Gold Watch by Capital Gold Group

Gold prices pulled back this past week after shares in Asia were hit hard by JPMorgan’s massive $2 billion loss, political turmoil in the eurozone, and weak economic data from China. The JP Morgan loss may be higher than the reported $2 billion and could spur investors to sharper sell offs in markets which could lead to a further pullback in gold prices.

Despite the likelihood of a dip in prices, the JP Morgan loss is a positive for gold as it shows how little has been reformed on what continues to resemble a casino for investors, Wall Street and the global financial system. The JP Morgan loss also shows that systemic risk still remains.

Even today, Morgan Stanley analysts stated that gold’s bull market “is not over” and that they are buyers of the metal at current prices, arguing that recent low prices are “consistent with distressed selling and long liquidation,” and that prices will recover in the coming weeks.

In addition to Morgan Stanley, highly respected economist and strategist David Rosenberg recently told the Financial Times in a video interview that gold “will go to $3,000 per ounce before this cycle is over.”

Be proactive not reactive when it comes to the protection of your long-term savings and retirement accounts. Take advantage of the golden buying opportunity by contacting Capital Gold Group today and take control of your financial future with physical gold!

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In an interview last week with the Wall Street Journal, respected commodities trader Jim Rogers of Rogers Holdings stated that riots such as the ones witnessed in Greece and reported as widespread in China will hit the United States and again in Europe as the financial crisis continues to takes shape.

“I’m more worried about those kind of problems [rioting] in the U.S. and Europe; this is where social unrest is going to be worse,” Rogers said. “I would suspect that, when economic conditions get worse here and get worse in Europe, we’re going to see . . . you’ve seen governments fail in Europe; you’ve seen countries fail in Europe. I suspect you’re going to see more of it [rioting], yes.”

With the possibility of QE3 still a reality and claims that the Fed will be able to contain inflation according to Ben Bernanke’s speech at the FOMC meeting last week, Rogers made clear his dissatisfaction with the Fed chairman.

“Mr. Bernanke has zero credibility as far as I’m concerned. The Federal Reserve has zero credibility,” Rogers said forcefully. “Go back [and look] at everything Mr. Bernanke has said in the last seven or eight years he’s been in Washington. He’s never been right about anything. The man has zero credibility for anyone who would take the time to look at his history.”

In regards to inflation, Rogers stated it is already in the pipeline, and will manifest in higher commodities and consumer prices—of which, historically, have lagged money supply expansion by six months to one year.

“[The Fed has] been printing staggering amounts of money; they’ve been taking staggering amounts of debt onto their balance sheet, much of it is garbage,” said Rogers. “The federal government is spending huge amounts of money, we have inflation in the U.S., and it’s going to get worse.”

So how should you plan to protect yourselves against the inevitable rise in inflation and devaluation of your hard-earned dollars?

Investors seeking protection against devaluing currencies here and abroad will increase the demand for gold, and the price will continue to soar, despite recent consolidations. Top economists are already predicting that gold could exceed $5000/oz over the next four years!

“Gold has been up 11 years in a row which is extremely unusual for any asset. It’s consolidating; it wouldn’t surprise me if it continued to consolidate. If it goes down a lot more, I hope I buy a lot more. I’m not selling my gold by any stretch of the imagination.” said Rogers.

Buy physical gold today to protect your long-term savings and retirement accounts!

As Spain announced its slide into a new recession, economist Harry Dent told CNBC today that the Spanish recession could force the U.S. stock market to fall anywhere between 10 percent and 20 percent.

Dent’s statement came as a response to Standard & Poor’s downgrade of 16 Spanish banks and the announcement that the first-quarter gross domestic product figures that reflected the country to be in recession.

“Spain’s problems are far worse than what happened in Greece,” said Dent. He went on to say “Spain has higher unemployment than Greece, higher total public and private debt than Greece,” as well as a bigger housing bubble, a higher percentage of subprime mortgages, and the country has “one of the highest percentages of debt owed to foreigners.”

