By Michael M. Pennington 

For several weeks now I have been warning customers that Gold and Silver were about to go back up and exceed previous highs. We are beginning to see the moves predicted at this time. The trend of course is being driven by a weak dollar, the same driver of higher oil prices. It’s inevitable that the dollar will continue to collapse. Higher deficits, additional government bailouts, a deluge of dollars worldwide and rapidly increasing inflation are just some of the reasons why. Gold and Silver is your only protection in this environment.

It now appears certain the FED must bailout Fannie Mae and Freddie Mac. They worked hard all weekend coercing many banks to buy their short term notes on Monday morning. Where they might fall short, the FED has promised to make the difference. This is certainly a case of these companies just too big to fail.I predicted this a year ago. It was not just the mortgage crisis responsible for their insolvency, but both companies were targets of Wall Street crooks. Billions of dollars were siphoned off by rich elitists causing  US taxpayers once again to be the bagholders. As I’ve said often, many more financials/banks are also insolvent. This weekend we witnessed the takeover of IndyMac Bank, the second largest in the history of the United States. Experts predict at least 150 more banks this year could go bankrupt. The sad fact is that this is just the beginning and not the bottom as some others want you to believe. The truth is being hidden from the US public so as not to create panic as our once proud financial system is on the brink of collapse. Those who have planned all this profited from what is happening beyond our imagination.

The last straw could very well be Iran. If the US or Israel drop any bombs on Iran, global financial stability of any measure will end. The likelihood of such an event occurring appears more likely each day, probably now being carried out by Israel. OPEC’s chief has said such an event could cause oil to double within a few days. Needless to say the stock markets will plunge around the world. Once again, physical gold and silver is your only protection. As we saw earlier this year, the shortage in physical supply will reappear and if you wait too long there might not be any precious metals left to buy..

Ask yourself, what is the downside to taking a conservative approach by acquiring gold and silver right now? Both have increased every year for the last 6 years. The truth is there is no downside. On the other hand, failure to protect your assets could cause the loss of every investment dollar. Remember the rule, if it burns (such as anything made out of paper) sell it and stay away from it. Stocks, bonds, future contracts are all about to be hurt badly. I am already protected. I am writing this to help others save their assets. DO NOT PROCRASTINATE ANY LONGER!

If you don’t believe me, examine the charts that follow. They tell the whole story. Matters are only going to get worse before they get better…

CHART #1 shows the annual rate of return for Gold since 2001. Compare this to your other investments returns. The bull market in gold has another 12-18 years to run its course. In addition, the silver chart is just as impressive.

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These last two charts clearly illustrate the seasonality of Silver. Always, in late July and early August we see large sums move into the Silver and Gold markets. This year should be even more than normal. This means we are in for an increase in the price of these precious metals very soon. In fact, the move up has already started. I urge you to take action, as matters in the financial community are only going to get worse.