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Gold Gears Up For Its Next Big Move
-- November 8, 2002
Around the globe, there are developments that are prompting overseas investors to snap up gold.
First, Japanese investors are watching their economy fall apart! The Japanese government recently watered down its bank reform measures. This action is going to prolong the clean up of bad debts that prevent Japanese banks from making new loans. With $1.5 trillion in bad debt, many banks could simply go under. In fact, more than 50 deposit-taking institutions collapsed in Japan in the last fiscal year. The fear of a wholesale banking collapse has driven up Japanese gold demand by 40% in the second quarter.
Second, investment demand for gold is up 30% year over year in the Persian Gulf states, where folks live in the shadow of a looming war in Iraq. And in Saudi Arabia, experts say Saudi gold demand should soar 20% in the fourth quarter versus last year.
Third, China just launched gold trading at its newly established Shanghai Gold Exchange. This is all part of a move to end the government's 50-year monopoly on the gold market. This means ANOTHER 1.5 billion people now have access to international gold markets and gold futures. Demand for gold in China is already huge -- 206 tons last year. This should only increase that demand, and supercharge global demand for gold even more.
We've been telling our Safe Money subscribers that gold is a hot commodity for years. As a result, they're well-positioned in select mining shares. And it looks as if gold is set to take-off.
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