Load Up On Gold and Silver as Bernanke Dives Off the Deep End

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I first thought U.S. Federal Reserve Chairman Ben Bernanke was being deceitful when he denied the existence of inflation – but now I'm beginning to think he's simply delusional.

Anyone who watched or listened to Bernanke's Oct. 4 congressional testimony must have reached the same conclusion.

"Persistent factors continue to restrain the pace of recovery," Bernanke said. Then the Fed Chairman promised to consider yet more stimulus "to promote a stronger economic recovery in a context of price stability."

The irony, of course, is that we don't actually have price stability, but Bernanke refuses to believe this – thus the added stimulus. And that says nothing of the fact that the first $2 trillion of "stimulus" did little or nothing for the overall economy.

This is the same kind of delusion that led the Fed Chairman to proclaim in 2007 that the "the impact on the broader economy and financial markets of the problems in the subprime market seems likely to be contained."

So, with a delusional central bank chairman, an anemic economic recovery, and every indication that prices across the board will continue to soar higher, there's really only one place to put any loose change you have lying around: gold and silver.

Bernanke's Blunder

Back in May, I said gold and commodity investments were attractive for two primary reasons:

  • First, global monetary policy was – and still is – very stimulative. Commodities, especially gold, tend to do very well when interest rates are well below inflation.
  • Second, rapid growth in emerging markets has created a new wave of middle class consumers. Those new buyers are increasing demand – and therefore prices – for industrial commodities.

Of course, following the market turbulence of the past few months, the picture has changed somewhat. While growth in China and other emerging markets remains quite rapid, it appears to be slowing a bit. That has dented demand for industrial commodities. Prices have dropped as a result. Copper, for example, has fallen to about $6,900 per metric ton, from more than $10,000. However, unless the emerging market economies go into a full-blown recession – and I don't expect they will – I would anticipate some recovery here.

On the other hand, monetary policy has gone in the opposite direction – becoming even more stimulative. Bernanke intends to keep short-term interest rates near zero until mid-2013 and he's undertaken a $400 billion "Operation Twist" program to bring down long-term interest rates. Both of these measures have increased monetary stimulus at a time when inflation is already running close to 4%.

That brings us to this week, when Bernanke decried the progress in the economy and indicated that the Federal Open Market Committee (FOMC) would consider even more monetary stimulus – even though three of the group's members are solidly opposed to the idea.

$5,000 Gold – $150 Silver

So far the only thing the Fed's loose monetary policy has succeeded at doing is pushing gold and silver prices steadily higher.

Gold has risen by more than 30% this year, and silver at one point in April was trading 300% higher than it was a year earlier.

These metals have stumbled lately, but with over-expansive monetary policy still intact, they are likely to experience a strong rebound.

Remember, it's not just Bernanke: The European Central Bank (ECB) also has stopped raising interest rates because of the Eurozone's problems. And the Bank of England (BOE) has indicated that it may well drop rates from their current 0.5% level – even though British inflation remains around 5%.

The undeniable result will be a renewed surge in gold and silver prices, meaning the present pullback is an outstanding buying opportunity.

If gold matches its 1980 peak adjusted for inflation, it will hit $2,500 an ounce. If it matches its 1980 peak adjusted for the world economy's growth since then, it will hit $5,000 an ounce. Similarly, if silver were to match its 1980 peak adjusted for inflation, it could climb as high as $150 an ounce.

These are not unrealistic targets. As in the late 1970s, the world's monetary authorities are determinedly trashing the value of paper money and forcing rational investors to look for an alternative.

Panning for Profit

For investors, the simplest way into the metals remains the two large exchange-traded funds (ETFs): The SPDR Gold Trust (NYSE: GLD) and the iShares Silver Trust (NYSE: SLV).

There is a modest amount of slippage between these ETFs and the metals themselves, so their prices are running about 2% behind the metals, but their convenience and liquidity make them the best choice for retail investors.

However, gold and silver mining companies this year have substantially underperformed the metals. The Market Vectors ETF Trust (NYSE: GDX), which tracks gold miners, is about 15% below its Jan. 1 level even while gold itself is up about 15%.

Indeed, miners currently are very cheap compared to the metals themselves. This is especially true of silver. So, gold and silver investors should make sure a substantial part of their portfolio is devoted to the miners, as well as the precious metals themselves.

