-- Posted Wednesday, 14 December 2005 | Digg This Article
Well, I think we can say with confidence now that gold has definitely “arrived.” And what do we mean when we use the word “arrive?” The Kitco graph below should tell it all.
And as we continue to really try & stress these are not short term prices, but the start of a new trading range that will ultimately climb ever higher – A LOT HIGHER!
Right across from my favorite coffee tavern is a cigar shop called Halfway to Habana. An Italian, Paolo, is the proprietor. Been in the tobacco business over 22 years. Paolo started his tobacco career in Columbia working his way eventually to Greenville. I like visiting his shop. Though I do not smoke I love the smell of pipe tobacco &/or a good expensive cigar. Interesting curios in his shop. I guess the most interesting items he sells are cigars for dogs. Called chewgars. Yes, dogs can be taught to smoke much to the dismay of the anti tobacco league.
“Celebrities, industry leaders, politicians, sophisticated women and men dogs are seen after dinner and other special occasions enjoying luxury Chewgars.” http://www.chewgars.com/
Well, as gold climbs ever higher marking 24 year highs there are still those reluctant investors continuing to remain on the sidelines until CNN gives them permission to buy. You don’t believe me? Read the following email below from a reader.
“Sorry not yet, guys…waiting for the AOK from CNN.”
J.
Ottawa, Canada
J, you are going to miss the boat (a very big boat) waiting for CNN!
Basically, what the reader is stating is that he is waiting for the “herd” to move before he himself jumps in. I read a lot & one interesting characteristic I continue to read about those individuals who attain any measure of success is there ability always to think for them selves & to often strike out in a direction their friends & neighbors believe to be foolish. Ever heard of a fellow by the name of Philip Anschutz? Interesting rags to riches story.
The self made billionaire, Philip Anschutz, has an interesting comment on what personal decision led him on the road to his considerable financial success.
“Anschutz says he was a mediocre student until he realized that to make positive changes in his life he was going to have to do it himself. “I came to understand that to be successful you have to get off the bench and onto the field. You cannot be jus t an observer; you must become an active participant. ” “When you grow up on the edge of financial chaos it does several things to you,” he says. “It makes you strive harder to not only achieve success, but to achieve normalcy in your life. ” “http://www.horatioalger.com/members/member_info.cfm?memberid=ans00
I like those comments above as it describes those still sitting on the side line waiting for some one (CNN?) to come forward & hold their hand. Got a quick word here to tell you & that is that no one is going to come forward to take you by the hand to help you “to achieve (the financial) normalcy” you so very much desire in your personal life. What else does the very successful Philip Anschutz have to tell us?
“You have to understand how to take advantage of an opportunity when it comes along…” “By that I mean that you have to have enough experience to recognize it, enough preparation to take advantage of it, and enough courage to act on it. You have to be a risk taker and have the constitution to be able to deal with the risks you take. You have to be a hard worker, and, last of all, you have to be persistent. ”
I like what this man has to say so let’s read some more below what he has to share with us.
“It was his philosophy that he had to have a lot of things going on because not everything would work out. At one point he drilled 30 dry holes in a row, causing banks to occasionally cut off his credit. Undaunted, Anschutz exercised patience and persevered. “You have to have the ability not to give up or lose confidence in what you are trying to do just because it doesn’t work out the first time you try it. You may have to go back and try again, and again, and again. Persistence is one quality you need throughout life, and not only in business. I have seldom achieved anything worthwhile the first time I attempted it. It is only by sticking to an objective through adversity that a goal can ever be realized.”
Can we apply the advice we just read above to gold mining stocks? Yes!
Many new investors will ignorantly invest in one single mining stock hoping that one stock will go to the moon & make them rich. The most respected & competent commentators & analysts will ALWAYS recommend the purchase of at least a minimum of six different companies to maximize the risk/reward ratio.
I know we are spending a lot of time here on what this fellow has to say but this is good stuff. Read the following below.
“Anschutz even says that much of his success is due to the adversity he had in his life. “Adversity is a great thing, “ he says. “Without it you are never challenged to be creative, to improve yourself. You never know for sure what you can do until you are put in an adversarial position. Overcoming adversity in your life is the best way to develop a skill set that you’ll use again and again.”
