Gold Price About to Stage a Huge Rally
Source: GoldSeek, Peter Cooper (4/21/09)
"This is an important trend reversal. . ."
This is an important trend reversal and marks a shift by investors to safe haven assets in advance of another plunge in equity values.
The U.S. dollar also strengthened across the board and bond prices rose. It is unusual to see both gold and the dollar rising together but again this normally signals an important trend reversal.
The fundamental case for investment in precious metals has also become overpowering. Global bank bailout and stimulus packages have resulted in a huge increase in global money supply that has never had any effect except inflation in all history.
The gold supply by contrast is relatively fixed and production is actually falling. Supply is even tighter for silver – where stock levels are a hundredth of gold - and that is reason enough to expect the established pattern of silver outperforming gold will be repeated again.
In all investment markets it is the trend that is really your friend. The next dilemma will be how to best leverage the upside to the gold price.
This will start with a debate about silver as a better alternative. But then gold and silver stocks will come under the microscope, and the value of the bombed-out junior stocks brought into focus.
It can be little consolation that great days lie ahead for gold for this signals the failure of the conventional investment universe, and that means further horrors ahead for currencies, stocks, bonds and real estate.