IAMGOLD and Newmont Mining sell Silidor Project
Newmont Mining (NYSE:NEM) and IAMGOLD (NYSE:IAG) sold their stakes in the Silidor property to Visible Gold Mines.
The acquisition will be through the issuing of common shares to the two companies by Visible Gold Mines, with Newmont receiving 55 percent and IAMGOLD 45 percent.
The entire stake is being sold, as Visible Gold Mines takes over the entire property. Visible is a natural resource mining company.
Newmont Canada Corporation, the actual company selling its stake, is a subsidiary of Newmont Mining.
IAMGOLD and Newmont Mining sell Silidor Project
Showing posts with label Gold Report. Show all posts
Showing posts with label Gold Report. Show all posts
Tuesday, March 9, 2010
Eldorado Gold (NYSE:EGO) Gold Reserves Up 42 Percent
Gold Reserves at Eldorado Gold Eastern Dragon Project
The Eastern Dragon Project in China has exceeded original proven and probable gold reserves by a large margin, as Eldorado Gold (NYSE:EGO) now estimates about 747,000 ounces now in the mine, and more possibly to be discovered.
Just on the most recent revised data the company has increased its exploration budget at the mine by $2.4 million, as they search other vein structures for more gold resources at their prolific project.
Gold Reserves at Eldorado Gold Eastern Dragon Project
The Eastern Dragon Project in China has exceeded original proven and probable gold reserves by a large margin, as Eldorado Gold (NYSE:EGO) now estimates about 747,000 ounces now in the mine, and more possibly to be discovered.
Just on the most recent revised data the company has increased its exploration budget at the mine by $2.4 million, as they search other vein structures for more gold resources at their prolific project.
Gold Reserves at Eldorado Gold Eastern Dragon Project
Thursday, March 4, 2010
Yamana Gold (NYSE:AUY) Misses Profits On Executive Bonuses
Yamana Gold Executive Bonuses
Yamana Gold (NYSE:AUY) said it missed its profit numbers in the fourth quarter because of Executive bonuses, which drove up the selling, general and administrative costs of the company for the quarter.
Revenue was also down in the quarter, coming in at around $400 million when analysts had been looking for over $420 million.
More concerning for Yamana is the gold it claims is under the earth they dig didn't increase in 2009, giving the obvious impression they miscalculated the amount of provable reserves there in the first place.
Still, from an operational standpoint that's encouraging in that they were on top of costs in general because they were able to pay out bonuses while only missing the profit target per share by a penny.
Yamana Gold Executive Bonuses
Yamana Gold (NYSE:AUY) said it missed its profit numbers in the fourth quarter because of Executive bonuses, which drove up the selling, general and administrative costs of the company for the quarter.
Revenue was also down in the quarter, coming in at around $400 million when analysts had been looking for over $420 million.
More concerning for Yamana is the gold it claims is under the earth they dig didn't increase in 2009, giving the obvious impression they miscalculated the amount of provable reserves there in the first place.
Still, from an operational standpoint that's encouraging in that they were on top of costs in general because they were able to pay out bonuses while only missing the profit target per share by a penny.
Yamana Gold Executive Bonuses
Tuesday, March 2, 2010
Red Back Mining (TSE:RBI) Reserves Increasing
Red Back Mining Gold Reserves
Red Back Mining (TSE:RBI) has enjoyed some good news over the last several days as reports of increased reserves continue, this time, again, at their Tasiast Mine in Mauritania.
Proven reserves overall were increased by 64 percent to about 5 million ounces, bringing the total to 49.4 million tons. That is graded at 1.36 grams a ton.
For reserves graded at 1.4 grams a ton, probable reserves are at around 61.5 million tons.
CEO and President fo Red Back Mining, Rick Clark said the company is looking "forward to reporting further Reserve increases and other exploration results in the coming months."
Red Back Mining Gold Reserves
Red Back Mining (TSE:RBI) has enjoyed some good news over the last several days as reports of increased reserves continue, this time, again, at their Tasiast Mine in Mauritania.
Proven reserves overall were increased by 64 percent to about 5 million ounces, bringing the total to 49.4 million tons. That is graded at 1.36 grams a ton.
For reserves graded at 1.4 grams a ton, probable reserves are at around 61.5 million tons.
CEO and President fo Red Back Mining, Rick Clark said the company is looking "forward to reporting further Reserve increases and other exploration results in the coming months."
Red Back Mining Gold Reserves
Newmont Mining (NYSE:NEM) Sells Amulsar Gold Project
Newmont Mining Sells Stake in Amulsar Gold Project to Lydia International
Newmont Mining (NYSE:NEM) has sold its stake in the Amulsar Gold Project in Armenia to partner Lydian International Ltd (TSE:LYD), in deal involving cash and stock.
Terms of the deal include Geoteam C.J.S.C., a division of Lydia, to acquire the company for $15 million in cash, along with close to 3 million in shares of the company. The $15 million will reportedly be paid in three $5 million installments.
The overall deal values the Amulsar Gold Project at close to $25 million, after applying a 10 percent discount rate.
After the deal closes, Newmont will completely exit the joint venture and Geoteam will totally own the Amulsar Gold Project at that time.
Lydian Chief Executive Officer Tim Coughlin said the reason for the deal was to get the "Amulsar gold project into production by 2013."
Newmont Mining Sells Stake in Amulsar Gold Project to Lydia International
Newmont Mining (NYSE:NEM) has sold its stake in the Amulsar Gold Project in Armenia to partner Lydian International Ltd (TSE:LYD), in deal involving cash and stock.
Terms of the deal include Geoteam C.J.S.C., a division of Lydia, to acquire the company for $15 million in cash, along with close to 3 million in shares of the company. The $15 million will reportedly be paid in three $5 million installments.