Anyway, opportunity always only beckons to those who are brave & courageous. But what does this man attribute his greatest success to be?
“And I am grateful to my wife, Nancy, who has been my partner for 32 years. Together we have raised three children. They have all been so supportive of me.” “Commit to your family and family values.”
Wow! Hear that talk about family values? Sounds like the fellow may be a Christian!
“It’s not failure, but the fear of failure that stops most people.”
And back to gold below.
“Gold prices are likely to remain strong in the near term as the metal is getting tremendous support from investment funds and fundamental factors such as slow growth in mine output, analysts said on Thursday.” “Gold demand was seen surpassing mine supply and the move to develop new mining ventures had been slow despite prices surging to their highest level in more than 24 years, as production costs had sharply risen.” "At the moment, gold is clearly very much in favor. Gold is now rallying in all currencies," he told a gold investment summit organized by Euromoney Seminars.” “He said gold prices were expected to continue to rise in 2006 and it was not impossible to see gold spiking to $850 an ounce in 12 to 18 months. Physical markets have also been supporting the price rise, he said.”
http://today.reuters.com/news/newsArticle.aspx?type=businessNews&storyID=2005-12-08T184534Z_01_BAU866778_RTRUKOC_0_US-MARKETS-GOLD.xml
Uh, oh!
Did you just read the text above? Something about gold getting “tremendous support from investment funds?” These fund managers must not be getting their analysis from CNN. Maybe these fund managers doing all this buying know something we don’t? Maybe they know something CNN doesn’t know?
The following interesting email comment below is from a Canadian reader.
Dear Mr. Vaughn,
Thanks for another enlightening letter. I could not disagree with a single paragraph and would like to offer a family example of what governments can do to hard-working, savings minded citizens: About a hundred years ago my grandfather was a farmer in Germany. (I am 76 now) Asparagus was just coming on the scene & became a culinary fad. He pioneered growing it on a large scale and contracted with a cannery to buy all his production. The white variety preferred by Europeans takes more hard work, but he did not mind, because the money was very good. He did this for about twenty years and was paid in rolls of Gold coins, which he then - you guessed it - deposited in a bank. In exchange he received a receipt and an entry in a ledger. In the early 1920s he saw his very substantial retirement nest egg, built up over about twenty years disappear within a short time. The reward for all that hard work would now buy him a few loaves of bread.
A Canadian Reader in Calgary, Canada
I guess the moral to the message above is to NOT store your gold in the local bank safe deposit box. Everyone is predicting gold to continue climbing – except CNN of course.
“Global investment funds, their appetite for commodities seemingly insatiable and their passion for stocks and bonds on the wane, pushed the price of gold to fresh quarter century peaks overnight.” "Momentum traders will not want to sell -- if this month's trajectory continues then gold will be at $568 by year-end and $649 by the end of February," Merrick said.” http://afr.com/articles/2005/12/09/1133829748138.html
Wow! Now the following below I did not know.
“The word Christmas is a contraction of Christ's Mass, derived from the Old English Cristes mæsse and refering to the religious ceremony of mass.”
http://en.wikipedia.org/wiki/Christmas
And, lo, the angel of the Lord came upon them, and the glory of the Lord shone round about them: and they were sore afraid. And the angel said unto them, Fear not: for, behold, I bring you good tidings of great joy, which shall be to all people. For unto you is born this day in the city of David a Savior, which is Christ the Lord. And this shall be a sign unto you; Ye shall find the babe wrapped in swaddling clothes, lying in a manger. And suddenly there was with the angel a multitude of the heavenly host praising God, and saying, Glory to God in the highest, and on earth peace, good will toward men.
Why gold stocks?
Because you can make a lot of money. Gold Letter (us) first recommended our subscribers to Virginia Gold (VIA.TO) in the spring of 2003 when the stock was just .54. Now Virginia Gold is at $10.60 as of 12-9-2005. So if you had invested $10,000 when we first recommended Virginia Gold your 10 grand would be worth right under $200,000. Might pay for that kid’s college education or a new house.
