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Gold

Despite Record Gold Prices, Your Holdings May be Worth Less Than You Think

Record gold prices are becoming an almost-daily headline, with the "yellow metal" making a run at $1,400 an ounce. And while this is great for the investors who are along for the ride, there is an important caveat - your gold may not be worth as much as you think it is.

Moreover, because of the tax consequences of ownership, chances are it'll never add up to what those guys hawking gold coins on late night TV lead you to believe.

But that doesn't mean you shouldn't invest. With an estimated $202 trillion in unfunded pension liabilities and the global public debt clock ticking higher, I believe gold and other precious metals should be a part of every investor's portfolio.

To find out why your gold may not be worth as much as you think, read on...

Buy, Sell or Hold: Silver Wheaton Corp. (NYSE: SLW) Is Poised to Profit from the White Metal's Rally

Have you ever wanted to invest in a company that owned the supply of a product at a nice fixed rate of cost, but was able to leverage the upside, but not have to take any risk in actually making the product?  How about if it's something inherently dangerous and expensive with bad margins like mining?

In the case of Silver Wheaton Corp. (NYSE: SLW) we have a very interesting investment vehicle, because the company does not have to take additional risks to grow its production numbers.  Silver Wheaton owns the rights to silver production from mines that produce it as a bi-product.  This allows the company to enjoy a growing supply curve, while protecting its balance sheet.

It has already purchased these rights upfront for cash, helping some miners with their capital costs to open a new mine.  As these mines ramp up production in whatever primary product they are producing, Silver Wheaton gets access to the silver produced as a bi-product.

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As QE2 Looms, Is the Fed Focusing on the Wrong Things?

U.S. Federal Reserve Chairman Ben S. Bernanke is looking forward to 1932.

That's not a misprint. Actually, Bernanke is looking forward to a point when the challenges facing today's U.S. economy mirror the problems of that particular Great Depression-era year. And he wants that to happen for a very simple reason.

He knows how to solve those problems.

Unfortunately, "1932" isn't likely to arrive. And the preparations the Fed is making in the meantime are likely to deepen the United States' economic woes.

Let me show you what I mean...

To see where the central bank has gone wrong, please read on...

QE2: How New Quantitative Easing Will Launch Emerging-Market Stocks

 In Wall Street circles, it's known as "QE2" - for "Quantitative Easing - Round 2."

The U.S. Federal Reserve and the Bank of England (BOE) are moving rapidly towards it, and the Bank of Japan (BOJ) has pledged to enact it.

That Bank of Japan pledge ignited a $23.50 spike in the price of gold on Tuesday. But that's nothing compared to what would happen after a Fed move. An additional easing by the U.S. central bank would cause gold and commodity prices to spike - and emerging-market stock markets to soar.

We should be prepared for this eventuality.

To see how you can profit from "QE2," please read on...

With Prices Soaring Gold Bullion is Suddenly in High Demand

The world's wealthiest people are moving their money out of stocks and into gold bullion, sucking the yellow metal up by the ton in some instances.

Fears that the dollar will continue to lose value in the wake of the U.S. Federal Reserve's quantitative easing have boosted the appetite for physical bullion as well as for mining company shares and exchange-traded funds (ETFs), UBS AG (NYSE: UBS) executive Josef Stadler told the Reuters Global Private Banking Summit.

"They don't only buy ETFs or futures; they buy physical gold," said Stadler, who runs the Swiss bank's services for clients with assets of at least $50 million to invest. "We had a clear example of a couple buying over a ton of gold ... and carrying it to another place," Stadler said.

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Question of the Week: With Gold Prices Soaring Investors Are Cashing In

Gold prices have continued their record-breaking climb, and are showing no signs of stopping.

Industry analysts and bankers met at the London Bullion Market Association conference in Berlin last week - the biggest gold industry gathering - and predicted gold would hit $1,450 an ounce next year, a 12.5% climb from its current price of around $1,300. The LBMA's predictions have a strong track record, and in recent years often fall just shy of actual prices.

Gold is up almost 20% this year, and having this week topped $1,340 an ounce.

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Buy, Sell or Hold: As Gold Sets New Records, Ride Along With Yamana Gold Inc. (NYSE: AUY)

As of Friday, gold was trading above $1,300 per ounce for the fourth consecutive day, which means the break out in the price of gold in U.S. dollars is still going strong. Gold prices are setting nominal new highs regularly, but are still actually below their record high if adjusted for inflation.

I love this kind of a sweet spot in a bull market move. You know that it's blue skies in nominal terms, but you also know that you are not yet being too greedy. That is, the upswing is still within the limits of the market's last bullish move.

