Metals Charts: Inflationary Forces at Work?

I’m not crazy about this broadening pattern that is forming on these weekly charts, but for now support has held and it seems that precious metals want to move higher when you consider the movements recently in the miners. Especially given the weakness in the US Dollar, it’s likely inflationary forces are at work here and gold/silver will move higher.

Comments

[Leif Peterson:]

In 3-5 years, you will want to be in PM quite heavily because of inflationary pressure from monetary policy(printing money). At that point, Peter Schiff will be doing quite well. As a fundamental gold bug myself, I have been burned before in PM because of the speculative nature -- i.e., it is *assumed* the value will increase, vs. earnings translated into dividends by well-managed under-leveraged corporations. I think, however, that Shiff's argument for the impending West to East transition of both fiat currency and wealth (economic "governance") implies that owning PM may be the only way to hedge from the collapse of the dollar and the US economy.

May 17 09:03 AM

[Market Sniper:]

Seems to me we have two distinctly different drivers that are currently at odds with each other. #1..according to the latest BIS report, global bank credit money deflation is now rolling at an annual contraction rate of 22%. The effect economically of this is that the global price mechanism must flex downward to reconnect to the lower total stock of money. #2 Central banks globally are holding official interest rates at or below 1% and are engaged in direct infusions of "money" directly into banking and financial systems. Such infusions have a consequence. The consequence is the competitive devaluation of ALL fiat currency which then shows up as high inflation and, at the current rate of creation, probable hyper inflation. The confusion lies in the concept that credit=money (fiat in this case). The two may act very similar but they are NOT the same! Got gold?

May 17 03:14 PM

[capt Brian:]

Charts, tealeaves, questions with no answers on and on, if anyone cannot understand the forces that are causing precious metals to become more valuable, and probably, over the haul will simply go up. For my money, gold is nto racing to new highs on a daily basis as the chartists would say, "if this thing closes over ### it is gonna run. more BS than a farmer would use in ten lifetimes.

I like the way the metals are slowly and inexorably moving in the direction of a world falling apart. Now we have drugs in the air, and the Spanish govt says, "it's okay, nothing will hurt you", while the police arrest folks for using the same 'dangerous and banned substances.

I am getting all the good stuff I can.

Just look at California, their only chance is to secede from the Union and apply for foreign aide.

good luck to us, I wonder what America will be like on the other end of this black ole we are entering.

May 17 11:57 PM