Should we buy GOLD?

In the long run, we believe gold is going to go a lot higher than the current high of $1900/oz. There are a lot more analysts believing gold will go higher which means they will suggest that their clients and firms to buy gold. Some analysts believe gold will even go up to $5000/oz (sounds like an extreme case at the moment but does not mean it cannot happen).

Overview of the World

The Eurozone crisis is worsening, government fail to manage the U.S. debt responsibly, and markets are fearful of worsening conditions.
The U.S and the E.U are finding themselves in a battle to save the euro as the yields on their government bonds are moving up to unacceptable and unsustainable levels. The countries that are in trouble include France, Greece, Spain, Portugal, Italy, and Ireland. The only country that we see hanging on at the moment is Germany.

The global wealth is transferring from the west to the east due to lower paid intelligent people who can get the same job done at a lower cost which is the nature of capitalism. This is why the unemployment rate is high for U.S and the Europeans. It seems to be unavoidable that if China continues to grow its wealth and power, the Yuan will become a global reserve currency.
We are currently seeing greater uncertainty and instability in the world economies which leads to a more fearful and volatile market. It is not just one situation that is causing all of this fear, it is the failure to cut spending sufficiently, fear of collapse in the euro, bailouts of the banks, unemployment situations, and may even eventually see another minor or major financial accident. It is the weak monetary system that is causing an ongoing burst of one symptom after another.

Should we buy Gold?

Gold is known for a hedge for inflation and a safe haven currency. Currently we are seeing the gold price retracing to $1680/oz. Traders are driving prices down, breaking supports, hitting stop losses, and knowing some positions are leveraged or exposed to margin calls. It seems like potential buyers are still sitting on the side line. This seems like manipulation of the gold market.
Some traders are betting gold will fall to $1500/oz (which is 21% retracement) before making its big run up. However, we do hear a lot of countries and even people you know are starting to buy physical gold and silver. Right now, we are waiting to see if it can sustain the ~$1700 level. Some analyst are suggesting for their clients to buy when it hits $1650/oz. Futhermore, in the long run, we believe gold will go a lot higher, so we may see more small caps and venture companies move a lot higher along with it.

You are reminded that you are responsible for your own due diligence. We share in neither your profit nor your losses.