This would be like buying a stock that is trading significantly below its all-time high price, but with better fundamentals.

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Money Morning Mailbag: Don't Bank on a Return to the Gold Standard

Gold prices closed above $1,300 an ounce for the third straight day yesterday (Thursday), continuing a record run that's delighted gold bugs everywhere.

The surge shows just how much confidence investors have lost in fiat money, and greater appreciation for what former U.S. Federal Reserve Chairman Alan Greenspan last month called the "ultimate means of payment."

Gold's price surge "is a signal that there is a problem with respect to currency markets globally," Greenspan told the Council on Foreign Relations.

Indeed, Money Morning has repeatedly warned readers about the pitfalls of paper currency. However, it's unlikely that readers hoping for a return to the gold standard will get their wish.

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We Want to Hear From You: Is a Gold Price of $5,000 an Ounce Attainable?

The gold price continues its record-breaking climb, and shows few signs of stopping. Industry analysts and bankers met at the London Bullion Market Association conference in Berlin this week – the biggest gold industry gathering – and predicted gold would hit $1,450 an ounce next year, a 12.5% climb from its current price of around […]

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Silver is Emerging From Under Gold's Shadow

Gold surged to an all-time record high of $1,298 an ounce yesterday (Wednesday) after a U.S. Federal Reserve plan to jump-start the American economy triggered a slump in the U.S. dollar.

The yellow metal has now rallied for five straight trading sessions and is up about 18% for the year. Investors are waking up to the fact that the central bank's plan to use U.S. Treasury purchases as a means of injecting another $2.3 trillion into the U.S. economy is only going to further debase the greenback.

There's no doubt that the ongoing slide in the dollar is going to be bullish for gold. But investors will do a lot better to focus on silver - the "other" precious metal.

"People are finally starting to understand that quantitative easing will devalue the currency," Gijsbert Groenewegen, a partner at Gold Arrow Capital Management in New York, told Bloomberg News. "That's why they're shifting into gold and silver."

For six ways to profit from silver, please read on...

Don't Get Bullied out of Bonds

Bonds have provided a welcome safe-haven for investors seeking shelter from the financial maelstrom of the past two years, offering steady returns while stocks bounce up and down.

Now some analysts are afraid that once the selling of bonds begins it will be indiscriminate, and there will be a bloodbath. But that fear totally ignores the new investment reality in which we're living.

The fact is, stocks won't be crawling out of the gutter anytime soon, and until they do, investors will continue to look elsewhere for a store of value. They have already decided they can find it in two places: U.S. bonds and gold.

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Prosperity Piquing Investor Interest in India

In the investment world, there's often so much talk about China in the United States that the tremendous success in India gets short shrift. But business there is booming.

The world's third-fastest growing economy is set to expand by 8.5% this year, the most in the past half-decade. Such rapid growth has compelled the central bank to lift interest rates four times in the past six months.

Compare that with the U.S. Federal Reserve, which has made clear it intends to keep rates low through at least the middle of next year due to limp demand and negligible inflation.

While American consumers are burdened by high levels of debt and joblessness, India's urban middle class and farmers - who have enjoyed a year of ample but not over-abundant rainfall and rising prices - are eager to spend their newfound wealth.

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Three Ways to Brace for a Double-Dip Recession

Economists are torn... Is the U.S. economy on the upswing? Or are we facing the dreaded "double dip recession"? Either way, there are a few things every smart investor needs to do now to protect their nest eggs. Find out what you should do in this free report.

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Special Report: How to Buy Silver

As precious metals go, silver may not have quite the same mystique as gold.

But let's be honest: The "white metal" has its backers, too.

In fact, when Money Morning published its "How to Buy Gold" special report just a few weeks ago, one of the biggest questions that we received in response was: "When can you do the same for silver?"

That's just what we've done here. In this special report, we show you how to buy silver.

To find out how to buy silver, please read on...

Gold Will Shine No Matter What the U.S. Economy Does

More analysts and investors are increasing their bets on gold with some forecasters saying the rally in the yellow metal will continue no matter what happens with the U.S. economy.

"Either a swift economic recovery or further dismal economic performance should bring new buyers into the market," Eugen Weinberg, an analyst at Commerzbank AG in Frankfurt who expects gold to rise as high as $1,400 next year, told Bloomberg News. "A stronger economy would create more jewelry demand. If the economy stays weak or gets worse, then investors will be looking for a safe haven."

Gold will continue its longest rally in at least nine decades and may rise as high as $1,500 next year, about 21% higher than current levels.

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