-- Posted Wednesday, 21 September 2005 | Digg This Article
Your going to love this statistic – when gold prices advanced from approximately US$100 to $865 per ounce during 1976 to 1980 it was estimated that only 1 in 100 brokerage firms recommended gold stocks to their clients. Do you know how many people missed out making 10, 20, or even 30 times their money!! Gold is now making 17-year highs and very few are paying attention. This is great because markets climb a wall of worry. Gold is going to move much higher over the next 24 months and it’s a simple fundamental you learn about in almost all trading books: SUPPLY VERSUS DEMAND. For more than 15 years physical demand has been exceeding production. Take this powerful fundamental and incorporate the reality that a tremendous amount of money has been printed from various governments around the world and you have a recipe for capital gains, or lets say getting yourself set up for retirement!
Looking at only the growth of the US money supply, it expanded over $2 trillion in the past 5 years alone. Many, many times faster than the production of gold. There is a massive amount of capital to chase a limited commodity.
I believe as money continues to role into precious metals, we are going to see gold prices gravitate from the $450 area towards US$600, then eventually $800 to $1250oz. This will ignite a tremendous wave of capital inflows toward the exploration companies. Are you positioned yet?
At gold’s peak in 1980, companies with a few good exploration properties would have likely traded up to $10 per share. Today, we have much more money in the world and many more people investing in the stock market. This will likely result in better performance of gold stocks compared to the 70’s and 80’s. Large cap mining stocks are climbing right now, and the smaller exploration stocks are right around the corner. When they rise, you can usually get many times the leverage.
You may look at Linux now at the 15-cent level and say what a bore, but once gold takes out $500 then $600 an ounce, you’ll be real glad you got in ahead of the crowd. To look at history, Linux rose over 1000% on significant volume during 2001 to 2004 (.03-.46) and this was without the addition of their China and Alaskan properties. The company has commenced various exploration programs on their new Granite Mountain property in Alaska, with potential to find several types of minerals such as gold, platinum, copper, zinc, lead and uranium. The property is located near NovaGold where you will find North America’s largest gold reserve of 25 million ounces. Northern Dynasty is to the south with large copper/gold and Teck Cominco to the north with the world’s largest zinc mine. The area is ripe for further exploration success. Combined mineral reserve in the area is estimated at over 30 billion dollars!
RECOMMENDATION: BUY
For more information on Linux Gold Corp please see:
http://www.linuxgoldcorp.com/
Symbol: LNXGF
Update 1 - LINUX GOLD CORP MOVING AHEAD - LNXGF
September 20 2005
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-- Posted Wednesday, 21 September 2005 | Digg This Article
