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I was talking to a friend today and he happened to mention that he wished he could buy more gold now, but added he didn’t have any extra money to spare.  He makes a nice living at a Minneapolis manufacturing firm and his wife also works and brings in an additional $40,000.  Together, they earn north of $100,000 a year.  They only have one junior high school child to support.  They are quite conservative and do not spend to an excess. They are doing very well, by middle class standards, yet they have NO extra money left at the end of the month to invest in precious metals.  Now if these folks are having a hard time, what about most Americans who earn far less and have a larger family or have to deal with college tuition and weddings?

Things are worse than I thought.  Inflation and rising taxes are taking their toll.  The result will be a form of class warfare.  Anger and envy will emerge out of a now silent background.  We are living in the final days of the American Empire.  Corruption, fading morality, lies, deception and greed are visible to an extreme, if you focus on Wall Street, the TBTF banks and our politicians.  Sorry, I forgot to add the Fed to this illustrious list, but they should be there, standing in the front of the line.  Hey, enjoy it, do the best you can.  You are living in the most interesting of times – a time of great change is afoot.  We’ll make it through this mess, but we will emerge to a very different world than the one most of us grew up in.  It will be a two-class system, those who are very wealthy and the rest of us.  Set aside enough gold and silver and you may make it into the upper class.

To all of our friends who voted for Obama – well, you got him.  Be careful what you wish for.  Your wish may (did) come true.  This administration may “help” the needy, but the food stamps, extended unemployment and tax breaks will not begin to cover the loss of purchasing power that the Fed and increased Liberal Government borrowing will create which further dilutes the dollar.  Few new good paying jobs and rising commodity costs will drag down all but the affluent.  The middle class is no longer immune from being short of cash.  Obama did nothing in his first term to warrant a second term, but the Republicans came up way short of offering a solid alternative.  Both parties are fighting for the “Best of the Worst” Award.  Looks to me like it’s a draw.  The worst wins – they ain’t no best!

Now, back to the everyday world, here is a T.A. chart that looks encouraging for you gold bulls out there… Gold held support above $1,626.  Gold is $1,663.50 as I write this.  Overhead resistance sits around $1,800.  I say, let’s go for it!

The following chart is from King World News and is by Tom Fitzpatrick.  He believes gold could go lower from here, but his chart is still bullish and he expects gold to rise.

“(Gold) held the medium term channel base at $1,626 (now at $1,627).  We also posted a weekly doji pattern reflecting indecision.  Additional supports and pivots are in and around $1,520.  Only a weekly close below there would suggest a more aggressive down move.  For now the uptrend is still in place and higher levels are expected.”