As far as gold miners are concerned, I would recommend Barrick Gold Corp. (NYSE: ABX), which is currently selling on a price/earnings (P/E) ratio of 12 and Yamana Gold (NYSE: AUY), with a P/E of about 16.

A good silver miner to look at would be Silvercorp Metals (NYSE: SVM) – a rapidly growing Chinese silver miner that trades at roughly 16-times earnings.

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  1. siera romero | October 6, 2011

    Mr, Hutchison, I respectfully disagree with your analysis completely. The main culprit is not the Fed but the possibility of the European Union going under and the effect it will have on this country. Talk about seeing the Micro-view from 35,000 feet up. I think it is better from 30,000 feet. Gold and Silver have very little intrisic value other than emotional comfort. If, you are willing to pay up for that comfort,then fine, more power to you. However, that comfort can also become very uncomfortable and become that way very fast indeed, where Tums is not even going to help! Also, you have repeatedly warned of Chinese companies and to avoid them! Why in the world would you recommend a Chinese silver company? Are you exiting that position in one of your premium services?

    • fallingman | October 6, 2011

      You don't know much about silver, do you?

      It's a critical industrial metal without which you wouldn't have been able to type the message you just posted. Each key on your keyboard has a tiny amount of silver on it that conducts the signal. How's that for ironic? It's indispensible for this function and many more, unless you want to substitute gold that is.

      Emotional comfort…what a crock. Check back with us when silver reaches 200 clownbucks an ounce. In the meantime, maybe you'd like to do some research so that you'll know what you're talking about.

    • Fearon | October 6, 2011

      You have no idea what you are talking about!!

      Gold and Silver are some of the ONLY items on Earth with ANY intrinsic value!!

    • aaron murphy | October 8, 2011

      "Gold and silver have very littlle intrinsic value other than emotional comfort"
      Criminally stupid is the best way I can desribe the people who make such comments. Silver has over 10,000 industrial uses and is second only to petroleum for usefulness. Gold and silver have tremendous intrinsic value and have for 5000 years.

    • Charles | October 9, 2011

      How many people are aware that ever since the Federal Reserve was established and the Fed has raised Interest Rates 6 consecutive times that there has been some level of Recession 90% of the time. When Bernanke raised Rates 14 consecutive times just before the s–t hit the fan he insured one. Bernanke has no choice but to keep the rate at zero until at least 2013. If he raises it in this climate then we are done. The Question is why did he raise it 14 consecutive times in the first place? Check it out. Of course. it didn't help when he raised rates 14 times and people who had ARMS that reset saw their payments go up as much as 80% such as $1200 to $2160 a month. Then we had people using the Equity in their homes as Piggy Banks thinking prices would keep going up and up. When the Selling started with Bernanke and Home prices started falling then the people that had used their Homes as Piggy Banks now owed a larger portion then their Home was worth and they started selling making values even lower. The Banks did not cause the Crash but at this point we found out the extent of their risky Loans which made the situation even worse.

      Gold is not used in Industrial Production and is seen as a safe Haven for the most part. Silver is used in many Industrial applications. The latest application is for the production of 3D movie screens and is also seen as a safe haven.

  2. Gordon Shumway | October 6, 2011

    I am still waiting for a "Toto" to pull back the curtain and expose the "Keynesians" for who and what they really are: academic anarchists who seek to destroy the existing world monetary system, and replace it and the capitalist economies with a One World Government. Keynes' own book , "The Economic Consequences of the Peace" (of 1919), begins:
    “Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, government can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and while the process impoverishes many, it actually enriches some. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.”
    “Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose."

    So it can hardly be claimed by any central banker who admits to being a "Keynesian" that they do not know EXACTLY what they are doing. The next question is, what is going to be DONE about it?

  3. JohnS | October 6, 2011

    Good comments………Still, I like to hold the actual metals!

  4. Michael Hullevad | October 6, 2011

    I do not think that the ETF´s has the amount of bullion to pay up when this market explodes. It is said that it is a geared (100:1) paper Ponzi scheme. I will not invest i SLV for sure.

    • Troy Ounce | October 7, 2011

      Right you are!

      The ONLY reason for owning gold or silver is physical posession of the real stuff.

      ETF's are a scam; give your money away to bankrupt institutions.

