Terror Fears Spike Gold
Bill RidleyThree years ago we got back into gold due to the obvious fundamentals showing the dollar would be deteriorating in value. However I never expected in my wildest imagination, the bizarre and unfortunate turn of events which most recently have given gold a boost.
Helicopter gun ships over New York?
While looking over Friday morning's paper I was surprised to see a picture of a coast guard gun ship flying by Staten Island with the headline: U.S. braces for al-Qaeda Attack.
Tom Ridge, the homeland security chief, said the government is stepping up security based on credible reports that al-Qaeda is planning some sort of terrorist activity before the U.S. presidential election.
Though no specific details were forthcoming from Ridge, he did say that given the pre-election terror attack in Spain earlier this year and recent arrests in England, Jordan, and Italy, he felt it "very important" to let Americans know what is happening behind the scenes.
One intelligence official commented that plans for a terror attack are believed to be near completion.
Ridge's comments certainly didn't do the dollar any favors which a week earlier got significantly hammered upon the news from the U.S. Labor Department showing less than half of the expected 250,000 new jobs were created in June, totaling just 112,000.
While the fundamental news was positive for gold, the mass media in the U.S. didn't connect the dots to another headline story which came out at the same time in Cairo which no doubt was more responsible for gold's surge of far as Europeans are concerned: Get out of Iraq or else.
The same group who claimed responsibility for the deadly train bombings in Spain that killed 190 people gave a stark warning to European countries they have only until the end of this week to withdraw troops from Iraq or face the consequences.
The statement run by the Asharq al-Awsat newspaper referred to a 90 day ceasefire for attacks in Europe that the leader of al-Qaeda, Osama bin Laden, declared on April 15th.
"To the European people: Only a few days remain for you to accept the truce offered by bin Laden. Otherwise you will have nobody but yourself to blame," a London-based paper quoted.
The paper said it had received a statement from the "Brigade of Abu Hafs al-Masri (al-Qaeda)," the same terrorist group that claimed responsibility for the deadly train bombing in Spain on March 11th.
On Friday gold hit a new 3 month high of $406.50.
Let's hope and pray that these threats pass without consequence. It should be noted by gold investors that the recent moves in gold are more largely due to gold's attraction as a safe haven insurance policy against turmoil and anarchy.
So over the coming weeks - if the media stories on terror subside, we may see a pullback in gold while the insurance money leaves and we get back to the basic fundamental facts that the dollar is being eroded by Greenspan's mismanagement - that's enough terror for me thank you.
Online Investors News
July 13, 2004
OnlineInvestorsNews is an independent electronic publication committed to providing our subscribers with factual information on selected publicly traded companies, politics, business, and economics. All companies are chosen on the basis of certain financial analysis, and other pertinent criteria with a view toward maximizing the upside potential for investors while minimizing the downside risk, whenever possible with the added aid of technical analysis.
OnlineInvestorsNews and its editors do not accept compensation from public companies featured in this publication.
All statements and expressions are the sole opinions of the editors and are subject to change without notice. A profile, description, or other mention of a company in the newsletter is neither an offer nor solicitation to buy or sell any securities mentioned. While we believe all sources of information to be factual and reliable, in no way do we represent or guarantee the accuracy thereof, nor the statements made herein. The staff of OnlineInvestorsNews are not registered investment advisors and do not purport to offer personalized investment related advice. The publisher, staff, or anyone associated with, or associated to, OnlineInvestorsNews may own securities mentioned in this newsletter and may buy or sell securities without notice.
The profiles, critiques, and other editorial content of the OnlineInvestorsNews may contain forward-looking statements relating to the expected capabilities of the companies mentioned herein. The reader should verify all claims and do their own due diligence before investing in any securities mentioned. Investing in securities is speculative and carries a high degree of risk. The information found in this profile is protected by copyright laws and may not be copied, or reproduced in any way without the expressed, written consent of the editors OnlineInvestorsNews. We encourage our readers to invest carefully and read the investor information available at the web sites of the Securities and Exchange Commission ("SEC") at http://www.sec.gov and/or the National Association of Securities Dealers ("NASD") at http://www.nasd.com. We also strongly recommend that you read the SEC advisory to investors concerning Internet Stock Fraud, which can be found at http://www.sec.gov/consumer/cyberfr.htm.
Readers can review all public filings by companies at the SEC's EDGAR page. The NASD has published information on how to invest carefully at its web site.