Gold, Silver and Other PMs

http://www2.marketwatch.com/news/yhoo/st...

Top 92. Nov 28, 2000 5:27 AM

» FCSTECKIII - What's this? Gold going up?

Make no mistake. Anyone even suggesting that Gold
should be part of someone's investment portfolio
must be nuts. Right? Well, I'm not so sure ...

Without a doubt, Gold and other PM's have been
in a Bear Market now for 20-years. Those who
jumped on the band-wagon in 1980 and purchased
Gold near its $800 peak level have seen their
'investment' dwindle down to the current price
of $270. Talk about a Secular Bear Market ...

Interesting thing back in the late `70's and
early `80's is that most people thought that
inflation was here to stay. We almost got use
to the idea of 12 and 13 percent mortgage rates.
Inflation was so bad that $3.00 couldn't even
buy $2.00 ...

My how things have changed. Productivity, coupled
with a shrewd Federal Reserve Chairman, has
essentially left us now believing that inflation
is gone forever. A complete reversal of the way
we thought about inflation 20-years ago ...

So am I now suggesting that everyone should go
out and abandon stocks and load up on Gold and
other Precious Metals? Absolutely not! However,
do I believe that Gold is an asset class just
like stocks, bonds, or cash and has a place in
one's overall investment strategy? In a word,
yes ...

Political uncertainty and a weak U.S. Dollar are
the perfect catalysts for an increase in the POG.
Lately, we've been witness to some political
uncertainty which has caused the price of Gold to
move up some. IMHO, this political uncertainty
will be short lived however. It does leave me
thinking that if Bozos in the white house can
cause a spike in the Precious Metal, what would
news of say Alan Greenspan's retirement do to the
POG? I know, I'm speculating but it does leave me
wondering ...

Here's an interesting article from CBS Market
Watch on Gold and other Precious Metals:

-Thanks

-- posted by FCSTECKIII

http://www.silverinstitute.org/news/pr11...

Top 93. Nov 28, 2000 2:49 PM

» Whirlwind - Re: What's this? Gold going up?

In response to message posted by FCSTECKIII:

The US government announces that they will ship the remaining 15 million ounces of silver from their stategic suply to the US mint. Given the present demand for freshly minted US silver coins, by the end of next year, the US will become a net buyer of silver for all silver needs thereafter. This is wildly bullish for silver and I expect a major move in silver soon, my guess is May or June of next year.

-- posted by Whirlwind

Top 94. Nov 29, 2000 4:39 AM

» FCSTECKIII - Re: Re: What's this? Gold going up?

In response to message posted by Whirlwind:

I haven't heard anything to the contrary, but I
believe that Warren Buffet still holds 25% of all
'above ground' silver. His average purchase price
was less than $5.00 (right near where it is today)

To be honest, I have no idea where Silver or Gold
will be next year. What is interesting is that
there has been minor advances in some of the
middle tier Mining Companies like:

Homestake Mining (HM:NYSE)
Newmont Mining (NEM:NYSE)
Placer Dome (PDG:NYSE)

These advances do not appear to be the usual short
covering like what occurred last year, but are
more concentrated to a few select companies ...

Normally when there is short covering, we witness
huge spikes up across the board (small, middle,
and large Mining Companies) like we saw last fall.

I'm sure that the Presidential Election Debacle
has contributed to these short spikes, however,
more importantly, rumors of a 'hard landing' are
now in the air which may be the reason we've seen
some advancement in these Mining Companies ...

I would hope that Alan Greenspan would lower short
term interest rates long before the economy were
to go into a recession. Would like to hear from
other members of the board and get their opinions
of where our economy is headed ...

-Thanks

-- posted by FCSTECKIII

Top 95. Nov 29, 2000 5:03 AM

» Whirlwind - Re: Re: Re: What's this? Gold going up?

In response to message posted by FCSTECKIII:

My guess is that Buffett leased or sold all of his silver. The ever dropping price of silver and the huge increase in COMEX stocks seem to suggest some large supply of silver has worked its way into the market in the last year or so.

Agree that the Fed needs to act here and soon.

-- posted by Whirlwind

Top 96. Nov 29, 2000 5:48 AM

» Rande - Re: Re: Re: What's this? Gold going up?

In response to message posted by FCSTECKIII:

POG still below cost to produce, isn't it? Disinflationary signal in the extreme. Combined with the FIG and general signs of slowing in the actual economic data, Greenspan may be getting behind the DISinflation curve. Hopefully, he'll act before DEflation becomes an issue. Protecting the inegrity and purchasing power of the dollar works BOTH ways.

-- posted by Rande

Top 97. Nov 29, 2000 6:21 AM

» FCSTECKIII - Re: Re: Re: Re: What's this? Gold going up?

In response to message posted by Rande:

Appreciate your reply Rande ...

Over the years, many of the middle and large
mining companies were forced to re-tool their
mining operations just to stay 'alive'. Some
of these companies can now make a profit even
if Gold drops to the $250 level ...

My hopes are that AG takes action with regards
to interest rates. Based on the 2.4% GDP number
this morning, how much longer will he wait before
easing rates?

-Thanks

-- posted by FCSTECKIII

Top 98. Nov 29, 2000 12:06 PM

» Kirk - Re: how much longer?

In response to message posted by FCSTECKIII:

Based on the 2.4% GDP number this morning, how much longer will he wait before easing rates?

I heard today on TV (consider the source!) that the GDP has already gone higher than that rate and is in the 3's now. It might be a short term spike downward or signs of a real problem. One thing for sure, this spender is not spending as I was in the Spring with the wealth effect that I had then. Nice to get some new windsurfing sails and big power tools out of some profit taking dollars! (not ALL of it went to investing... some came out for spending!)

I don't think there is any reason Greenspan has to wait for a scheduled meeting to lower rates should something come out of left field. I'd also suggest looking back through our ECRI thread at the FIG charts... I think AG wants to see the FIG a bit lower before he starts lowering.

-- posted by Kirk

Top 99. Nov 29, 2000 12:20 PM

» Rande - POG update:

POG update:

3:14 pm ET DEC. GOLD CLOSES DOWN $3.40 TO $266.40/OZ.

Also -- Dec. Silver down a little over .08 to 4.615.

"Strong dollar" is the glib soundbite. Meanwhile, oil's moving in the wrong direction. Still believe, all other things being equal, Greenspan and Co. would like to see oil get back under $30. Certainly not the only factor in town, but a significant one nonetheless.

-- posted by Rande

Top 100. Nov 29, 2000 1:52 PM

» dewam - production is cheap, maybe too cheap!

The major mines that have opened have production costs below the current price of gold, but they have more dependency on their futures contracts, than on the current price of gold. One interesting thing happening around here is the companies are having to devise "poison pills". The current price of gold, and the established reserves, are making them look very interesting as takeover targets. You can currently buy companies below the value of their established reserves. Den

-- posted by dewam