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Now is the Time to Buy Gold

Given the false hope inspired by the conclusion of the G20 summit in London last week, and its associated residual 'positive sentiment' effect on global equity markets, now is a good time to accumulate gold and related asset classes. Thats because the price has suffered excactly the kind of steep correction that over the last 8 years have typically preceeded a fresh assault on new highs.

And there are other telltale signes that gold is about to take a Great Leap Forward.

Foremost amongst them is the fact that the AMEX HUI Goldbugs Index is foreshadowing a jump with its habit presaging enhanced interest in gold with a sharp drop followed by a sharp rise. (The rise part of the equation has yet to form).

Secondly, the engineered 'positive sentiment' by U.S. media nad fiancial elements has now served its purpose, which is to lend a mantle of crediblity to the G20 process by allowing participants and leaders to point to robust markets as proof that their collective actions embodied in 15 pages of summary were in fact successful.

Third, there is the deluge of corporate earnings to be unleashed pre and post Easter weekend, which are almost unifomrly awful. S&P 500 companies are expected on average to decline 37 percent, the eighth straight quarter of double digit losses in quarterly earnings.

And finally, analysts (to use the term loosely) have seemd to arrive at the unanimous conclusion that the IMF's planned sales of gold to raise $50 billion will have no meaningful impact on the gold marktet. Maybe thats because, as GATA will tell you, they don't have it.

SOURCE: http://www.midasletter.com/news/09040703_Now-is-the-Time-to-But-Gold.php

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