Don't Look Back

Bush, meanwhile, believes the country will weather the financial storm.

"I'm optimistic about our economy," he said.

Wasn't he the same guy that stood on the deck of an aircraft carrier and declared "mission accomplished" after invading Iraq? LOL, our economy is doomed Mr.Bush. Everybody knows it, nobody dare to admit it.

The Dollar got bullied at the playground today and all the kids turned their backs on it. The Dollar is on an island, and that island is sinking fast. Gold, the USS Truthsayer, idling offshore for those seeking refuge from the Dollar.

Investors are quickly discovering the truth about the future of the Dollar and the US Economy. Investment demand will be the number one driving force behind the coming rise in Gold and Silver. As investors begin to lose faith in their money and trust in their banks, they will flock to Gold to protect their wealth. The smart money is there already. Soon Mom and Pop will wake up to the virtues of Gold and then they'll tell two people, and then they'll two people, and then they'll tell two more people, and soon there will be a stampede into Gold.

And as this stampede begins to swell across the country dem poor Rat Bastids on the ever insignificant COMEX will be destroyed. Desperate for somebody to sell them Gold to cover their ballooning losses, many will be seen jumping from windows and in front of buses as they face the fact that nobody is interested in selling Gold any more.

The mother of all short squeezes has begun in both Gold AND Silver. As prices rise, buyers become more anxious to buy forcing the shorts to bid up prices even higher to cover their shorts. The rising prices bring in even MORE buyers, and the Precious Metals markets become a runaway train fueled by increasing investor demand. The shorts get creamed...absolutely destroyed. Hallelujah!

Gold has reached the 735 projected move out of it's consolidation rectangle with amazing swiftness. Buyers are coming in and buying any little dip now. The shorts are being forced to cover at ever higher prices which have begun to put a floor under these prices. We may never see $600 Gold again. If you recall, in September of 2005 Gold broke the longstanding resistance at 456...and has not looked back.

Today Gold took out the May 2006 highs and set a new 27 year high for Gold. I suspect there may be another $25-30 of upside in Gold before we get a much needed consolidation. In the Big Picture this consolidation will seem brief, but a four week consolidation here may seem like forever. Be patient, Gold needs to catch it's breath before we get the go for "trans lunar injection" and a trip to the Moon. Silver will be the beneficiary of any profit taking in Gold as it remains 15% undervalued still. The more expensive Gold gets, the cheaper Silver will look to those that think they're late to the Precious Metals Party that Capt. Bernanke has so graciously picked up the tab for.

Support in Gold rests now at 714 and 705. For Silver, 13.34 is quickly building into support. Below that is support at 13.16 and 12.97.

The Dollar has no support, just those that want to take a swing at it standing in an ever lengthening line.

Oil. Oil is on a mission that nobody wants to talk about. Of note today was the Saudi refusal to cut interest rates in the Kingdom is step with the Fed as they have always done in the past. If the Dollar loses support from Saudi Arabia, the depths that it may plunge to by year end should scare even the most ardent Gold Bulls.

And from an email I received today from Peter Schiff, President and Chief Global Strategist, Euro Pacific Capital. This is a must see video...an absolute must see.

Below is a link to a video interview with Jim Rodgers that took place about 3 days ago. It is one of the most insightful, logical, no nonsense investment discussions I have ever heard. Jim talks about the fragile state of the US economy, the dollar, gold, the risks to the US stock market, Bernanke, and why he has moved with his family to Singapore. Among other things, he urges investors to sell their dollars and buy foreign currency. If you would like to see Jim’s video CLICK HERE.