Tony Lepage

A lot has changed since my last economics post. Today is July 29th and look what we have:

• A revaluation of the Chinese Renminbi Yuan (It’s actually pronounced “You-en”)
• A have a huge jump in Gold and silver (nearing the end of July, better yet, begining of August).
• Gold also jumped in every currency today, thats right, a currency everyone wants when the going gets rough.
• The timing of gold is like clockwork. It has fallen during the months of April -> July for the past 16 years. It has also regained it strength to recover from August -> December.

Here is an example; Gold is trading around it’s low of 418.00 for the year of 2005. Last year, it’s low was around 379.00 and it managaed to finish the year off over the price of 450.00.

No one seems to care about the fundemental factors behind the strength of Gold and Silver. That is fine, let your savings rot away (if you have any–ponder that).

When you care about what the fundementals behind silver are, be sure to turn on you television and check if you’re just trying to keep up. If the TV says its a good idea to buy, let me know, I’ll be more than happy to sell you some of my gold. Shit! I’ll promise to deliver within 2 hours (at market price of course )!

Take a look at the Weimar Republic and see how the story ends.

No sooner did I post that last article and I felt I needed to address something else.

I purchased gold a little over one year ago. It hasn’t yet translated into real large gains for me. Why is that? Gold is a currency and a damn fine one. But so is the Canadian Dollar. The Canadian dollar is the 4th best performing currency. It is right behind the Swiss Franc, which is right behind the Aussie Dollar. What is ahead of every single currency? Gold!

In fact, here’s how Gold is doing when related to a few other currencies:

• Japanese Yen is seeing gold at a 14 year high.
• Norweigan Corona is seeing gold at a 25 year high.
• British Pounds, its at a nine year high.

GROWING PROTECTIONIST SENTIMENT

Here are some links I recently found. They are all related to investments, specifically gold, silver and currencies. I promise that they are all worth a read, enjoy!

• Why do I think gold is a good investment? Gold is money and it is limited. It can’t be created on demand like other forms of money. Investors choose gold when fiat currencies are unstable.
• Gold consumption outpaces production and this year marked the sharpest decline in goldmine output since 1943.
• China is telling its citzens to buy gold as an alternative to its unstable money system. Their system is plagued by pressures to revalue and hot money is out of control. Gold is in short supply in China, one of the world’s biggest consumers of raw materials.
• Speculation calls for gold to easily double over the next few years. Technical analysis by Richard Russell reveals that gold should fly to about $3000 US an ounce.
• While gold is down from its highs of late last year the long term chart looks beautiful and its base, or bottom, is a lot higher than last year and this trend doesn’t appears to be changing.
• A revaluation of the Chinese Yuan Renminbi would change its value upwards about 90% and this can be expected to happen soon.
• In fact, some wonder whether the chinese will revalue their currency off of its american peg to a gold standard peg. What would owning gold and the yuan do for a portfolio?!?