Best of the Week
Most Popular
1. Climate Change Mass Extinction - Birds, Bees and Bugs: Going Going Gone - Richard_Mills
2.A Purrrfect Gold Price Setup! - Peter_Degraaf
3.Who Finances America's Borrowing? Recession Indicator for Independent Thinkers Part 2 - F_F_Wiley
4.America’s One-sided Domestic Financial War - Raymond_Matison
5.Gold Price Summer Doldrums - Zeal_LLC
6.Two Key Events Will Unleash Gold - Jim_Willie_CB
7.Billionaire Schools Teacher in NAFTA Trade Talks - Richard_Mills
8.Get Out Of Crypto Cannabis Bubble Before It Pops and Move Into Bargain Basement Miners - Jeb_Handwerger
9.Stock Market Could Pullback for 1-2 weeks, But Medium Term Bullish - Troy_Bombardia
10.G7 Chaos, Central Banks and US Fed Will Drive Stock Prices This Week - Chris_Vermeulen
Last 7 days
Financial Markets Analysis and Trend Forecasts 2018 - A Message from Nadeem Walayat - 21st Jun 18
SPX Bouncing Above Support - 21st Jun 18
Things You Need To Know If You Want To Invest In Bitcoin Now - 21st Jun 18
The NASDAQ’s Outperformance vs. the Dow is Very Bullish - 21st Jun 18
Warning All Investors: Global Stock Market Are Shifting Away From US Price Correlation - 20th Jun 18
Gold GLD ETF Update… Breakdown ? - 20th Jun 18
Short-term Turnaround in Bitcoin Might Not Be What You Think - 19th Jun 18
Stock Market’s Short Term Downside Will be Limited - 19th Jun 18
Natural Gas Setup for 32% Move in UGAZ Fund - 19th Jun 18
Magnus Collective To Empower Automation And Artificial Intelligence - 19th Jun 18
Trump A Bull in a China Shop - 19th Jun 18
Minor Car Accident! What Happens After You Report Your Accident to Your Insurer - 19th Jun 18
US Majors Flush Out A Major Pivot Low and What’s Next - 18th Jun 18
Cocoa Commodities Trading Analysis - 18th Jun 18
Stock Market Consolidating in an Uptrend - 18th Jun 18
Russell Has Gone Up 7 Weeks in a Row. EXTREMELY Bullish for Stocks - 18th Jun 18
What Happens Next to Stocks when Tech Massively Outperforms Utilities and Consumer Staples - 18th Jun 18
The Trillion Dollar Market You’ve Never Heard Of - 18th Jun 18
The Corruption of Capitalism - 17th Jun 18
North Korea, Trade Wars, Precious Metals and Bitcoin - 17th Jun 18
Climate Change and Fish Stocks – Burning Oxygen! - 17th Jun 18
A $1,180 Ticket to NEW Trading Opportunities, FREE! - 16th Jun 18
Gold Bullish on Fed Interest Rate Hike - 16th Jun 18
Respite for Bitcoin Traders Might Be Deceptive - 16th Jun 18
The Euro Crashed Yesterday. Bearish for Euro and Bullish for USD - 15th Jun 18
Inflation Trade, in Progress Since Gold Kicked it Off - 15th Jun 18
Can Saudi Arabia Prevent The Next Oil Shock? - 15th Jun 18
The Biggest Online Gambling Companies - 15th Jun 18
Powell's Excess Reserve Change and Gold - 15th Jun 18
Is This a Big Sign of a Big Stock Market Turn? - 15th Jun 18
Will Italy Sink the EU and Boost Gold? - 15th Jun 18
Bumper Crash! Land Rover Discovery Sport vs Audi - 15th Jun 18
Stock Market Topping Pattern or Just Pause Before Going Higher? - 14th Jun 18
Is the ECB Ending QE a Good Thing? Markets Think So - 14th Jun 18
Yield Curve Continues to Flatten. A Bullish Sign for the Stock Market - 14th Jun 18
How Online Gambling has Impacted the Economy - 14th Jun 18
Crude Oil Price Targeting $58 ppb Before Finding Support - 14th Jun 18
Stock Market Near Another Top? - 14th Jun 18
Thorpe Park REAL Walking Dead Living Nightmare Zombie Car Park Ride Experience! - 14th Jun 18

Market Oracle FREE Newsletter

5 "Tells" that the Stock Markets Are About to Reverse

Forget The Gold Price!

Commodities / Gold & Silver Jul 09, 2007 - 03:12 PM GMT

By: David_Vaughn

Commodities

Let's get back to the subject of gold stocks…when do you buy and when do you sell? The million dollar question.

You know I am tired with such a preoccupied absorption of the gold price. Now I don't want to be a hypocrite here because I know I myself often get excited watching gold move higher. That is our natural human reaction to be excited about something climbing, whether it's a possum or a squirrel climbing high into an oak tree. But it is also natural to have a desire for truth and come to an understanding of what matters most when we are talking about making money.


Is there skepticism in this market? Yes there is.

Yet, making money in gold stocks is a very profitable venture with gold remaining above 400 per ounce. I personally could live with gold staying within its present range for years because I know there are companies producing phenomenal profits. And I do not believe the fundamentals are going to allow gold to sink below 400 per ounce any time soon. So is the gold price presently over 400 per ounce? You bet it is. Is significant money being made now in this market? You better believe it. But I cannot take you by the hand and take you to your broker. Those are personal decisions you will have to make on your own.

Look around you and see the gold, uranium and other natural resource stocks that are doing well and study these successful ones. Those companies that are quality exploration, development and / or production companies are going to climb higher in any kind of gold environment because they are in the act of building a resource base

and are currently undervalued. Yes, they are proving through active ongoing drilling programs just what size their deposit is and if the deposit continues to grow so too does the stock price.