  5. c. judge | October 6, 2011

    Helicopter Ben is not delusional like you say but I submit to you that he knows full well what he is doing.His job is to drive the U.S. economy sraight into the ground just like they did in the great depression of the thirties.The ultra rich ,his masters or bosses if you prefer,will swoop in at the appointed time and buy everything for pennies on the dollar.History does indeed repeat itself as we will shortly witness. signed Informed citizen.

  6. Martin | October 6, 2011

    I enjoy Mr Hutchinson's articles hugely, but I think on this occasion he is himself (rather than Mr Bernanke) suffering from delusions of higher prices for precious metals. Did he not observe the wipe-out in prices during the summer? It had nothing to do with inflation.
    We are unlikely to see a rise to those summer highs again. Why? Because the world is saddled with many trillions of debt, whether corprate or individual; to pay the debts down, everyone is going to need cash. Most of that cash will need to be in what is still the world's reserve currency, US dollars. To obtain that cash, all other investments are likely to decline, from stocks and bonds to precious metals. Good luck!

  7. doobs | October 6, 2011

    I am going to go out on a limb here. Bernake like Greenspan is a front man given lines to read like a B grade actor. The US economy always was going to be crashed but it would be very hard to fleece the populace by telling them that their wealth will be stolen from them. So whats needed is a few wars and the ability to print money ad infinitum to enrich the boys up the top without any blow-back. Call on patriotism, greed and ignorance and you have the recipe for success. Just my two cents anyway

  8. McGillycuddy | October 6, 2011

    I suggest that when a 323 year-old institution pulls the plug on it's cash holdings in Europe in order to repatriate these funds back into the British economy, Lloyds of London is sending a clear signal that GBP-£ is a better hold than EC€. When running for Premiership, William Hague was quite right in his "Keep the Pound" campaign. We shook his hand on it in Thrapston, Northants one day. Investors would do well to recognise that precious metals do not change in value. It is the value of the currency in which their price is quoted that changes and that is most frequently downward. The funds that Lloyds retrieves from €urope will have been hard hit by inflation. That's to say that they will not fund the purchase price of as many tonnes of precious metals as they would have in the past. That said, if the funds were left in €urope, their purchasing power would most likely diminish a lot further. I bought a pair of trousers / slacks /pants yesterday from Mr. Price for ZAR120 / £9.41 / $14.57. The ZAR price is exactly the same as I have been paying for 5 years. When we first came here in 2002, the GBP£ price was 7.50. Thus in Sterling terms the cost of trousers has risen 25.5% in 9 years. Thus 'trouser' inflation is 2.83% p.a. in Sterling, yet 0% in ZAR. When you put on your trousers before reading the next issue of Money Morning, have a thought about how low inflation is at present!

  9. malcolm | October 6, 2011

    This article takes no account of the margin increases that have been raised in both silver and gold which caused much of the sell off. neither doesit take into account that JP Morgan are reported to be short more than the total value of the silver market and the legal challeng that is in olace against them for manipulating the market. They have now been let off the hook until January, when they will have to answer these charges

    • fallingman | October 6, 2011

      I hear you…and yet…

      Goldman IS the US treasury and Morgan IS the Fed. If Morgan has been acting as a subrosa agent of the Fed and the Feds all along, I would think they have guarantees in place that they will not only not be held to account but that they won't lose any money either. My guess is they've been effectively indemnified against loss for providing the service of maintaining that huge short position for so long.

      Have you noticed that Morgan and Goldman never answer for anything? They are above the law.
      Simon Johnson's "silent coup" is complete.

  10. Luciano Mutti | October 6, 2011

    Good morning der Mr. Hutchinson,
    I read yr. article on Money Morning's newsletter, and appreciate it very much.
    We publish a newsletter, exclusively on our website and for a small audiience of our customers'.
    We should appreciate it very much if you allowed us to publish yr. article in our newsletter, obviously citing the source.
    Our newsletter is usually put in the website on friday afternoon.
    Looking forward to hear from you soon,
    Best Regards
    Luciano Mutti
    MP Lombard B. & F. C. Inc.

