Stoughton, WI -- (SBWIRE) -- 01/30/2013 -- It is noteworthy that while gold is actually weaker in most currencies today it is again higher in Japanese yen as the yen offers fallen sharply on the worldwide markets due to concerns the yen will be devalued in the coming several weeks. Gold in yen terms remains near record multiyear levels above 0.150 million yen per ounce. New nominal highs in yen terms over 0.2 million yen per ounce are only a matter of time.
Sources reported that Credit Suisse says gold holders may have removed gold from the euro zone due to the region’s financial debt crisis. They noted the Bundesbank comment about capacity getting available in its own vaults in Germany.
The World Economic Forum is into its second day in Davos, Switzerland, and with the theme of ‘Resilient Dynamism’ it seems a good time to announce or even spin positive news in Europe like a slight growth in consumer morale and confidence. I’m not sure what Europe the Davos attendees live on but Ireland, Spain, Portugal and Greece’s ‘recoveries’ are bleak at best. Spanish youth unemployment has risen again and is now nearly at 60%.
The U.S. House of Representatives passed a Republican led plan to allow the federal government to keep credit money through mid-May. The borrowing and cash printing party can continue a little while longer but it would be wise to prepare for the hangover.
Owning physical gold today is akin to drinking lots of water and having a few painkillers on hand. When this party ends, those not owning gold are going to suffer one hell of a financial hangover.
“Everyone should keep gold in their portfolios” as the precious metal will be able to offer value to investors actually in a worst-case scenario, said Marc Faber, the publisher of the Gloom, Boom & Doom statement.
“In the worst case scenario, in the systemic failure that I anticipate, it would still have some value,” Faber, who is also the founder and managing director of Marc Faber Ltd., stated today at an event hosted by Evli Bank Oyj in Helsinki.
Faber said their outlook was so bleak that he is “hyper bearish”. He joked that “sometimes I’m so worried about the world I want to jump out of the window.”
He wisely asserted `I advise everyone to have some gold.' Faber said that he thought there could be a flight out of cash and overvalued bonds and into equities and gold. In response to a question from Yale University’s Robert Shiller querying the recommendation to hold gold, Faber said: “I’m ready to make a bet, you keep your U.S. dollars and I’ll maintain my gold, we’ll see which one goes to zero first.”
Shiller, who is the co-creator of the S&P/Case-Shiller index of property values, replied "I'm inclined to think gold prices after this crisis might return to a lower level. Given the low yields of the alternatives, i.e., bonds, the valuation of the stock market doesn't look so bad."
Faber, whose advice has protected millions of investors in recent years, warned of a global systemic crisis possibly due to massive size of the global derivatives market that is now worth over an incredible $700 trillion.
He warned “when the system goes down,” and just plastic credit cards are left, “maybe after that people will realize and go back to some gold-based system.”
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