounce, after rating agency Moody's downgraded Greece's debt and violence flared anew in Libya.

"I have a little website that sells gold and silver maple leafs, and we sell about four times more silver than gold in dollars (terms)," said Sprott, who had earlier in the day addressed a room full of miners and investors and others at the PDAC convention.

The PDAC event is the world's largest gathering of people tied to the mining industry, and this year's event is expected to attract more than 22,000. The mood among delegates is exuberant, thanks to record or near-record prices that both precious and base metals are commanding.


BASE METALS RISKY

While bullish on precious metals, Sprott is wary of base metals - copper, nickel and zinc - as their fortunes are too closely tied to the fate of the broader economy.

"I agree with the prices of precious metals. I'm not as much of a bull on base metals," said Sprott. "I still worry about the financial system, it's massively over-levered and will still come undone."

Sprott's views on base metals mirror those of another of Canada's most influential money managers, Donald Coxe, who expresses similar doubts about the strength of the economy due to surging food and fuel prices.

"I'm not as economically optimistic as the average guy, so I don't go to base metals," said Sprott, a gold bug, who has built a reputation for bucking market trends.

"We have oil and food prices rising like crazy ... It's almost hyper-inflationary," said Sprott, who advises investors to put money in "real things" where demand is virtually inelastic.

"I'm very optimistic about gold and silver," said Sprott. "And real things like potash, uranium, oil, stuff that is absolutely essential."

(Editing by Frank McGurty)
The article is found in this link

CITIZANS BANKED ON GOLD IN MYANMAR'S TROUBLED ECONOMY ~ ROB BRYAN (AFP)

The article is somehow a little bit blur. My apologies for my inexperience in handling the blog. You can click on each page to read the enlarged version. To go back, press <-- button. The content of the article is eye-opening for all of us. Read the 4 pages article and you will know why people keep gold instead of piles of money.

Full article can be sighted at http://bit.ly/fk5MUH. No changes has been made to the article with the exceptions of the highlighted wordings.

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