Sunday, April 14, 2013

As the Gold Smash Continues, This is all You Need to Know

As I write this Sunday night, PST, the Asian market has opened and gold is at $1,441 continuing its decline from Friday. As I mentioned in the previous post, this was to be expected. Margin calls are going out all over the world, and people and banks will be selling to raise cash and playing into the hands of the Western central banks who do not want you to own gold.

Of course the Chinese are probably laughing their asses off as they wait just a little longer to hit the BUY button.

All you, my readers, truly need to know is the graph above. Gold is highly correlated to both the US debt and the global supply of currency. With most all Western central banks printing like crazy (Almost $1 Trillion this year in the US alone) there can be no doubt which direction gold should go.

When the market price deviates from its instrinsic value by this much, you've got to take notice. There's an old trader saying that you buy when there is blood in the streets.

And by the way, stocks may go a similar direction very soon.

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