Once a milestone is broken, we often look to the next one. Last week gold finally reached above the $1700.00 per ounce mark. Today gold is nearly $70.00 more per ounce, hovering right around $1770.00 per ounce. Yes, in less than a week, gold has once again taken a massive leap. Many experts believe gold will effortlessly break the $1800.00 per ounce mark soon, but what about an even larger milestone?
We are now looking at two compelling reasons as to why gold may soon break $1900.00 per ounce. First of all, the news of more financial stimulus (money printing) will surely have an effect. Secondly, demand for gold in India is on the rise.
We all knew it was coming. The next round of quantitative easing (QE3) was finally announced this week and it had a massive effect on gold. Naturally when any form of money printing is announced, we tend to see gains for precious metals. This round of quantitative easing however, was one for the history books.
Bernanke has pledged to print, or create electronically, $40 billion each and every month until the labor market is in better shape. This is an “open ended” round of stimulus that has no set term. Therefore, it may go on for a few months or even well into next year. Due to this fact, gold may have no choice but to eventually start trading above $1900.00 per ounce. With this astonishing level of currency debasement, investors will always run to safe haven investments to protect their wealth – this means buying more gold and silver.
Another reason gold may reach new highs may not be as groundbreaking as this round of quantitative easing, but should not be overlooked nonetheless. India will see slight demands for gold over the coming months due the multiple festivals to come. Buying gold during these festivals (Ganesh, Dussehra and Diwali) is commonplace throughout India. In a country that boasts almost a sixth of the world’s population, this buying cycle is not one to ignore.
As you can see, we are facing two major factors – inflation and demand. So, what’s your next move? Will you sit quietly as these blatant market conditions affect the price of gold? Or will you take action today just like many other savvy gold investors already have.
Call us today at American Bullion to discuss your options. Remember, you can roll over or transfer any portion of your existing IRA or old 401K from a previous employer into a Precious Metals IRA. The rollover is Tax-Free and Hassle-Free.
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American Bullion specializes in adding gold and silver to retirement accounts. If you have a question or would like to know more about your investment options, please call American Bullion at 1-800-326-9598 to speak with a precious metals specialist.