Are Broken Tinker Toys Driving Stocks Lower and Gold to $1800 oz.?

I read a comment the other day, in a Business Insider article, that said, "It is clear the market is held up with tinker toys."Having now suffered six consecutive down weeks, it appears a couple of those tinker toys may have broken.

With QE2 set to expire June 30, and the August 2, deadline for raising the debt ceiling racing toward us, it's as though the markets are sending out a warning - Disaster Is Coming!!

This is not the first time the markets and the economy have experienced QE withdrawal.It was just one year ago when QE1 was set to expire.In anticipation, we got a flash crash in the markets that saw the Dow lose 995 points in just minutes.Then, just as quickly as the indexes fell, rescue arrived.From whom or where was not readily known but some say even a few more minutes and the markets could have been obliterated.

Recovery from the flash crash, however, was short lived.By the time QE1 expired, the reality of failure set in.The economy was not recovering, the dollar began to fall from 5-year highs and the Dow retreated 1500 points off a 2-year high.

As we sit right now, the Dow is off 850 points from a 3-year high and QE2 hasn't even expired yet.If we're in for a repeat performance of the last QE expiration, the markets may be in for 6 more weeks of crashing and crunching.

As the markets began to falter last May of 2010, gold rallied to new highs above $1200 an ounce and since then, except for some very short periods of profit taking, gold has marched steadily higher, outpaced only by silver that has more than doubled since QE1 expired.

These next 60 days of summer are going to be tense as the June 30 expiration and August 2, deadline approach.According to John Embry, Chief Investment Strategist for Sprott Asset Management . . .

"If you want to withdraw enormous amounts of stimulus by cutting thedeficit dramatically at this point, or if QE2 actually marks the end ofquantitative easing there's no question that the United States'interest rates are going to go up dramatically because from the numbersI look at, the Federal Reserve has been buying the vast majority ofall the treasuries that have been coming into the market."

"In my opinion we have reached the point of no return.We are eithergoing to take a collapse in the dollar or a collapse in the economydepending on which direction they take.The idea that they can returnto normalcy in my opinion is out of the question at this point.Theyare way too far off line." Full Article

Talk about choices.With two collapses to choose from, which one will drive you to the safe haven of gold for your savings and retirement accounts.Embry also pointed out that with the rising gold demand from gold-hungry countries and central banks, combined with a surge of summer domestic buying from nervous investors, we could see gold prices rocket to $1800 an ounce in just 3 months.

Now factor in the reality that you can't keep printing money forever without arriving at a date where you can no longer afford your payments, and option 3 has to be added to the two "collapse" choices.Option 3 is both of the above.They say default is not an option but how can it be ignored?In the event of default all the tinker toys break and everything collapses . . . Except Gold!

For breaking gold news every day, visit LearCapital.com and see why experts say gold is your best investment to protect and grow your savings and retirement accounts in these uncertain times.