  11. Carlos Paulino | October 6, 2011

    The populist idea of pushing people to hoard gold and silver is a double-edge sword. There is no free lunch. As gold rises, so does inflation. A mass gold rush is like cutting your right hand before a duel with swords. Gold produces nothing but instant profit without regard for future consequences. The gold price is relative to inflation. Whatever gains you get over time are eaten up by its management and securing it, be it ETF's, jewelry or gold bars. Gold profit is an illusion, as you experience the price of food, commodities, fuel and life's necessities rise alongside gold's price. Your profit vanishes overtime, unless you just become a speculator, in which case, you take your chances. If you invested a million dollars when gold recently hit 1900, if you cash in today you'd end up with much less than your million. You gamble. And the G-20 can help you lose with the slightest monetary policy manipulation. Buyer beware.

    • fallingman | October 6, 2011

      Yeah, and if you bought right after Golden Brown was done selling as I did, you've outpaced the depreciation of the currency by orders of magnitude.

      You gamble by holding paper currency. Gold is insurance.

      But by all means, feel free to hold none. I'm sure that'll be a solid plan. I mean, after all, what could possibly happen to the Euro or the clownbuck?

    • fxadvisory | October 6, 2011

      You don't purchase gold to make a 'profit'. You purchase gold to preserve your wealth. If you don't want to preserve your wealth, that's your prerogative.

      • Bill | October 8, 2011

        Exactly right and those that are looking at profit are traders that add volativity to the price. With a volatile price, there are trading opportunities for profit, but for normal people it is a way to preserve wealth. I once saw the something published about the price of gasoline used to be a quarter. Well, today it is still around a pre-1964 quarter. The silver content of the pre-1964 quarters is near the current price for a gallon of gas, in fact it may be higher.

        Basically, inflation raises the price of everything. Takes more dollars to buy everything. If your savings are in gold, chances are your savings have increased at least as fast as the price of the things you need to buy.

  12. Tad Sztykowski | October 6, 2011

    The money will be printed both the Euro and the Dollar.Gold but especially silver will go up to $50 by the year's end and to $100-125 within 6 months.Silver is completely undervalued and above the ground far scarcier than gold.As the dollar weakens and it will the metals will go -up soon.

  13. Roger | October 6, 2011

    It is interesting reading the comments on this board re: Mr. Hutchinson's latest on Gold and Silver. First off, there is nothing special about Gold and Silver (there is some great utilitarian value of course especially in Silver's case and great historical value in both). What is special about them is the fact government just can't "print" them up fiat. But that is not the major point either – albeit an important one. What is – is this simple fact. Assets become over-valued and under-valued. And I was buying when silver was between $3-5 oz recognizing it's undervalued nature. What you want to look for is 3 things as Daily Wealth write Dr S. points out: 1) left for dead, 2) undervalued and 3) just entering into it's uptrend. WITH THIS IN MIND ANYTHING WILL GO UP. That could be gold, silver, dollars, or toasters ! IT IS THE TIME OF METALS AND THAT IS JUST THE WAY IT IS. And conversely, paper assets are generally over-valued and that is JUST THE WAY IT IS. So you go with the trend and make it your friend. Now to some specifics: 1) SVM (Silver Corp) is NOT a Chinese company. It is a Canadian company and abides by Canadian 43-101 standards and Western accounting practices. Yes. They do business in China (and B.C.). But that does not make them a "chinese" company. Their stock is listed on the Toronto and the NYSE. Though the company has recently had some accusations made at it recently for relatively trivial issues IMHO – it seems they have addressed those rather trivial issues and the company seems solid. Their profits are sure impressive !
    2) The Fed absolutely one of the reasons we are in the situation we are in ! Of course the ECB plays a role as well. Let us remember that the Fed controls the WORLD RESERVE CURRENCY. The ECB will play a minority distant 2nd role in this context. But yes the ECB is a factor. The Euro is a factor. What planet is this person that says the Fed is not a factor from ? My word sir. Do your homework and do a reality check.

    3) The thesis that the money-changers steal from the general population via the money supply (the quotes on Lenin are appropriate) is exactly right. Again what planet are you from if you do not know this. THERE IS NO DOUBT ABOUT IT. Anyone who doubts it just does not know their history nor understands basic monetary and economic facts.

    4) Gold and silver (IMHO) have more to run. We are nowhere near the end of our monetary distresses (if your paying attention you know this) and more than likely we will drift up to the levels for gold and silver Mr. Hutchinson is talking about. But either way I am not worried. I always sell into strength and buy the dips cautiously. There are no worries in our household. I am quite certain we will come close to Mr. Hutchinson's targets or at least higher than we did this summer somewhat. Probably somewhere in between. It may take a year, 2 or 3, but more than likely there is more to come.

