Archive for March, 2010

Gold continues strength

About five years ago I recall a financial speaker, talking on a radio program, stating that the true bull market for GOLD will have started when Gold was advancing against all currencies.

I suspect that many years from now the bull market will be said to have started in 2009.

The view back shows a divergence, which might lead to a thought that the yellow metal had only a short run for the time … in 2008.

Then, like a turning tide the wave has shifted.

Currently Gold is only showing weakness vs the Australian dollar. Though only a minor weakness at that.
This may be due to the Australian economy demonstrating that it can perform as more than a commodity dominant one, with some robustness in manufacturing and expansion into financial arenas. Whether this current robust condition can be maintained in the face of continued devaluations of nearly all other world currencies is unknown. The elections in progress in Australia have not yet shown what the new face may be like.

The trend showing the “breakout” is best seen on the following comparison chart vs index. The clear line of ‘unison’ can be seen from September 2009, the real ‘break’ from the marketplace is due to happen over the summer and autumn of 2010.

For those seeking to preserve capital, a conservative approach over the coming months will be to shift a percentage of your holdings into physical gold. A common recommendation I have heard is 5-10%, some have spoken of having as high as 25% in gold over the next few years, as the money supply explosion is likely to have an effect on gold demand.

If you have been searching for ways to acquire physical gold and not satisfactorily getting the yellow metal, contact me via info ‘at’ rsreal.com and I can show you how this can be done at spot (or very near spot) prices.

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China debt bubble to burst ?

According to Bloomberg there has existed a significant debt load that has been secured with local government guarantees within China.

These local guarantees are being called into question now and the availability of credit within China looks to tighten.

The flashing red signals about the global debt burden and de-leveraging continue…

The best means to combat this are hard assets in your possession … ask yourself how much silver or gold do you have? At least 5% starts to come to mind.

Paying more than spot price seems a crazy way to get gold, yet as the fiat money goes wild there is only one storage place left for wealth that is portable. Contact me at info@rsreal.com to find out how you can access spot pricing without excess premiums.

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Commercial Real Estate next dominoe to fall …

Charlie Rose talks with Elizabeth Warren, looking at the regulatory reform in the wake of the TARP decisions.

During the interview she very correctly points out that nearly 3000 of the 8000 regional and smaller banks in the US are about to be having to handle under-water commercial real-estate.

Charlie Rose Interviews Elizabeth Warren

My view of this situation, at a minimum will mean a total cut-off of the lending tap. Anecdotal evidence of this has already come to my attention where successful developers, with stable clients are being told to seek their mezzanine financing elsewhere.

Do not expect leverage to be a tool that can be used to acquire real-estate any time in the near future.

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Charlie Munger ~ thoughts from a year ago…

Youtube Video of Charlie Munger of Bershire Hathaway, looking into the future…

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