|
-- Posted Wednesday, 15 April 2009 | Digg This Article | Source: GoldSeek.com
Last year gold and silver prices fell into a hole with the general stock markets, so the obvious conclusion is that if the stock market rally turns into another bear phase then gold and silver stocks will also fall. But then again this will only happen if the price of precious metals drops again, and there are plenty of reasons to believe that in a world of money printing and fears about devaluation and future inflation that gold and silver prices are going to go up, and up. You also have to consider the bombed out condition of many gold and silver stocks. The giant Pan American Silver is still 60 per cent off its high a year ago, and many juniors have fallen 80 per cent since then. Gold majors Now admittedly the gold majors and a few selectively punted stocks have showed much better gains. But perhaps they are leading the pack, and the pack is on the way up. Certainly a stock that has fallen 80 per cent has more upside than potential downside, and ought to be on a list of possible bargain buys. But is this the right moment to stock up on gold and silver stocks? If you read the technical analysts then the charts for precious metals are delicately poised and could be on the verge of a major uptrend. There is a nice cup-and-handle formation in silver, and gold could be breaking out of a typical consolidation period. The fundamentals for precious metals also look very attractive, with printing money now seen as the great new discovery by central banks in the US, UK and Japan. This is inflation by definition, and must result in higher prices for gold and silver which can not be manufactured. Alchemists tried and failed centuries ago. Bonds Last year the money from the equities sell-off went into US treasuries. But even the Chinese are beginning to worry that they have too many T-bonds with inflation on the horizon (inflation is the great destroyer of bond values) and have stopped buying with the same gusto. Perhaps this year the smart money will exit stocks and go for gold and silver. And with precious metal prices going up then the leverage of gold and silver equities ought to be the place to be.
-- Posted Wednesday, 15 April 2009 | Digg This Article | Source: GoldSeek.com
Previous Articles by Peter Cooper
About Peter Cooper:
Oxford University educated financial journalist Peter Cooper found himself made redundant by Emap plc in London in the mid-1990s and decided to rebuild his career in Dubai as launch editor of the pioneering magazine Gulf Business. He returned briefly to London in
1999 to complete his first book, a history of the Bovis construction group.
Then in 2000 he went back to Dubai to become an Internet entrepreneur, just as the dot-com market crashed. But he stumbled across the opportunity to become a partner in www.ameinfo.com, which later became the Middle East's leading English language business news website.
 Over the course of the next seven years he had a ringside seat as editor-in-chief writing about the remarkable transformation of Dubai into a global business and financial hub city. At the same time www.ameinfo.com prospered and was sold in 2006 to Emap plc for $27 million, completing the career circle back to where it began a decade earlier.
He remains a lively commentator and columnist as a freelance journalist based in Dubai and travels extensively each summer with his wife Svetlana. His financial blog www.arabianmoney.net is attracting increasing attention with its focus on investment in gold and silver as a means of prospering during a time of great consumer price inflation and asset price deflation.
Order my book online from this link
 
|
Will Gold Stocks Beat The Next Bear Market Leg?
