Gold Prices Increasing

Many Reasons For Gold Prices Increasing

Gold prices are rising and are expected to rise much further over the next few months for a number of reasons. Gold reached over $1,700 per ounce on Thursday along with Platinum but this was not just a flash in the pan. There are many different factors that are set to push the price of gold up over $2,000 per ounce in the short term and many experts are predicting $2,500 to $2,800 is very achievable during this year.
Gold Price UpChinese New Year starts on Sunday, February 10th and the celebrations last for 15 days. Traditionally Chinese New Year is a time when there is a large amount of gold purchased in the form of both jewelry and bullion investment. A large increase in gold buying is expected over the next few weeks to meet the anticipated demand. China became the world’s largest buyer of gold in 2011 and although they produce about 350 tons of gold per year, they consume more than double that amount.

India is the world’s second largest market for gold. There are serious rumors that the Indian government intends to impose an increase to the import tax on gold by six percent later this year. This will obviously cause gold prices to go up as investors increase their gold investment holdings before the Indian government releases the bad news about the import duty. The effect of the increased gold buying in India is likely to start pushing the price of gold upwards throughout February and March.

The weakening of the US Dollar is expected to continue as we see sustained monetary easing. This will cause further devaluation of the dollar as the US Government faces big problems over the debt ceiling. Traditionally, as the US Dollar decreases in value the price of gold increases. This has been the driving force behind the large increases in the value of gold over a number of years.

Value Of Dollar FallingMany countries around the world are concerned about the US Governments ability to pay its debts. Further unrest came to the forefront last week when Germany announced they would be more comfortable having their gold reserves in their home country rather than in the US Federal Reserve. Germany’s Audit Court told the Bundesbank to examine its gold assets in the US, saying their existence has never been verified. The Bundesbank have said that the returning gold will be examined.

A spokesman for the Bundesbank declined to comment about the cost involved for repatriation of their gold from the US to Germany only saying “it is economically tolerable for us”. The German gold is currently stored in New York for free but the German gold stored in the UK has a yearly charge of 500,000 Euros by the Bank of England. The Bundesbank has requested 300 tons of their gold be transferred from the Federal Reserve to Germany but they have said that German gold held by the Bank of England will remain unchanged.

These are just a few of the different factors which are likely to push the price of gold up over the next few months. The real indicator that a seriously large increase is imminent is if we can see a weekly close near to $1,700. As soon as this occurs we will be looking at a new resistance level of about $1,760 but if gold continues through that barrier then we will be looking at a whole new range of between $1,770 and $1797. Many experts are predicting that after we break through the $1,800 level the price of gold will rise sharply and most are talking about levels in excess of $2,400 later this year.

Printing Money To Pay Debts

A $1 Trillion Platinum Coin!!!

If Congress refuses to increase the debt limit, policy makers are debating whether or not a platinum one trillion dollar coin would be a good way for President Barack Obama to gain leverage against the Republicans in the upcoming debt ceiling fight. The Federal Reserve controls the US printing press and the Treasury is not allowed to print money to cover the government deficits. However, a loophole in the law allows the Treasury unlimited ability to produce platinum coins of any denomination (for coin collectors).

Trillion Dollar Platinum Coin

ONE TRILLION DOLLAR PLATINUM COIN – CRAZY

Minting of a one trillion dollar coin is being considered by The Treasury, bypassing the collectors market and depositing it with the Federal Reserve so the Treasury can continue to pay bills after the debt ceiling has been reached. Theoretically they could mint a regular size coin with just 1 ounce of platinum but with a face value of one trillion dollars. The Treasury is not allowed to print more money to pay the nations debts because that just causes a further increase in inflation. This loophole in the law could allow the Treasury to do exactly that which will just cause further problems with our economy.

Recklessly Printing MoneyThe Government has been recklessly printing Dollars for many years now which only dilutes the value of the money in your pocket. Every time they roll the printing press your existing dollars become worth less. This is just another hidden tax.

Several economies have been completely destroyed when reckless governments have used the printing press to pay debts which they cannot afford. It is similar to having a whole bunch of credit cards and continually using one card to pay off the next until one day you are all maxed out. Our government has been doing this for a long time and they are already maxed out but instead of fixing the problem they are still looking for yet another Band-Aid.

Unconstitutional Paper Money
Paper money NOT backed by gold or silver is unconstitutional. Article 1, sections 8 & 10 of the constitution clearly states that “No state shall make anything except gold and silver coins for paying debt unless it is backed by gold or silver”. The reason for this is to avoid inflation. If the Government prints Dollars which are not backed by gold then those dollars are worthless so when they are put into circulation they automatically reduce the value of all of your existing dollars by diluting their value. The result is higher prices for you on everything you spend, also known as inflation.

Burning Money To Stay Warm

BURNING MONEY TO STAY WARM

Germany printed billions of Deutsch Marks after the end of the war to pay compensation to a number of countries. The result was a massive inflation increase causing prices to skyrocket. A loaf of bread or a pint of milk was costing Germans millions of Marks. Many people resorted to burning Deutsch Marks to stay warm because it was cheaper than paying fuel bills and the Marks was almost worthless.

The US Government has been printing Dollars not backed by gold for many years now which has been causing a gradual dilution of its value. Over the last 100 years the value of the US Dollar has decreased by 97% according to the US Bureau Of Labor Statistics. If they continue down this path your dollars will not even be worth the paper they are printed on. This is the main reason why so many people prefer to invest in gold which has been increasing in value every year rather than leave their money in paper dollars which are dramatically reducing in value.

Value Of Dollar FallingYour dollars are worth 97% less than they once were.