In short, Spain is “too big to fail, too big to bail.”

So what does the likelihood of a default in Spain mean for your hard-earned dollars?

The Eurozone is poisoning itself as economies continue to struggle under enormous amounts of debt. The fact that Spain is just one more country failing economically is not a good sign for not only the Eurozone, but for the rest of the world.

Be proactive not reactive when it comes to the protection of your long-term savings and retirement accounts by contacting Capital Gold Group today and taking control of your financial future with physical gold!

The Federal Open Market Committee (FOMC) begins a two-day meeting today at which hints of fresh round of quantitative easing are likely to be discussed.

But will there be a third round of quantitative easing or no?

As best put by the Wall Street Journal, “that is the question constantly on investors’ minds these days as they grapple with markets whipsawed by the every new bit of jawboning among Fed officials.”

While it cannot be said for sure whether the Fed will have yet another round of money printing, support for action from the FED can be supported by the fact that economic data lately hasn’t demonstrated a strong bounce back of the U.S. economy. Jobless claims continue to rise, manufacturing reports are exhibiting slowing growth, and the housing market’s recovery has hit a snag. Due in part to this lack of positive economic data and news of more central banks stockpiling gold, the yellow metal has continued to rise as investors hedge against FED action that may affect the value of their hard-earned dollars.

Data from the International Monetary Fund (IMF) shows that central banks have continued to make significant gold purchases, with Mexico raising its holdings by 16.8 tons, Russia lifting its reserves by 16.55 tons in the past month, and Argentina increasing its gold holdings by 7 ton in September of 2011.

“The story for gold is unchanged, whether you’re looking at the fundamentals, which have underpinned then market from the year 2000, or the premium on gold attached to the economic crisis,” Sharps Pixley Chief Executive Ross Norman said.

Those fundamentals being concern over the stability of paper currencies such as the euro and dollar, as well as low interest rates held by the FED.

“The dollar is coming out of the mire first, and that has weighed on gold and on speculators’ patience,” he added. “But on a longer-term view, nothing has changed.”

Be proactive in the protection of your long-term finances and hedge against the further devaluation of the dollar with physical gold.

Things are unraveling in Europe at a startling pace.

As discussed last week, in order to avoid default, Greece, Ireland, and Portugal have all needed bailouts from the European Union and the International Monetary Fund to keep from drowning in their massive amounts of debt. Unfortunately, Spain is in great danger of becoming the fourth Eurozone country looking desperately for a bailout.

According to Bloomberg, Spain’s 709 billion euros of sovereign debt is roughly twice the debt of Greece, Ireland, and Portugal COMBINED! This is a major issue as many European banks have huge exposure to Spain’s debt and a Spanish crisis would spread quickly, putting a heavier burden on the rest of the already struggling Eurozone.

As highlighted by Paul Krugman of the New York Times, “Spain is in full-on depression, with the overall unemployment rate at 23.6 percent, comparable to America at the depths of the Great Depression, and the youth unemployment rate over 50 percent.” This can’t go on — and that realization is what is sending Spanish borrowing costs ever higher.

In response to the worsening crisis in Spain, the European Union is insisting on more “austerity”– cuts in Spain’s government spending.
In theory, these cuts in spending would reduce deficits and improve confidence, but in reality, the opposite is the case.

“Austerity” measures have made the situation in several countries, including Greece, much worse, because they have led to higher unemployment (as government workers are fired from their jobs), reduced services (leading to social unrest), and more economic weakness (as overall spending shrinks and budgets are tightened).

So what does this mean for you and your finances? The Eurozone is poisoning itself as economies continue to struggle under enormous amounts of debt. The fact that Spain is being asked to make things worse by implementing a strategy that as shown by Greece, fails, is not a good sign for not only the Eurozone, but the rest of the world.

As mentioned last week by Louise Cooper, a top financial analyst in London, “If the Eurozone has a really bad time of it this year, which it could well do, then America will not escape unscathed.”