Probably, the most exciting natural resource is uranium. It still appears to have great wind beneath its feet. 

“Uranium in 2008: $255/lb. Is Just the Beginning” “The recent record prices for uranium are only the beginning. The growing nuclear industry will ensure the demand for yellowcake. And by next year, we're going to see uranium break over $255 a pound.” “…our global energy situation is about to make a monumental change. Peak oil is looming on the doorstep (many experts argue it's already here). Don't forget our daily addiction to 85 million barrels of oil. We'll have to make that up when the oil stops flowing.” Click

These are the babies you need to be scouring for because my friend they are out there, but no one is going to hold you up by your pants straps and make you find them. You want to really make money in this market? Then get off your tail and start reading. Start subscribing to numerous publications that will share with you their knowledge on a regular consistent basis.

I repeat that the natural resource sector is made up of the best writers, commentators and analysts that you will find anywhere. Many of these analysts have appeared in Barron's and the Wall Street Journal. This is still some what of a secluded market but you too can run with the sheeple if you will learn to shut your mouth and start to listen to these extremely talented and skilled individuals.

David, “I don't think people get how close we are to an economic meltdown if rates spike higher.  Bernanke does. When gold, a non-incoming producing asset, gets real competition in the form of a positive interest rate offered on deposits, then it's time to scale back on the speculative gold positions and even hedge positions, but while money on deposit is LOSING value?  I don't think so.  Nominal rates don't matter.  Real rates do.  That's why gold kept rising in the face of a nominal double digit Fed funds rate in the late 70's and early 1980's.  Volcker turned real rates positive and that was the coup de gras for that bull market.” Thanks for your column. TW, Tryon, NC, Practically your neighbor.

Men like Gerbino, Casey, Ralston, Buckler, van Eeden, Murphy, Bishop, Hommel, Taylor, Dines, Krelin, Wiegard, Daughty, Willie, Coffin, Droke, Scultz, Schiff, Moriarty, Fleckenstein, Morgan, Doody, Appels, Embry, Grandich, Hamilton , Puplava, Roffy, Sinclair, Veneroso, Tice, Lundin. Do you know who these guys are? Do you recognize even three names on this list? And these are just scratching the surface as there are many, many more worth listening to and whose advice is worth following.

But this is what I mean when I say you have got to take the time to study this market and follow the brains who are experts in their fields of study. I say all this because so many investors purchase one single little company, one little egg in their basket and they wonder why they are not making money.

Sol Palha  - “It would be a prudent time to start looking into gold stocks that are extremely oversold now. Intuition becomes increasingly valuable in the new information society precisely because there is so much data.” Click

This game is about averaging. I know you might not like this word but by averaging I am referring to achieving success and having the ability to repeat that success multiple times. And for those shares that perform poorly your gains are balanced out because of the winners in your portfolio that have climbed 300% or higher multiples. Averaging. And that averaging is accomplished by spreading your risks between established excellent plays that are worthy of speculation.

Yes, you will have losers, but those losers will be negated by those that will climb to the moon and above. Is there money presently being made in gold, uranium, silver, copper and other natural resource shares? Go ask these men and they will be happy to share that knowledge with you. And don't be afraid if what you might want to learn may cost you a couple of dollars. I have been on this earth long enough to learn that achieving anything worth while in this life requires a great deal of hard work, our time and yes, our money.

Anyway, regardless of your over absorption of the gold price does the following price action look like a bull market in remission? Give me a break.

You are not going to become an expert over night, but you can learn to take excellent advice and weigh that advice among numerous other expert individuals. If the advice is sound then others are also going to agree. Again, I say your objective is to make money in natural resource mining stocks and not just sit around watching the gold price every day.

Do you want to spend your time crying and pouting like a baby over spilled milk?

Or do you want to start acting like a grown up and concentrate where the money is – resource & gold mining stocks. Excuse me for being harsh, but I am up to my ears with complaints by those who are missing profits because their eyes are fixated on the fluctuating gold price. Let it. I care not a whit as long as I can continue to purchase quality mining stocks and see them go up often multiple times in value. As I have said before this speculation game belongs to big boys and not couch potatoes and librarians.

Am I questioning the precise correlation between the price of gold and the price of a corresponding gold mining stock? Yes, I am. A gold executive generally fixtures in very much lower gold prices to determine his profit margin. So in reality the gold producer has calculated conservative profits figuring on a very much lower gold price than what presently exits in the markets. So one way to look at the gold price is to sincerely realize that forever how long the gold price rests above 400 an ounce we are looking at a very flexible and profitable range of substantial profits.

Gold Letter's 10 best performing stocks are up over 2,000% and GL's top 55 performing stocks are up over 500%. Close to 90% of all Gold Letter's recommendations since inception in January, 2003 are up over 250%. GL charts are computer generated and updated every hour while markets are open.

Click here to order Gold Letter

“…there is a convergence of global events that will have profound implications for our world. The effects of the convergence are just now beginning to manifest themselves in our country.” Doug Tjaden, Traditions of Men

By David Vaughn
Gold Letter, Inc.
David4054@charter.net

The publisher and its affiliates, officers, directors and owner may actively trade in investments discussed in this newsletter. They may have positions in the securities recommended and may increase or decrease such positions without notice. The publisher is not a registered investment advisor. Subscribers should not view this publication as offering personalized legal, tax, accounting or investment-related advice. The news and editorial viewpoints, and other information on the investments discussed herein are obtained from sources deemed reliable, but their accuracy is not guaranteed. © Copyright 2007, Gold Letter Inc.

David Vaughn Archive

© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules