Gold: The Message and the Meaning

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Gold is moving into the beginning of what I call a potential buying stampede. Those who have traded out of gold (and there are a lot of them) are now being left behind. In a buying stampede, overbought conditions are traditionally ignored. The idea at this point is to get into the item (gold), and those who wait are left behind...It may be a bit early, but I suspect that if gold closes above 1000 we will be close to another buying stampede.

...I said it three years ago, I said it two years ago, I said it a year ago, I said it six months ago, and I'll say it again today. The Achilles' Heel of the United States is the dollar. The reserve status of the US dollar is absolutely critical to the health of the US. If the dollar begins to lose its reserve status, the US economy will be in shambles.

Gold is now on the move. It's taking more and more dollars to buy an ounce of real money -- gold. This is the market's way of saying that it trusts the value of the dollar less and less. You may like gold as I do, but the rising trend of gold is a red flag for the health of the United States. The rising dollar price of gold is telling us that both the US economy and the dollar are in trouble.

The US is the only nation in the world that can print the currency that its own debt is denominated in. That's an unbelievable "gift." But the US has been doing too damn much printing and too much debt creating. The world recognizes this, and it's systematically moving away from dollars. Nations are now creating Sovereign Wealth Funds that buy tangibles while at the same time they're getting rid of unwanted dollars.

Right now almost everything from stocks to the Dow to homes to food is losing value relative to gold. I tell you it's ominous. And it's all the more ominous because 95% of analysts and economists don't recognize or understand what's going on. They're ignorant of the message that rising gold is sending us, and worse -- they're ignorant of the very meaning of gold."...Gold is moving into the beginning of what I call a potential buying stampede. Those who have traded out of gold (and there are a lot of them) are now being left behind. In a buying stampede, overbought conditions are traditionally ignored. The idea at this point is to get into the item (gold), and those who wait are left behind. We last experienced a buying stampede in gold during 1979-1980. It may be a bit early, but I suspect that if gold closes above 1000 we will be close to another buying stampede.

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