Be proactive not reactive when it comes to the protection of your long-term savings and retirement accounts by contacting Capital Gold Group today and taking control of your financial future with physical gold!

Ten European countries are in a recession. In order to avoid default, three have needed bailouts from the European Union and the International Monetary Fund, and more might be necessary. What’s at stake? A lot, including the future of the currency, the euro, and the health of the United States’ largest trading partner.

Yesterday on CBS’ 60 Minutes, Steve Kroft reported on the European Debt Crisis and how it could derail the U.S. economic recovery that seems to be slowly progressing.

Just like the financial crisis that leveled the U.S. economy in 2008, a recession is sweeping across the European continent but this time it’s not just the banks that are in danger of going broke, it’s entire countries.

“We’re in a debt crisis. Eurozone countries have way too much debt. We have gorged on debt. We are living beyond our means. And after 10 years of booming economic times, it is now payback time. We are paying back our credit cards and that will prove very painful and costly,” said Louise Cooper, a top financial analyst in London.

Cooper continued, “Nobody quite knows what a messy Greek default will do. And what a country coming out of the Eurozone will do. And if it’s uncharted waters, then that makes a lot of people very nervous. If the Eurozone has a really bad time of it this year, which it could well do, then America will not escape unscathed.”

Watch the full report from 60 Minutes below…

The crisis in the Eurozone is not getting better and now is the time to be proactive rather than reactive in the protection of your long term funds against worldwide debt crises! Protect yourself with physical precious metals before it’s too late…

Last Thursday, U.S. rating agency Moody’s warned that it may cut the credit ratings of 17 global and 114 European financial institutions in another indication that the impact of the euro zone government debt crisis is spreading across the global financial system.

Moody’s cited that with more fragile funding conditions, increased regulatory burdens and a tougher economic environment for its review, the action warned to be taken on the financial institutions from 16 European nations reflects the impact of the debt crisis and spread of deteriorating creditworthiness.

“Capital markets firms are confronting evolving challenges, such as more fragile funding conditions, wider credit spreads, increased regulatory burdens and more difficult operating conditions,” Moody’s said in a statement.

This ominous warning from Moody’s follows earlier rounds of downgrades in European credit ratings as euro zone countries struggle to keep the weak link of Greece afloat as borrowing costs and finances continue to be strained.

In an effort to protect against a further debt domino effect, European Union leaders have been trying to put a financial “firewall” around the most afflicted euro zone nations, but in February, several EU sources told Reuters that the euro zone was considering a delay in parts of a second bailout plan for Greece.

So what does this mean to you and your finances? European banks’ bond holdings of struggling euro zone nations like Greece, Portugal, Ireland, Spain and Italy have trapped Europe in a vicious circle that will inevitably lead to a collapse of the euro all together.

A shock to the U.S. economy like a collapse of the euro would be devastating because if the Eurozone economy collapses, the US government is likely to face a situation of soaring unemployment, a failing economy, and a bankrupt financial system.

Be proactive rather than reactive when it comes to the protection of your long-term funds and diversify your portfolio with physical gold today!

The U.S. economy needs to grow more quickly to bring the unemployment rate down further.

This is what Federal Reserve Chairman Ben Bernanke told the National Association for Business Economics (NABE) today as he defended the central bank’s policy of very low interest rates and gave what some experts gathered was a precursor to yet another round of quantitative easing.

While Bernanke offered no specific indication the Fed was going to embark on another round of money printing, Bernanke did make it clear the central bank is in no rush to reverse course after responding aggressively to a deep recession.

“Further significant improvements in the unemployment rate will likely require a more rapid expansion of production and demand from consumers and businesses, a process that can be supported by continued accommodative policies,” said Bernanke.

“Reading between the lines, it sounds like he’s pushing the ball forward toward having a discussion about doing more,” said Chris Rupkey, economist at Bank of Tokyo-Mitsubishi, on the sidelines of the NABE conference.

