Egyptian crisis brings a swift end to the gold and silver correction
Posted on 29 January 2011 with 2 comments from readers
Gold and silver prices bounced back suddenly as the news from Egypt grew worse with riots on the street morphing into mass rallies for reform, and the dismissal of the government by the president who still clings to power himself.
The fears of contagion that followed the Jasmine Revolution in Tunisia have proven correct. There is also unrest in Yemen and Lebanon where the Iranian backed Hezbollah is now in control. With the Middle East in turmoil it is hardly surprising to see the price of oil, silver and gold heading back up from a recent correction: $1,310 an ounce looks as low as gold will go and $26.50 for silver.
Correction over
Indeed, that is probably it for the correction in gold and silver. This week business leaders in Davos spoke of their dreams fo a full-on recovery in the global economy and for a moment some investors believed them and sold their precious metals and bought stocks.
Back to reality this week and the global economy is far from mended, even the much trumpeted US recovery is largely a sham created by mounting inflation while housing and auto sales remain deeply depressed. Elsewhere, from the UK to Japan the dark clouds of recession are gathering. Higher oil prices from an unstable Middle East will not help anybody with their recovery.
Safe haven
To seek a safe haven in a world of inflation and depreciating paper money is only logical, and that is why the value of gold and silver has been rising for 10 years and will continue to rise until this whole financial folly is over.
Watch out for a crisis in bond markets and a rush to liquidate equities to square positions, higher interest rates and lower property prices. Eventually gold, silver and black gold will be the only things to own. A perfect storm is almost upon us. The endgame has begun.
2 Comments posted by readers:
Certainly, the “End-Game” is near, and it’s possible that it has already begun, especially if civil unrest spreads to other Arab countries, as I suspect they may. With Syria also closing down their internet, they, together with Yemen, may go viral this weekend.
Mubarak, The Coward:
By shutting down the internet, Mubarak made the situation far worse, and proved to the Egyptian people that he suppresses freedom. Then he throws his cabinet to the wolves while trying to cling to power — what a low-life coward. My prayers are with the Egyptian people.
Governments get turned over every once in awhile. It’s NOT the end of the world.
Hello, Hello, Is this thing on? Anyone out there with a brain and logical thought listening?