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Gold Rallies as Goldman Sachs Share Price Crash

Commodities / Gold & Silver Nov 11, 2008 - 06:15 AM GMT

By: Mark_OByrne

Commodities Gold and silver were up another 2% yesterday as bargain hunters continue to bottom feed. Oil and most commodities were somewhat higher on news of the Chinese $0.6 trillion stimulus injection while the dollar was flat and the pound fell again (reaching a new low against the euro) due to the sharply deteriorating UK economy.


Gold's non correlation with equity markets continues with most equity markets again under pressure today after the Chinese stimulus induced another dead cat bounce which proved to be another false dawn. With recessions only beginning in all major economies and the likelihood that recessions will be protracted and deep, safe haven demand for gold is set to remain robust.

However, anything is possible in the short term and leveraged trading is for the foolhardy. Risk aversion should remain paramount today and in the coming weeks and investors should shun speculative short term get rich schemes for passive long term investing. Value investors should continue to remain properly diversified and maintain a minimum of 10% to 20% of their portfolio in gold bullion. The old Wall street adage of keeping 10% of your portfolio in gold and hoping it doesn't work has never been more appropriate.

Equities look set to continue to underperform- particularly the financials. Goldman Sachs can be regarded as a form of bellwether or as a proxy for Wall Street and its share price has fallen by some 2/3's in recent weeks. Goldman has fallen from over $240 to $71 per share. It collapsed just 8.5% yesterday alone. It's performance does not bode well for the US financials and US financial system

By Mark O'Byrne, Executive Director

Gold Investments
63 Fitzwilliam Square
Dublin 2
Ireland
Ph +353 1 6325010
Fax  +353 1 6619664
Email info@gold.ie
Web www.gold.ie
Gold and Silver Investments Limited
No. 1 Cornhill
London,
EC3V 3ND
United Kingdom
Ph +44 (0) 207 0604653
Fax +44 (0) 207 8770708
Email info@www.goldassets.co.uk
Web www.goldassets.co.uk

Gold and Silver Investments Ltd. have been awarded the MoneyMate and Investor Magazine Financial Analyst of 2006.

Mission Statement
Gold and Silver Investments Limited hope to inform our clientele of important financial and economic developments and thus help our clientele and prospective clientele understand our rapidly changing global economy and the implications for their livelihoods and wealth.
We focus on the medium and long term global macroeconomic trends and how they pertain to the precious metal markets and our clienteles savings, investments and livelihoods. We emphasise prudence, safety and security as they are of paramount importance in the preservation of wealth.

Financial Regulation: Gold & Silver Investments Limited trading as Gold Investments is regulated by the Financial Regulator as a multi-agency intermediary. Our Financial Regulator Reference Number is 39656. Gold Investments is registered in the Companies Registration Office under Company number 377252 . Registered for VAT under number 6397252A . Codes of Conduct are imposed by the Financial Regulator and can be accessed at www.financialregulator.ie or from the Financial Regulator at PO Box 9138, College Green, Dublin 2, Ireland. Property, Commodities and Precious Metals are not regulated by the Financial Regulator

Disclaimer: The information in this document has been obtained from sources, which we believe to be reliable. We cannot guarantee its accuracy or completeness. It does not constitute a solicitation for the purchase or sale of any investment. Any person acting on the information contained in this document does so at their own risk. Recommendations in this document may not be suitable for all investors. Individual circumstances should be considered before a decision to invest is taken. Investors should note the following: The value of investments may fall or rise against investors' interests. Income levels from investments may fluctuate. Changes in exchange rates may have an adverse effect on the value of, or income from, investments denominated in foreign currencies. Past experience is not necessarily a guide to future performance.

All the opinions expressed herein are solely those of Gold & Silver Investments Limited and not those of the Perth Mint. They do not reflect the views of the Perth Mint and the Perth Mint accepts no legal liability or responsibility for any claims made or opinions expressed herein.

Mark O'Byrne Archive

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