Capital Gold Group Reports on 9/11 Impact on Investor Demand for Gold

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Sep 13, 2010, 08:13 ET

LOS ANGELES, Sept. 13 /PRNewswire/ -- On the 9th anniversary of September 11, 2001, Capital Gold Group, Inc. reports that the terrorist attacks had such a major impact on investor sentiment that it accelerated the beginning of the current bull market for gold. "September 11, 2001, was a wakeup call for all Americans," said Capital Gold Group CEO, Jonathan Rose, RFC. "From that day on, Americans realized that terrorism could have a major impact on financial markets, and many turned to gold for safety and protection."

The financial markets never opened on the fateful day of September 11, 2001, and remained closed for the next four trading sessions. When stocks began trading again on September 17, 2001, investor sentiment was predictably fearful, and the Dow Jones Industrial average plunged 684.71 points, which at that time was its biggest one-day point loss in history. As a result, over $1.4 trillion was lost in the stock market in one week, portfolios and retirements were devastated, and years of growth were lost and never recovered.

Subsequently, investors began to understand the impact of terrorism on financial markets and sought the safety and protection of physical gold for their long-term savings and retirements. Institutions, corporations, central banks, hedge funds, pension funds, and even college endowment funds today hold allocations in physical gold as protection for reserve assets. Concerns over possible future terrorist threats to our financial system, continued volatility, the shrinking U.S. dollar, and government fiscal and monetary policy are increasing demand for gold bullion, investment-grade Pre-1933 gold coins, and Precious Metals IRAs.

Almost immediately after September 11, 2001, government debt rose substantially to cover the costs of homeland security and now stands at over $13 trillion. The dollar index has fallen more than 40 percent and gold, which is a reflection of the U.S. dollar's decreasing value, has grown over 400 percent. This consistent growth averaging more than 20% per year saw spot gold standing at $285 per ounce on September 11, 2001, and closing on September 10, 2010, at $1,246.70.

Capital Gold Group's new website, www.StartWithGold.com, offers a Free Guide to Owning Gold and features historical charts allowing site visitors to track the growth of gold for up to a 10-year period.

Where is gold expected to go from here? Capital Gold Group CEO, Jonathan Rose, RFC, and other experts are forecasting gold at $1,300 by the end of 2010. According to a recent Bloomberg survey of 29 analysts, traders and investors, gold could reach $1,500 per ounce by the end of next year. Dan Brebner, an analyst at Deutsche Bank in London and the most accurate forecaster so far this year, says the metal may reach $1,550. More than 70 leading analysts and experts are predicting gold will reach $2,500 per ounce or more in the next 5 to 10 years.

Gold has averaged $1,166.43 since January, 2010, heading for a ninth consecutive year of higher average prices, the longest streak since at least 1920. Analysts have raised their 2011 forecasts, predicting a tenth annual advance, data compiled by Bloomberg show.

Options traders seem to agree with gold's most accurate forecasters that the longest rally in nine decades still has farther to go. The biggest position is in call options expiring in November 2010, giving traders the right to buy the metal at $1,500 by then. The next biggest position is the call option for $2,000 expiring in November 2011, data from the Comex exchange in New York show.

Capital Gold Group, Inc., one of America's leading and most trusted providers of physical gold, is highly rated and accredited by the Better Business Bureau and is a member of the Professional Numismatists Guild, representing the top echelon of U.S. and coin dealers worldwide. CGG has its headquarters in Woodland Hills, CA and can be reached at 800-510-9594. CGG offers physical gold for direct delivery and in Traditional, Roth or Sep Precious Metals IRAs. Through Facebook and Twitter, Capital Gold Group clients and fans can follow gold prices and all the latest day to day news developments impacting gold.

WEBSITES: http://www.StartWithGold.com

http://www.theCapitalGoldGroup.com

FACEBOOK: http://www.facebook.com/capitalgoldgroup

TWITTER: http://twitter.com/StartWithGold

SOURCE Capital Gold Group, Inc.