Metals & Oil prices dropping fast, but jobs are too…

March 20, 2008 in Gold and Silver, Money Thoughts | No comments

OUCH! The value of my precious gold and silver is down 10%! What should I DO?!?! You might be thinking it’s time for me to get out now. Go ahead, laugh away, make your jokes… Just know that I still stand firm in my beliefs that Gold will continue to get back in line with the trend channel. Take a look at this chart (I drew the trending channel):

Gold Chart Technicals - March 20th, 2008

Here is the the big news today supporting my claim that our economy is not getting better. Job loss claims jumped by 22,000, here is the opening statement from the yahoo financial article.

“WASHINGTON (AP) — The number of newly laid off workers filing for unemployment benefits rose last week to the highest level in nearly two months, providing more evidence that the weak economy is having an adverse impact on the labor market.”

Oil prices are sliding due to the fact that consumption will go down, so prices will slide. Hopefully that will hold true, even though that will affect the price of my gold and silver dramatically. I personally do not believe we will see gas prices drop too much and a friend of mine sent me a link that said Maui now hit $4 a gallon.

Know this:

  1. Inflation will be a BIG concern soon.
  2. The FED cannot drop rates much further to stimulate the economy any more.
  3. Gold is now being bought in BIG quantities by gold dealers and jewelry makers. Do you think they would buy now if they thought the price still has a long drop ahead of them?
  4. There are countries where smaller cities have stopped taking the US dollar for currency exchange because they are losing too much money in it’s value dropping.
  5. There is good news for some who have business overseas. Here is an article that came out today regarding Nike’s results:

“In earnings news, Nike Inc. reported late Wednesday a 30 percent gain in quarterly profit, signaling to Wall Street that some companies are faring well despite the credit crisis. Nike said sales overseas increased largely because of the weak dollar.”

Notice the last sentence of the paragraph?

Don’t worry if you bought gold and silver at the height of the last run, it will STILL be a blessing to you.