Jeff's Editorial #186 - Is it time to sell your gold?

This is my opinion

Is it time to sell your gold?

Gold has been hoarded by some investors, and has risen in price as high as $1,900 an ounce last September, but is now down to $1,540 an ounce.  Gold price has been on the decline in the recent weeks due to several factors:

1. Fear that Greece may exit the EuroZone has created huge uncertainty in their economy.  Euro currency is declining.
2. Iran is now talking seriously to the AEC about its nuclear program
3. American, Chinese, and Indian economic growth is losing its steam
4. Oil prices are going down (oil and gold prices are correlated)
5. Gold demand is decreasing

Many investors are fearing that gold prices will continue to get depressed in the weeks and months to come.  Some will start dumping their gold soon.  When the pace of dumping increases, a rapid drop in prices will be seen around the globe.

I think that gold prices will start to perk up again with the next conflict somewhere in the world, but the long-term scenario is that gold boom will soon turn into a gold bust. Silver prices are already plunging.

One caveat: if you sell a gold or silver coins or collectibles, your capital gains tax rate is 28% regardless of your income.  Gold ETFs, stocks, and mutual funds are treated just like regular investments (0% or 15% capital tax rate)

This is an educated guess