J in N Idaho

10 Reasons Why Gold Has Further to Run

I find it comical that Bernancke and Bush meet up this week. I am sure Bernancke tells Bush the real truth, especially about inflation. Bush finally hears that people are going to stop spending money on fuel, and start walking. Immediately, we see commodities sink. Oil takes a huge dive. Gold and Silver do the same. They finally found the top end of what people were willing to pay for fuel. Funny how the price decline in oil still hasn't translated to lower pump prices. However, whe oil goes up, pump prices mirror it right away.

I believe Gold will rebound. To drop 70 to 80 dollars either means one of two things: everyone had an automatic sale in place which created a domino affect. However, everytime gold's price moves $0.90-1.00, it means about 1 Billion of actual gold sales took place. This drop in gold price means about $650B of Gold just got sold. I wouldn't be surprised to learn that Dick Cheney and Company just sold their gold stash and that Bush and Company just sold their Oil Stash.

We all know that the drop on interest rates isn't helping the consumer get lower priced mortgage rates. Banks are keeping the spread. We need a new target rate for those using a SS#. Somehow the individual needs to get the benefit. If we had a different rate for those using a business Tax ID#, then there might be a way to get our individuals excited about purchasing homes again. As it now stands, home prices have been lowered to the point where the owner has no equity when they sell. The rates, and down payment requirements have the buyer at his maximum. The gulf inbetween can only be alleviated by lowering the rate, offering, or having the bank accept a short sale. What's it going to be? Short sales aren't getting much press. Rate drops aren't getting to the buyer. Bernancke's trying. Banks are being greedy. Pass over the interest rate you greedy banks. Let that ball out of the corner. Once we see movement, raise the rates.....but, much slower this time. When 2005 peaked, and rates started to climb, that's when all broke down. Give people time to adjust. 1 Point a year max on the upside.