Tax & Financial Consulting Services
Is This Gold Rally Sustainable?
You Bet It Is!
Dear G&G Readers,
Recently, I've received quite a few emails from subscribers asking me if the latest round of large gains in gold and gold shares is sustainable. My answer: Absolutely! Here's why.
Reason # 1. The gold market is tiny. It's estimated that the current value of all above-ground gold is worth a mere $1.4 trillion at gold's current price. That's one-16th the size of the global bond markets ... one-20th the current value of global stock markets ... and less than the value of one day's worth of trading in the foreign exchange markets.
Now, with both stocks and bonds looking toppy, I expect more individuals and institutions to seek out investments that have been moving higher, regardless of deflation or inflation, and regardless of bear or bull markets. Gold and related investments will be among their top choices.
Reason #2. The market cap of gold shares — at $69 billion — is a mere pittance. If just a fraction of a percent of the money in the world's stock markets moves into gold shares, you're looking at potential doubles and triples in many.
Reason #3. The price of gold is rising in terms of all major currencies. When the price of an asset rises in dollar terms ... AND in Swiss francs, British pounds, Japanese yen, and euros — all at the same time — you have what I call an "unadulterated bull market."
Reason #4. Demand is rising rapidly. Do not underestimate the intense and growing demand for gold — especially coming from China. Xi Jianhua, the Bank of China's gold business expert, recently stated that local consumers could pour $36 billion into the metal. That's the equivalent of about 2,950 metric tons, or more than one year's worth of mining production. Moreover, a recent survey in China showed that up to 20% of the respondents are willing to divert up to 30% of their savings into gold.
Does all this mean that gold and gold shares will move straight up? Of course not. But the long-term trend is clear.
For those of you who have already started purchasing Gold & Silver from my recommendations over the past year, use this as a reminder to purchase your Gold & Silver for the month.
For those of you who are still pondering whether I should or shoudln't invest in Gold & Silver or keep throwing a good portion of your savings down the drain right now into paper assets.
For more details on how to start purchasing physical Gold & Silver coins at 25-35% off the US Mints published price right away, click the link below or goto G&G Associates website and click on the "Precious Metals" tab to start purchasing "REAL" money now instead of paper promises backed by nothing. You can purchase as little as 1 coin at a time to as much as you can afford. Start today...stop waiting.
Tax & Financial Consultant, RFC
866-361-3872 toll free fax
"A Prudent man foresees the difficulties ahead and prepares for them; the simpleton goes on blindly and suffers the consequences."
Proverbs 22:3 -- Living Proverbs
LEGAL NOTICE: This work is based on SEC filings, current events, interviews, corporate press releases and what I've learned as a financial consultant. It may contain errors and you shouldn't make any investment decision based solely on what you read here. It's your money and your responsibility. G&G Associates gets paid a commission from a membership purchase at www.publicgold.com/gngpreciousmetals.