The financial news media, seeing gold rally to its highest level in months, explains the surge as safe-haven demand in a slowing global economic recovery.
As my British friends say, "Bolllocks."
I’m always amazed how uninformed financial reporters can be about the markets they cover. Many even seem to miss the news in their own publications!
The reason gold moved above the key $1,300 resistance level is the quickly fading U.S. dollar rally. Emerging-market fears drove the greenback higher for a few weeks, and now that fear is subsiding.
Because gold and silver, like oil, trade in U.S. dollars worldwide, a weaker dollar means higher precious metals prices.
A stronger dollar usually means lower precious metals prices. Exceptions are possible, but the market always returns to that dynamic.
Here are three more developments set to accelerate gold’s rise to $5,000 … and two of them provide plenty of reasons to be excited about the trip!
A Reason for Optimism …
They say America is past its prime … that we’re on a path to default and we can’t compete in the global markets. But I think they are wrong!
Right now, I see 3 mega-trends converging that could send the Dow soaring to 30,000 or higher.
And at noon Eastern on Thursday, Feb. 27, 2014, I’ll show you how these powerful trends could generate gains of 10,000% or more in the next few years!
If you’re serious about banking major profits this year … and for years to come … this is an event you just can’t miss. Reserve your seat with just one click.
3 Developments Set to Send Gold to $5K+
First, a rising Middle East regional threat supports higher precious metals prices.
President Obama recently conceded the current U.S. Syria policy is NOT working. He admits that Syria’s President Assad is not negotiating with armed dissident groups.
Meanwhile, al-Qaeda affiliates are growing in power throughout the region. Reports that Turkey is providing aid to elements of al-Qaeda are especially disturbing.
Rumors the Obama administration is again considering military options are making their way into news.
However, and this bring us to our second road to $5K gold …
Gold and silver don’t need panic to move higher. They can rise on wealth-driven demand, too.
Gold, silver and platinum prices can rise dramatically even without monetary, economic, terroristic and war-driven fears.
Precious metals prices will rise on their own. But there’s something coming that can help them simply catapult them higher.
This brings us to our third reason why gold is set to soar to unprecedented levels … and to take silver, platinum and other precious metals like palladium along with it.
That’s because I believe we are on the verge of the greatest period of economic growth in human history, driven by scientific and technological breakthroughs.
As the world’s wealth increases, so will its demand for precious metals. Investors will diversify their portfolios while jewelry and industrial consumption both move up.
As you can see in the charts, global GDP is growing steadily on both a total and per-capita basis.
I believe these estimates are conservative because they don’t take into account the accelerating returns from breakthroughs in science and technology.
Given the very limited supply, my prediction of $5,000 gold is very reasonable given the tens of trillions of dollars in new wealth.
Remember, Wealth Can Multiply.
Meanwhile, We’ll Have Fewer
Gold Supplies to Divide.
Look, I know plenty of doomsayers are predicting economic collapse and disaster. Whether you expect crisis or growth, owning a core physical position and systematically adding to it makes solid sense to me.
Housing: Yet Another
Reason to be a Bullion Bull
Right now deflation is a greater risk than inflation, but that will change. A recent survey on U.S. housing prices by Zillow shows even pessimists think they will climb 35.8% in the next four years.
Optimists expect housing prices will lurch 84.6% higher by 2018. That’s an early warning that inflation will re-emerge.
This month gold broke above resistance in the $1,280 area. The next resistance is probably $1,360. Notice the strong, consistent buying volume (bottom pane).
Silver also broke out with strong volume. This parabolic move will be hard to sustain, so I expect a pullback. If prices can stay above the previous $20.50 resistance, that level should become the new support area.
Platinum may be forming a medium-term bullish "head and shoulders" bottom.
I’ll be talking more about gold, silver and platinum in my special "America’s Comeback" online event this Thursday, Feb. 27. Attendance is limited so click here to reserve your seat now.
I believe our nation — and our world — is entering a period of profound change that will create both risk and opportunity. I want to help you prepare for it, so be sure to tune in this Thursday. The event will begin promptly at 12 noon, Eastern time.
Watching Your Chickens,