Current gold coin prices are not yet as affected by negative sentiment toward banks and bankers as they will be in coming months.

November 22, 2011 – Current gold coin prices are not yet as affected by negative sentiment toward banks and bankers as they will be in coming months. While major institutions such as Goldman Sachs and Credit Suisse can cite the negative real interest rates as an indicator for spectacular future performance in gold, those same banks cannot as easily point to their own shortcomings as a huge driver for the price of gold in the very near future.

There is a report out today that JP Morgan has a balance sheet that is leveraged beyond the levels of Enron. Enron corporation was one of the world’s leading energy companies its sudden and shocking bankruptcy in December of 2001 that included accounting fraud, criminal charges, and the destruction of employee investments and retirement savings.

While there is not any implication that any type of fraud or criminal behavior is currently happening at JP Morgan, there is the keen comparison between the two balance sheets as an indicator for how Americans are feeling about their banks.

Last week, MF Global went belly-up and now cannot account for at least $600 million of its customer’s funds. There are reports today that number is actually over a billion dollars. MF Global was also allowed by CFTC rules to use customer’s funds in the investments that caused it to go bankrupt, meaning what it did was completely sanctioned and made legal by the governmental body that set its regulations. The CFTC Democratic Commissioner Bart Chilton has since said “something nefarious” was happening at MF Global.

It’s impossible to quantify this much negative sentiment but it follows logically that Americans are increasingly fed up with the bad behavior and untrustworthiness of banks, they will reallocate their funds to safe and smart money. Regardless of what you think of banks, there is so much bad press these days you must take it into account when considering the future price and value of gold coins.

While we won’t see the shift overnight, there is a lot of room for Americans to grow into gold. It is estimated that only approximately 3 per cent of Americans own physical precious metal. As there is a resurgence of trouble in the banking sector and more and more Americans look to safe, reliable, and sound money, the price of gold coins, in a few month’s time, will benefit. The market is set for the metals.

Kevin Johnson

Senior Staff Writer –

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