    And finally holding the physical is the best. But there are great profits to be made for the informed speculator who does his homework rather than blabbing on comment boards all the time ! I rarely do. Just couldn't resist this one. Best. RD

  14. R Barnes | October 6, 2011

    I would have to disagree. the simplest way to invest in some gold and silver to is buy some physical gold and silver. The GLD and SLV are paper scams. The large brokerage firms, namely Morgan Stanley and UBS have been caught only buying futures contracts for people they were charging "vault storage fees" for metal they never bought or ever intended too. If you are going to buy gold, then buy some gold, do not buy a paper promise of a picture of some gold that a brokerage firm has sold the same picture of gold to 50 other people.

  15. jj | October 6, 2011

    There is huge inflation going on in supermarkets.I'm amazed that so many Americans aren't aware of prices of what they buy,or they would be aware of what's happening.Like General Mills downsizing cereal packages by about 40%,while prices rise.Coupon values downsized too.The Dollar has declined by over 98%,against money,gold,since the founding of the Fed,in 1913.Bernanke is pro Dollar devaluation.The Dollar has fallen faster since the govt is going bankrupt.The Dollar is NOT money.It is not a store of value.The Dollar is the common stock of the U.S. govt,which is bankrupt.Still,investors buy govt debt,like it is some kind of valuable commodity.Amazing.

  16. Fearon | October 6, 2011

    Carlos, you do not speculate in Gold because Gold IS money! Prices are only inflating in terms of the transitory (fake) money. Relative to Gold prices are deflating.

    Of course by the time most people figure out the obvious, as they will eventually, it will be too late for the majority of people to source any Gold and Silver.

  17. Naseer Muhammad | October 6, 2011

    The vast majority of people have little or no understanding of the role gold and silver have played in the global economy for thousands of years. Money really is only gold and silver and has been used for over 5000 years. When any country or empire abuse their fiat currency (paper money that is not backed by precious metals) the value of fiat currencies eventually returns to zero!!!!! This had happened many times in history including Germany between the world wards and Zimbabwe today. The US dollar has lost 80% of it's value since the 1930's! Since 250 BC when the Athenians diluted their gold and silver coins with copper and zinc, thus doubling their money supply overnight to pay for a war (how history repeats itself!) they initially experienced a boom then hyperinflation that eventually lead to bust and the collapse of empire. Sadly that's where the West is headed. Gold and silver in times of economic calamity not only increase in value (even during hyper inflation) but overshoot it. One of safest options to get through the forthcoming economic tsunami is the physical purchase of gold and silver. Thousands of years of history stands testament to this fact. Micheal Maloney's brilliant book Investing in gold and silver is a must read on the subject.

  18. Bruce | October 6, 2011

    Doobs, you are dead on. Bernanke says what he is told by Goldman Sachs via the treasury Secretary who works for GS. In the meantime i've parked my meager pension; Waitin' on the sidelines with 'cash after crash' . Mind you, RIM is tempting. Ask GS when they've scheduled that takeover? Then post it, will ya?

  19. dale | October 6, 2011

    the etf funds have no metal ? and the jr minning stocks beter be in the usa or what ever place that u live in , all counterys will nationalize there mines , jr minning stocks are so under valued that when we go to the silver and gold standard again the gov will take then over and even then u may still not get any thing out of it ,
    iShares Silver Trust (NYSE: SLV). is a farse, and dont have what they say they have and is a jpm scam

  20. hmk | October 6, 2011

    Precious metals will go up if we experience inflation or stagflation. However, think about this: Japan has been in a deflationary enviroment for 20 plus years and has the highest debt to GDP ratio in the industrialized world. Their govt has been trying to create inflation but can't because they are in a deleveraging cycle induced by their debt fueled real estate bubble in the late 80s.. Europe and the USA's economic problems are also as a result of unsustainable debt levels. The typical end result is a debt liquidation crisis which is deflationary and brings the prices of everything down including precious metals. Remember 2008, gold, silver, oil etc crashed. This scenarion doesn't even include China which has the largest real estate bubble in human history. I think the more likely outcome is a debt liquidating depression in which the only thing with value is cash. What follows this event is then likely to produce inflation depending on what the idiots is power decide to do. FYI, look at what treasuries have been doing lately- their yields keep going down- telegraphing deflation.

