The Chicago Mercantile Exchange raised margin requirements to buy gold futures by 22% yesterday afternoon. The minimum amount traders must keep on deposit was $6,075 per 100 oz. contract yesterday. Today it’s $7,425. The massive spike in gold over the last few days all but guaranteed the increase in margin requirements. Gold briefly peeked its head above $1,800 for a few minutes yesterday, but even with the modest pullback today, we are still over $100 higher than we were at this point last week.
Tonight I heard a talking Muppet on CNBC say that, “This move up now puts gold in a bubble.” I say nonsense! The rush to own gold is on. To many people, like the aforementioned talking Muppet on CNBC, gold seems “too high”, “too expensive”. These people are incapable of understanding that the dollar is being denigrated before our very eyes.
On all the pullbacks further establish your positions in gold and silver and then just SIT on those positions. My friends we are in the midst of a very powerful bull market! Bull markets like this gold bull market come along, if we’re lucky, but once a lifetime.
However, this gold bull market is different from recent bull markets like those in stocks and bonds witnessed over the last 20 years. Not only can this gold bull make you rich, but it may also save you from a disaster in your other investments.
Central banks are halting their sale of gold and they have in fact rapidly reversed course. They are now BUYING gold. China, India, and Russia both openly admit that they want to increase their gold reserves. In all history, real wealth (gold) has flowed to the powerful. Do you want to be on the wrong side of history? If not, then stop fighting the gold bull and hop on its back. It’s not too late, I promise!