Also, Gold Letter recommended U.S. Gold (USGL.OB) at .54 just close to 5 months ago in August 2005. And to our knowledge we were the ONLY newsletter recommending U.S. Gold when we did at this cheap price. Today, 12-9-2005, U.S. Gold is at $3.55. $10,000 invested just 5 months ago in U.S. Gold would now be worth close to $66,000. Might just buy a new car for that sum or treat your kids to a new pair of shoes.
“Gold fever took prices as high as $530.40 an ounce for the first time in nearly a quarter of a century on Friday as investors, particularly in Asia, rushed to buy an asset that has gained over 16 percent in the past month.” “Gold's tight supply, strong global demand, worries about inflation and growing fund interest in precious metals and other commodities have unleashed a wave of speculative buying, defying warnings that the market was overbought.” "The activity in the bullion market remains very impressive, with aggressive buying of any dips and a dearth of selling in the rallies helping to create a bullish chart pattern of higher lows and higher highs, thereby attracting more momentum-based fund buying," Alan Williamson of HSBC said.” “Fund managers were buying as part of a strategy to diversify portfolios, while some investors were speculating about potential purchases from some of the word's central banks -- previously long-time sellers.” “In November Russia, Argentina and South Africa expressed interest in increasing their gold holdings, even though European central banks have sold more than 100 tonnes since September.” http://today.reuters.com/News/newsArticle.aspx?type=businessNews&storyID=2005-12-09T162933Z_01_KRA919298_RTRUKOC_0_US-MARKETS-PRECIOUS.xml
And how is gold doing as of last weekend?
Let’s look at that renowned & legendary graph from those gold experts at Kitco again & find out. As you can invariably see from the picture below the gold cartel forces have definitely finally & conclusively lost control of controlling the gold price. Gold is now in the hands of the people – where it should be.
What we are witnessing at the close of this eventful year, 2005, is “Only the Beginning” of a new era for gold. I know we continue to say this over & over & over & over, but these are the facts as they are presenting themselves to us today.
This market no longer is simply a “game”, but is representative of a real opportunity for astute investors to make a very great deal of money if they simply read the headline news staring us in the face every day. And what am I talking about? Read the investment headline below & figure it out your self.
And what does gold veteran Bill Murphy have to say about the gold price?
“Frank Veneroso confirmed tonight what MIDAS and GATA have been saying for some time. The Gold Cartel has lost control of the gold market. This was also confirmed to us the other day by one of the members who sat on the Board of one of the 12 Fed banks. This Board member has loaded his own boat (big numbers) with physical gold and expects the price to reach $900 to $1,000 within 3 years. This, from a
conservative banker.” “Price prediction: Adam Fleming, former Chairman of Harmony Gold and now Chairman of Wits Gold, said at Gold Rush 21 that he is looking for $3,000 to $5,000 per ounce. I concur.” Bill Murphy, Le Metropole, 12-12-2005
And more gold headlines?
“SINGAPORE (Reuters) - Gold hit its highest level in nearly 25 years in Asia on Monday as fund buying resumed, particularly in Japan, consolidating a rise of more than 20 percent in value since the start of 2005.” “It is not unreasonable to assume we might try $550 and $580.” http://news.yahoo.com/s/nm/20051212/bs_nm/markets_precious_dc_1
Are you yet convinced gold is the new hot investment?
Gold prices ‘could hit $850’
“LONDON: Gold prices are likely to remain strong in the near term as the metal is getting tremendous support from investment funds and fundamental factors such as slow growth in mine output, analysts have said.” “…the yellow metal could even hit $850 by 2007. Gold demand was seen surpassing mine supply and the move to develop new mining ventures had been slow despite prices surging to their highest level in more than 24 years, as production costs had sharply risen.” 12-11-2005,
http://www.gulf--imes.com/site/topics/article.asp?cu_no=2&item_no=64086&version=1&template_id=48&parent_id=28
Before investing in gold stocks it is highly recommended to subscribe to publications that provide a brief review & an introduction to those companies offering excellent speculative potential. Gold Letter emails subscribers those companies it believes are poised to rise dramatically higher as gold continues its upward trek. A Life Time Subscription is now available for a short time only.
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There is no other asset class - historically - other than gold that will make investors particularly affluent. Gold equities definitely represent the best longer term investment class with spectacular potential for leverage today. 
