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June Lows Often Mark The Beginning Of A Long Rally In Gold And Silver

By Peter DeGraaf
Date: Thursday, June 19, 2014 4:29 PM EDT

This chart courtesy www.seasonalcharts.com  shows the historical trend of the price of gold, based on 30 years of data.  Once the doldrums of June and July are out of the way, price usually rises until January-February. The challenge is to catch the June lows.

This chart courtesy Federal Reserve Bank of St. Louis shows the total amount of debt in the USA is now 60 trillion dollars.  This cannot possibly be paid off, and it will be inflated away.  Gold and silver will benefit.

"Gold, unlike all other commodities, is a currency...and the major thrust in the demand for gold is not for jewelry. It’s not for anything other than an escape from what is perceived to be a fiat money system, paper money that seems to be deteriorating."
-– Alan Greenspan, ex-US Federal Reserve Chairman, August 23, 2011

This chart is also courtesy Federal Reserve Bank of St. Louis.  The chart shows the Base having just topped the 4 trillion dollar level, and it does not reflect any ‘tapering’!  Instead it shows the US Monetary Base has increased from 800 billion dollars to over 4 trillion dollars in just 5 years.  This new money has inflated the bond market and the stock market, and soon a lot of this money will find its way into the precious metals sector, as price inflation motivates investors to seek protection from ‘asset destruction’.

This chart courtesy www.zerohedge.com  shows someone making a gold purchase of almost half a billion dollars early on Thursday June 19th.  Sometimes ‘they do ring a bell!’

"It is a sobering fact that the prominence of central banks in this century has coincided with a general tendency towards more inflation, not less. [I]f the overriding objective is price stability, we did better with the nineteenth-century gold standard and passive central banks, with currency boards, or even with ‘free banking.’ The truly unique power of a central bank, after all, is the power to create money, and ultimately the power to create is the power to destroy."
-- Paul Volcker, ex Federal Reserve Chairman (in the Foreword of "The Central Banks")

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Please do your own due diligence. Peter Degraaf is not responsible for your trading decisions.

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