Rupkey was not the only expert with this opinion as Dennis Gartman, author of The Gartman Letter, sees further action by the Fed as a high probability and something that will send gold skyocketing.

“If you’d ask people last week you’d think QE3 was off the table and broken on the floor,” Gartman said.

Bernanke’s comments and the thought of QE3 helped send gold higher but even before Bernanke spoke, Gartman said “it was apparent to me the trend was still up” for gold.

In fact, gold has been on an upward trend for over 10 years, as shown in the chart below.

Another round of quantitative easing would mean increased inflation, the devaluation of the dollar, and likely, gold prices above those seen in August of 2011.

Regardless of what may or may not be announced by Bernanke and the Fed at future conferences, we like to keep with the motto here at GoldWatch that you don’t wait to buy gold, you buy gold and wait. Be prepared readers and be proactive in the protection of your savings with physical gold!

Despite the Fed’s official reports earlier last week that the economy is on the mend, Co-Chief Investment Officer of PIMCO, Bill Gross, has voiced that he has a more dismal outlook and when Gross speaks, the market tends to listen.

“I believe there will be a QE3, and perhaps a QE4,” said Gross. Why? In the past few years, whenever central banks have stopped or paused their quantitative easing efforts, “stock prices have fallen and economies have slowed.”

It just so happens that the Federal Reserve’s “Operation Twist,” the plan where the Fed sold short-term debt and purchased long-term bonds in an effort to keep longer-term interest rates lower, is scheduled to end in a few months.

Why is this an issue? The globe’s private economies simply aren’t sufficiently strong enough to support robust growth, and the world’s central banks aren’t willing to stand by and watch them fail. This is where policies like Operation Twist, Quantitative Easing, and government bailouts come into play. Unfortunately, it is the value of fiat currencies such as the dollar and the euro that suffer as a result.

In the past year alone, the Federal Reserve has injected close to $1 trillion into the U.S. economy with no significant turnaround to the economy as omens from abroad aren’t particularly good.

“Inflation is rearing its head” said Gross. “We’re seeing [inflation] in oil prices and other commodities, and we’re seeing it in the numbers,” he said. “The consumer price index has risen 2.9% in the past 12 months.”

So how can you be proactive in the protection of your savings and long-term funds against the threat of further inflation and money printing? Take advantage of the gold buying opportunity today!

As college tuition rises and the dollar continues to shrink in buying power, parents and grandparents are seeking alternative investments such as physical gold to protect and grow the long term funds set aside for the college education of their children and grandchildren.

The last decade could more accurately be called “the lost decade” when it comes to traditional investments. Gold outperformed the DOW, the NASDAQ, and the S&P 500, as well as U.S. Treasuries and high-grade bonds. A $1,000 investment in gold ten years ago would be worth over $4,000 today, while $1,000 invested in the stock market at the beginning of the decade would have had approximately the same value at the end.

With the buying power of dollars set aside for college shrinking and investment yields falling, a shortfall is likely to occur when it comes time to pay tuition…

However, college funds converted into physical gold can help keep pace with inflation and the rising cost of tuition. Parents with the foresight to move their children’s college funds into gold a mere five years ago have seen the value of their holdings double in stark contrast to other traditional investments.

But is a college education still worth the cost? The Bureau of Labor Statistics recently released a study for the 2004-2014 job outlooks for college graduates, which stated that “college graduates earn more money, experience less unemployment and have more career options then other levels of education.” A study from 2010 by the College Board also stated that after 11 years of work, a college degree leads to higher earnings, and college grads are also more likely to vote, volunteer and exercise, and less likely to smoke or become obese. Therefore, it seems that the investment in a college education pays off over the course of a lifetime, even considering the expense.

“Students are finding it necessary to take out additional loans to pay for tuition and other college expenses and are graduating with huge student loans that will take decades to repay,” said Capital Gold Group CEO, Jonathan Rose. “With the legacy of debt and deficit spending our country is leaving for future generations, our young children today need every financial advantage we can give them. College can still be a reality and not just a dream.”