In 1971 if you had invested $35 in 1 oz of gold it would be worth $1,700 today which is an increase of almost 5,000%. If you had kept that same $35 in cash paper money it would still be worth just $35 but now it will only buy you less than one tenth of what it would have bought in 1971. Therefore, your $35 in paper money has reduced in value by more than 90%.

 

US Mint Sold Out

US Mint Sold Out

American Eagle Silver Bullion Coins 2012 sold out after a huge increase in sales during December. It was the third largest level of December sales in the history of the Silver Eagle with orders for more than 1.6 million ounces. The US Mint told authorized buyers that the 2012 American Silver Eagle bullion was sold out in mid December and there would be no more of the 2012 coin minted.

American Silver Eagle 2013 Obverse

AMERICAN SILVER EAGLE 2013 OBVERSE

American Silver Eagle 2013 Reverse

AMERICAN SILVER EAGLE 2013 REVERSE

 

 

 

 

 

 

 

 

The 2013 Silver Eagle bullion coin will be available to order from January 7th but this leaves a three week period at the busiest time of the year for the US Mints most popular coin. There is normally a rush of orders in January from authorized buyers which is likely to be significantly exasperated by the three week void of supply from the US Mint.

The US Mint only sells the American Eagle Silver bullion coins through a network of authorized buyers and not direct to the public. They are purchased in bulk and the price is calculated from the current price of silver plus a fixed premium. They are then sold on to other coin dealers, bullion dealers and to the public.

The US Mint released their 2013 annual product schedule on December 19th, earlier than usual. Acting Director Richard Peterson said they are listening to their customers and by releasing the schedule early it is a reflection of their commitment to their customers and a continued effort to give their customers as much info as possible.

American Gold Eagle 2013 Obverse

AMERICAN GOLD EAGLE 2013 OBVERSE

American Gold Eagle 2013 Reverse

AMERICAN GOLD EAGLE 2013 REVERSE

 

 

 

 

 

 

 

 

The United States Mint decided to change their production plans for both the one tenth ounce and the one ounce American Eagle Gold bullion coins following very strong sales during November. However, it seems that the US Mint didn’t make alterations to the plans for minting the Silver Eagle bullion coins.

The Silver American Eagle 2013 will also be minted in various different versions for collectors. The 2013 Silver Eagle Proof will be released two months earlier than usual on January 24th This coin will have the frosted relief on a mirrored background giving it the familiar cameo effect. The price for the Silver Eagle Proof is likely to be $62.95 which will be a $3 increase on the 2012 coin which sold out in November.

The American Silver Eagle Uncirculated 2013 is scheduled for release by the US Mint in May. This coin will have the “W” mint mark and will be struck on specially burnished blanks. These collectors’ coins are expected to be available for $53.95 which will be a $3 increase on the 2012 version which is still available to purchase.

The West Point Silver Eagle Set is scheduled for release in May or June. This set is to commemorate the 25th anniversary of the “mint” status of West Point. Although West Point was built 50 years earlier it did not become an official branch of the US Mint until 1988. This will be a special two coin set with one Silver Eagle reverse proof and one Silver Eagle uncirculated coin, both displaying the “W” mint mark.

Reverse proofs are minted in the opposite way to conventional proofs. The main design features and inscriptions are mirrored and the background is frosted. The price for the West Point Silver Eagle set is expected to be around $160.

Gold Investors Celebrate

Gold Spot Price Expected To Rise Much Further

Investors in gold and the other main precious metals have plenty to celebrate after the US Congress approved the long awaited deal on Tuesday. The agreement is a temporary fix to prevent the US economy from falling off the “fiscal cliff” into deep recession. The instant reaction from the financial markets caused a global rally today (Wednesday Jan 2) with commodities increasing sharply while government bonds and the US Dollar fell, as expected.

The weakening US Dollar causes commodities priced in USD to increase because they are effectively made cheaper for holders of other foreign currencies. If gold can close above the existing resistance level of $1685 then we are likely to see more widespread speculation pushing the price of gold in excess of $1720 per ounce. At this moment (1:15pm ET) spot gold price is up to $1688 and expected to rise further before the close.

Gold Price History - Gold Price UpAll four main precious metals are on the increase today as an effect of the weakening US Dollar. Besides gold heading towards $1,700 per ounce, palladium is up to $708 and platinum has increased more than $30 per ounce so far today. Historically, the price of precious metals and especially gold has had large increases when the economy is in turmoil, unemployment increasing and the US Dollar is declining against other world currencies.

Silver prices are expected to go “off the charts” during this year for two major reasons. There is likely to be further weakening of the US Dollar because of the continuing economic problems which are not going away anytime soon. Also, the huge rift between the supply and demand for silver continues to become wider. The demand for silver by investors and by industry far exceeds the amount of silver being mined. As the momentum increases further during 2013 it is expected that the price for silver will go crazy as the basic rules of supply and demand take over.

Gold Bullion CoinsInvestments in gold and other precious metals have yielded good profits during 2012 with all four main metals increasing significantly. It is easy to predict that precious metal investments will continue to increase in value during 2013 but it is difficult to forecast which of the main four will increase the most. Many investors are choosing to leave the majority of their existing investments in gold and diversifying their portfolio by making new investments in silver, platinum and palladium.

Only five years ago gold was less than $600 per ounce and has increased more than 275% since then. Although nobody can give a solid guarantee that gold prices will continue increasing at this rate, most investment experts are convinced that they actually will. A lot of reputable and highly regarded investment specialists are predicting that gold is likely to achieve well over $2,000 per ounce during the course of 2013.