  21. pepe | October 6, 2011

    according to a recent info from wlkileaks,the united states and the european countries have manipulated the recent distress of gold price because they are alarmed that if the gold standard will be revived,it will be catastrophic to their dollars and euros as the leading currencies of the world.granting that it is true,the question is for how long?definitely,the current low price of this precious metal presents a very unique opportunity for investors and ordinary folks.

  22. Ron | October 6, 2011

    Around June of 2012 China is going to open a full buying market for gold and silver, its part of there 5 year plan to take over the world,s money. If this information is true what do you think will happen to gold and silver prices, my guess is that China will take over the gold and silver buying market from the USA and UK. I would strongly suggest that you get your silver and gold now while the prices are low, even if you buy junk silver coins for melt. This opertunity will NEVER come around agin in the next 1000 years, because the world has never come to this point before. Gold and silver will back money and be traded for goods in a few years, no one in the world is going to want paper money that is not backed buy this metal. These two metals will be around for ever from now on, so get in on it now because this will never happen a gain a total melt down of the worlds money.

  23. briya | October 6, 2011

    One thing i don't get is that if a recession/depression does come than wouldn't industrialization slow down and thus price of silver. As mentioned silvers main use is in the industry.
    Can any1 explain???

  24. Ron | October 6, 2011

    I belive that the day will come where a coin made of 98% silver or a % of gold the size of a USA dime will have a face value of 20 bucks or 50 bucks, and when people in the USA go to the store they will be buying food with these small coins instead of paper money, same goes it with a 100 buck coin, and so on, maybe thats a big change in the way money spent on dayly basis but the world as of today has totaly melted down and heading down deeper every day with no repair plan in the works, even with coins with value it would create millions of jobs all over the world, everything from truck drivers to people handling the coins in bulk. Shifting around money in paper form and computers have killed millions of jobs all over the world, a solid coin for trade all over the world would would create jobs in a years time. The USA mint alone creates hundreds of jobs with coin produceing from the blanks to the finished product, personly i belive that a machine shop with 1000 people making blanks, and sending them to another shop so to be stamped of a 1000 workers and times that to the whole world and all the workers connected to those coins. It would do the world good. Hard money can put the whole world to work AGAIN.

  25. Ron | October 6, 2011

    With hard money as real money with a value in coin form the stock market would boom all over the world, from companys that make big machines to dig it out of the ground to the companys that make machines to make the coins to companys that would refine the metals to companys that handle the computer tracking work, the list is endless for the benifits of a hard currancy again, and don,t foreget that most all countrys in the world have gold and silver that can be mined, so those company stocks would go up also. Hard money would save this world from the disaster its taking right now, it would take some doing to create this hard money program but the benifits would be huge for many years down the road.

  26. Carlos Paulino | October 6, 2011

    I want to see the gold diggers here try going to a pawn shop and cash in their gold. You really think you gonna get the Bloomberg posted value? Try cashing in your Krugerands and see the disdainful look of the buyer in your face. How pure is the gold you fools buy? Do you know if your coins are counterfeit? How do you know your paper gold is backed by real gold? I can't imagine people buying more gold jewelry with the increasing worldwide crime wave. You wear gold and you're a mugger's dream. Gold has more drawbacks than a shopping bag full of Zimbabwe notes. Can you truly sleep at night knowing you invested your future in gold? And Barrick Gold? Well, everywhere they mine they have enviromental controversy with their neighbors, be it cities, township, provinces. They're always in local paper headlines and not for good news.

  27. Steve | October 8, 2011

    I know nothing…and respectfully… so does every one else apparantly know nothing. All we are talking about is how to gamble … What is a good horse to bet on… Folks remeber the physical the law of probablity: Anything can happen and will… We know nothing! Nothing! As Cramer is fond of saying…

    Realizzzze please that simply being brought into creation here with the gift of this life.. you have beaten greater odds then the human mind can even comprehend… enjoy your time on Earth… prepare your soul, best you can, for the afterworld… that is where your future lies… where your wealth might accrue, if ever it will.

    Having come into material creation on Earth…and given to be witness to all of creation… we are given the incredible chance to become a part of, to connect our soul, our intellect, our feelings, with the great unknown and all that lies beyond… don't blow your opportunity…

    The worlds economys have been a great big con game…there really is no intrinsic value in anything Earthly… nothing can be taken with you but your soul..as John Lennon aptly pointed out, as he often raged against, or sought to comfort, humankind in his songs an effort to reel in the madness of the world he witnessed daily and all about. You can't take nothing with you but your soul.. rememberr that my friends.

