Did you catch the report put out by Citigroup about gold being in a “super cycle?”

Oh, you did not hear the report mentioned by Maria Bartimoro or Joe Kernen so you ignored it.  Good decision there.   Yes, get all your financial information from the talking heads on TV.  Excellent financial advice.

We talked about this report last week but its overwhelming importance is such that it is worth covering again.

“The resources sector is in the midst of an extended cycle that in turn is part of a "super cycle" which will drive a sustained period of earnings growth and deliver a quality of earnings not seen in the sector before. This situation "outweighs more conventional sell signals that would apply at the maturing stages of a conventional cycle" said Citigroup Smith Barney in a note (261 pages!) to clients earlier this week.” MiningNews.net, 2-2-2005

Let’s slow down & analyze what we are talking about here as this is some of the most important data out yet confirming a long term precious metals bull market.  But first let’s slow down & talk about shoes.

Any of you gone into a shoe store recently to buy a pair of shoes?

Went into this store called “Carnival” something or other today.  Immediately upon walking into this store I am hit with this blaring noise.  Don’t like to really shop & all I wanted were a few pairs of shoes & this outfit was close to home.

But this noise was loud & obnoxious to boot.  Tried to ignore it as I tried on shoes.  Couldn’t ignore it no matter how hard I tried.  Finally after enduring about half an hour of this struggle I gave up & left.  Told the manager on the way out that his choice of store music was not appropriate to a family atmosphere.  A little kid could have learned every tawdry act of sex listening to that stuff.  And this was a chain family shoe store targeting “middle” America? 

But this is 2005 and in my way of reasoning further evidence of the deterioration of our society & standard of living. 

The “middle” class is quietly giving way to a crude “under” class which in the end provides   zero class.  I ended up going into an upper class men’s clothing/shoe store in downtown Greenville to buy shoes.  Ended up paying more than I wanted for shoes but at least I did not exit this store with a splitting head ache.

And this is the world we live in today.  A slow eroding of the middle class where eventually there will only represent two options for consumers.  And those options will be either an inferior “low class” or higher premium class.  And no one else seems to be noticing this middle class slowly disappearing?  But anyway, let’s get back to gold’s “super cycle.”

This is a detailed 261 page report that Citigroup Smith Barney has prepared & put out to inform their clients to begin paying attention to the mining sector.

“In London, the British mining sectors was lifted by positive comments from US broker Citigroup Smith Barney, who said the industry was entering a new "super cycle", driven by higher demand in China.” Finance24.com, 1-2-2005

Maybe if we spell it out in a different language the significance of this report might begin to have an impact on those still asleep.

Mining shares leapt this week after Citigroup Smith Barney suggested the metals and mining sector is entering a new 'super cycle', led by continuing strong demand from China.

Sharecast.com, 2-3-2005

For those with eyes to see & ears to hear all favorable omens are pointing in the direction of gold as the long term investment to be in.

“If you want to make money, invest like an insider, on the basis of private information and direct, personal experience (though not necessarily your own).  Merely putting your money at play with the rest of the lumpeninvestoriat, on the other hand, will give you no greater gains than anyone else.”  Bill Bonner, 2-10-2005

The following comes from another astute commentator worth paying attention to.

“At its very core, speculation is an internal emotional struggle, not an external battle against the markets.”  Adam Hamilton, Le Metropole, 2-4-2005

Let me add here that if you cannot afford to lose what you are investing you do not need to be in this market period.  Also, if you are a novice & averaging less than $100,000 per year from your trading activities you need to be trading via a professional brokerage service very familiar with the resource & gold markets.

What else does the respected Adam Hamilton have to say?

“…we must trade without emotion.  Successful speculators trade on cold, hard logic & probability theory.  Since emotions kill objectivity, they are ruthlessly suppressed by elite traders.” Adam Hamilton, Le Metropole, 2-4-2005

And let’s close by examining what Adam Hamilton believes to be the sincere facts about this gold market.

“The bottom line is the ongoing gold stock bull continues to look quite healthy technically.  We have experienced a correction in the last couple months or so, but such events are totally normal & expected in bull markets.”  “Speculators must overcome the tyranny of the immediate that dominates our minds & emotions.” Adam Hamilton, Le Metropole, 2-4-2005

Again, let us repeat here that if you cannot take the heat then please do yourself a favor & get out of the fire.  In no way should it be a source of embarrassment that only a small handful of investors really have the courage & stamina to invest & make a lot of money.  Success really belongs only to a handful & a minority of investors & if you do not have the stomach to ride out the cyclical downturns then please exit this market immediately.

One more note on shoes. 

Believe it or not I discovered a shoe still manufactured in the good ole’ US of A.  “H. S. Trask” shoes manufactured I think out in Montana some where & made of American Bison Leather.  That’s “buffalo.”  First company to use the leather from buffalo to make shoes.  And, yes, they are extremely comfortable.  Bought two pairs & they were even moderately priced. 

Good to find something of quality still made in the U.S.

And what can we recommend for those brave & wise souls who are paying attention to folks like market guru & financial expert, Jim Rogers?  Jim Rogers is shouting from the rooftops & preaching that we are at the beginning of a very substantial long term bull market in commodities.  And gold is one of these commodities Jim is predicting will grow in demand & do quite well over the coming years. 

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