Gold and Energy Advisor: Gold, Oil & Energy Markets Investment Research
James DiGeorgia, Mr. Macro
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Gold and Energy Advisor's Real Wealth

Real Wealth #288  01/26/2011



Iran's Game Plan Is Working; Goverments Collapse in Lebanon and Tunisa; Egypt Next!

Dear Gold and Energy Subscribers,


The Dow Jones may have just broke the psychological 12,000 level but both Gold and oil have been pulling back over the past several days.

Gold is testing the $1320 level and oil looking as if it may test $85 a barrel. I remain convinced that this is a short term respite, correction, in what remains a bull market for both precious metals and energy. Besides the reasons I have cited in recent updates and issues for being bullish on precious metals and oil, there are dark clouds now forming in the Middle East that could fuel a flight of safety to gold and increase the fear premium on oil that could easily push it back into the $90 to $95 price range.

On January 12, Hezbollah and its allies walked out of Lebanon's unity government in a dispute over still confidential indictments by a U.N.-backed tribunal which is investigating the 2005 killing of statesman Rafik al-Hariri, the current premier's father. Now it appears Hezbollah has control of the Lebanese government. They consolidated enough parliamentary votes needed to control the legislature and won the endorsement and nomination of their own choice for Prime Minister Najib Mikati by Lebanese President Michel Suleiman.

Although the press coverage has been very scant, I cant ignore these events and am compelled to bring your attention to the events in Lebanon, the government over throw in Tunisia and increasingly violent protests in Egypt. While the change in government in Lebanon and Tunisia are certainly sounding alarm bells in Washington and raising concerns in moderate Sunni Arab states, this change is not taking place in a vacuum.

Increasingly larger and more violent protests in Egypt are becoming impossible for the world press to ignore. Protesters clashing with riot police wielding tear gas and water cannons are becoming daily occurrences.

At least six young Egyptians have set themselves on fire in recent weeks, imitating the self-immolations that set off the Tunisian unrest. The Egyptian government is so concerned about the rising unrest that it has forbidden gas stations to sell gas to people without cars and has placed security agents wielding fire extinguishers outside of government offices.

Protests like these are very uncommon in Egypt; the Mubarak government has kept a tight grip on the government since the assassination of Anwar Sadat. But there is a video posted on the Internet showing people tearing up a large portrait of Mr. Mubarak — an act whose boldness in Egypt is hard to ignore or overstate.

Despite the large and violent protests in Egypt, the country's state run television has made absolutely no mention of the protests – even as cell phone networks were interrupted or unavailable throughout the afternoon in the Arab nation.

This morning US-based Arabic website Akhbar al-Arab reported Egyptian president Hosni Mubarak's son who is considered as his successor has fled to Britain along with his family. The plane with Gamal Mubarak, his wife and daughter on board reportedly left for London Tuesday from an airport in western Cairo, the website said.

Today's report came as violent unrest continues to break out in Cairo and other Egyptian cities and hundreds of thousands of people have reportedly took to the streets in a Tunisia-inspired day of revolt.

The protesters want Egyptian government to end its 30-year state of emergency and pass a law preventing a president from serving more than two terms, and want the interior minister Habib al-Adly, to resign.

Protests in Egypt broke out after opposition groups waged an Internet campaign inspired by the Tunisian uprising. Weeks of unrest in Tunisia eventually toppled president Zine al-Abidine Ben Ali earlier this month.

Iran is likely doing every thing it can to over throw the Egyptian President Hosni Mubarak

It's no secret to anyone aware of events in the Middle East that Iran has long been a supporter of Hezbollah and its efforts to undermine the Sunni majority government in Lebanon. Iran has also been actively funding radical elements in Egypt, Tunisia, Morocco, Saudi Arabia and other moderate Arab states including Pakistan for the purpose of over throwing those governments.

Egyptian Hosni Mubarak has been quoted publicly speaking out against the regime in Iran for years. Late last years there were additional behind the scenes comments in the Wiki Leaks debacle that revealed an intense hatred of the Iranian Regime. The Saudi King was quoted as encouraging a U.S. Military strike on the Iranian Nuclear program.

How does all this affect the gold, precious metals market?

If the Iranian government continues to succeed, as it has done in Lebanon, and Tunisia... If it is able to ferment an Islamic Revolution in Egypt, Saudi Arabia and even Pakistan, the flight of capital out of these nations will be unprecedented in human history. It will drive gold – and for that matter – all the precious metals to new, much higher highs and at the same time drive the fear premium built into the price of oil to much loftier levels. We could easily see a ramp in the price of oil back to $149 a barrel.

When I first launched the Gold and Energy Advisor, I warned over and over again about the danger President Mahmoud Ahmadinejad and the Iranian radical Islamic regime presented to the world.

This is a man and a radically religious regime who honestly believes we are in the “end times” and it’s their duty to prepare for the coming of the true Islamic Messiah. They are doing everything they can to bring about a United Radical Islamic Revolution that stretches from Pakistan through the Middle East and Northern Africa. Economic sanctions, high inflation and an unemployment rate that estimated by some economists to be as high as 60% hasn't impeded their efforts. They've supplying advanced weapons to Hezbollah for two decades, smuggling weapons to the Gaza Strip and arming Islamic revolutionaries in virtually every moderate Arab state.

While the world is focusing on the economic tsunami taking place in China, worried about avoiding another economic crisis and focused on the world wide terrorist threat Al Qaeda represents. The world is largely ignoring Iran's gambits throughout the world.

Iran's President and Supreme Leader intends to wipe Israel from the world map. Eliminate Western influence in the Middle East, North Africa and Pakistan. Iran's regimes intends to topple every moderate Arab government using radical dogma, money and smuggled arms to accomplish that goal.

The cat and mouse game the United States and Western Democracies have been playing with Iran over its nuclear weapons program has been a failure. Having nuclear weapons will only serve to accelerate Iran's attempt to grab power.

The exit of Egyptian president Hosni Mubarak's son and family from Egypt should remind the world of the exodus of the last Iran Shah's departure. The Iranian people wound up with a much more repressive government

All of this will have consequences far beyond $2,500, $5,000 gold or $150, $200 oil. As your editor, all I can do is warn you about the dangers and point out investment opportunities, especially when gold, silver, platinum, oil stocks and Numismatics look especially inexpensive relative to other investments. Gold and oil may not find their lows before the first week in February. They're both becoming way oversold.

On a lighter note:

An Amazing Rare Coin, Clearly The Finest Known

My friend and new Publisher at Century Coin Group, Inc. in Irvine, California, Todd Griffiths, recently acquired an amazing U.S. Silver Dollar. It's an NGC MS65 1797 Bust Dollar 9X7 Large Letter and is the Finest Known coin of the date.

The coin features the likeness of Ms. William Bingham and was done in 1795 by John Eckstein from a drawing by Robert Scott. Because of the crudeness of the mint and the difficulties of producing coins under such adverse conditions, all of the dates of this denomination are relatively small.

Literally, in 24 years of grading coins, PCGS and NGC together have graded just 7 coins in lower mint state condition and this one coin MS65. The final mint figures show this coin saw a mintage of 4,941 coins struck.

This is a true, one of a kind coin that belongs with an investor / collector who wants only the Finest Known. If you're interested in the coin, you can call Century Coin Group at 1-866-991-2646 and ask to speak with Todd Griffiths.

Best Regards

James DiGeorgia

P.S. Here's a picture of this amazing 1797 Bust Dollar's obverse in the NGC holder.

[Image 1]

Please see risk disclosure link below.