    Financial investments are merely elegant ways of prolonging our Earthly miseries…in the hope that our salvation will come as we tread upon this Earth, which it will not.. it did not for Steve jobs, as we now see, nor will it for Gates, Buffet. (All you can Eat) the Pope…(buck a prayer please.. weekly specials) Osama or Obama… not even for Hugh Heffner! (Well maybe it did for Hugh Heffner!)

    Have faith humans in our eternal salvation as the lord of all creation above the material sphere awaits us… wanting only to raise to a higher plateau of knowledge and being in the existence of all creation.

    . Unless your a rare individual that has a true expertise or knowledge in some one thing or another… and has 'money' (the means) to grow your endeavor… you ought to be busy seeking your souls salvation … Amen

  28. Daphne | October 9, 2011

    Dear Carlos – you do ramble on a bit! You seem angry at the individuals who have chosen to trust gold as a part of their investment! If one purchases a known format, such as Krugerands, directly from a reputable dealer, there is little risk. I know, as we purchased a number of the coins back in the late 1970's, and stopped buying just as gold hi $300 and ounce. Two and a half years later, when my husband was unemployed, we had no difficulty cashing in those coins at $800 and ounce, so we could pay our mortgage. No other investment, so easily portable and so easily converted, would have given us that profit margin. It 's true one needs to be cautious, but I stand by gold as "insurance" as another commenter stated.

  29. Ike, Guenter | October 9, 2011

    With your possible target for silver by Dollar 150 per ounce I cannot agree. Keep in mind that the silver price with Dollar 50 per ounce in January 1980 was based on a corner by brothers Hunt.
    Is it unfair to ask which exchange rate for the dollar against the Swiss Franc or the Euro is calculated by your estimation? Thanks for the answer.

  30. John Kish | October 11, 2011

    You are saying GLD and SLV etf's are worthless investments, and you say physical gold and silver is the way to go. Your info on gold and silver mines is not clear. Give me facts and if you feel physical gold and silver is what you should own where is the best, honest place to buy it?
    John Kish

  31. John Kish | October 11, 2011

    Where is the best, honest place to buy physical gold and silver and should I sell all my etf's.

    John Kish

  32. Ted Yeomans | October 18, 2011

    The average investor must be totally confused by the multitude of advice (good or bad) given by so-called experts in the financial world. I have come to the conclusion that very little advice can be trusted as the WHOLE TRUTH and the ONLY TRUTH. It must be common knowledge that Bay Street (Canada) and Wall Street (USA) financiers control the World Market. We. the little investors, are just sitting ducks for them to pluck at their pleasure. Will our governments come to this realization before there is a world-wide uprising against these unfair financial tactics against the general public. It is easy for government members to turn a blind eye to what is going on as they depend upon this financial hierarchy to keep them in power. The world-wide uprisings (protests) are indications that the average public will not tolerate this unfairness any longer. Hopefully, these protests can bring about change before there is total chaos in the world.

  33. SAM GRECO IV | October 19, 2011

    i bought 90% of my gold @ $300 per ounce, i would go to a reputable merchant in texas, that was selling
    1 oz. coins at spot or a fraction above spot. this would cost $900. for 3 ounces i would have enough left over to buy 8-9
    ounces of silver reaching the $1000 mark so i would not have to pay the $82.50 in sales tax. confused now
    is an under statement. 50% say sell,50% say hold. at $1500-$1600 per oz. i come out great. does anyone
    know when to get out? what number do i cash in? what number for silver?

  34. colin adese | March 14, 2012

    Am right behind you and several other experts in the field and even by some miracle accounting hatched by those with an interest to do so might leave us perplexed for a while longer i still awake each morning to the sun reflecting onto my recent delivery of 5 X 5 kilo bars of silver (+800 ounces).

    PS I am no expert on this, however, i believe, those pesky oil contracts between OPEC, others and the oil fraternity are usually fixed a year or more in advance. From tanker sailing away from say nigeria, docking in port in US, shunted off to refinery, lorries loaded and oil frat delivered to pump!!!Question? How come the pump price outperforms even the dodgy oil futures price before your tank is full.

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