The overall deal values the Amulsar Gold Project at close to $25 million, after applying a 10 percent discount rate.
After the deal closes, Newmont will completely exit the joint venture and Geoteam will totally own the Amulsar Gold Project at that time.
Lydian Chief Executive Officer Tim Coughlin said the reason for the deal was to get the "Amulsar gold project into production by 2013."
Newmont Mining Sells Stake in Amulsar Gold Project to Lydia International
Friday, February 26, 2010
Eldorado Gold (NYSE:EGO) in Gold Bull Market
Eldorado Gold Bull Market
With holdings in a number of European, Asian and South American countries, Eldorado Gold (NYSE:EGO) looks like a good play in the ongoing gold bull market.
There is no doubt with recently released data from the Labor Department and Commerce Department of the United States that the recession is continuing on, and gold will continue to be one of the few reliable and predictable places to put your money in the mid-term.
Along with that, the Federal Reserve and Ben Bernanke refuse to stop their money printing press, and so inflation is inevitable, and along with the sovereign debt issues in a number of countries in the European Union (PIIGS), gold will continue to be a safety haven for some time to come.
Eldorado Gold (NYSE:EGO) is in a good position to take advantage of those realities and will perform well for investors.
Eldorado Gold Bull Market
With holdings in a number of European, Asian and South American countries, Eldorado Gold (NYSE:EGO) looks like a good play in the ongoing gold bull market.
There is no doubt with recently released data from the Labor Department and Commerce Department of the United States that the recession is continuing on, and gold will continue to be one of the few reliable and predictable places to put your money in the mid-term.
Along with that, the Federal Reserve and Ben Bernanke refuse to stop their money printing press, and so inflation is inevitable, and along with the sovereign debt issues in a number of countries in the European Union (PIIGS), gold will continue to be a safety haven for some time to come.
Eldorado Gold (NYSE:EGO) is in a good position to take advantage of those realities and will perform well for investors.
Eldorado Gold Bull Market
Thursday, February 25, 2010
Gold Rising 30% in 2010?
Gold Rising 30% in 2010
According to the London Market Bullion Association, gold could rise close to 30 percent in 2010, as continual concerns over central banks printing money, sovereign defaults, quantitative easing and outrageous government stimulus programs weigh on the minds of investors.
It's unknown what will happen if the British pound collapses, as a number of investment experts like Jim Rogers and Marc Faber are predicting, and that could cause gold prices to go through the roof as investors and consumers look for somewhere safe to place their money.
Now that the government stimulus programs have been proven to be mass failures, the growing realization we aren't close to being out of the recession yet is settling on people, and that will cause even more to move toward gold as a haven.
In the short term it doesn't look like any new gold mines are coming online either, making gold a possible rare commodity as funds continue to buy physical gold to back them up. That is another possible factor which could move gold prices higher in 2010 and beyond.
Gold Rising 30% in 2010
According to the London Market Bullion Association, gold could rise close to 30 percent in 2010, as continual concerns over central banks printing money, sovereign defaults, quantitative easing and outrageous government stimulus programs weigh on the minds of investors.
It's unknown what will happen if the British pound collapses, as a number of investment experts like Jim Rogers and Marc Faber are predicting, and that could cause gold prices to go through the roof as investors and consumers look for somewhere safe to place their money.
Now that the government stimulus programs have been proven to be mass failures, the growing realization we aren't close to being out of the recession yet is settling on people, and that will cause even more to move toward gold as a haven.
In the short term it doesn't look like any new gold mines are coming online either, making gold a possible rare commodity as funds continue to buy physical gold to back them up. That is another possible factor which could move gold prices higher in 2010 and beyond.
Gold Rising 30% in 2010
David Einhorn: Gold and Government
David Einhorn on Gold
Speaking at the Value Investing Congress recently, David Einhorn of Greenlight Capital, revealed the reasons he felt gold was a solid investment into the future.
Looking at it from a slightly different point of view, Einhorn said in his opinion, gold does the best based on the fiscal policies being enacted. When the Federal Reserve and other central banks ramp up their printing presses, gold does well, when they deal with it like Paul Volcker did in the 1970s, gold does poorly. And obviously, we're not in a Volcker-like environment at this time.
Unless the government starts wising up and takes the right course of action, Einhorn said gold will do good for some time to come.
With the sovereign debt of a number of nations in serious trouble, and in danger of default, Einhorn looks at that and any currency crisis as markers that gold will do well in those circumstances too.
Taking into consideration the horrid economic policies of the Obama administration, gold has a bright and long future ahead of it for those investing in gold.
David Einhorn on Gold
Speaking at the Value Investing Congress recently, David Einhorn of Greenlight Capital, revealed the reasons he felt gold was a solid investment into the future.
Looking at it from a slightly different point of view, Einhorn said in his opinion, gold does the best based on the fiscal policies being enacted. When the Federal Reserve and other central banks ramp up their printing presses, gold does well, when they deal with it like Paul Volcker did in the 1970s, gold does poorly. And obviously, we're not in a Volcker-like environment at this time.
Unless the government starts wising up and takes the right course of action, Einhorn said gold will do good for some time to come.
With the sovereign debt of a number of nations in serious trouble, and in danger of default, Einhorn looks at that and any currency crisis as markers that gold will do well in those circumstances too.
Taking into consideration the horrid economic policies of the Obama administration, gold has a bright and long future ahead of it for those investing in gold.
David Einhorn on Gold
Monday, February 22, 2010
George Soros' Gold Contradictions
George Soros and Gold
Why is it that George Soros has said recently gold was "the ultimate asset bubble," and then not long before pour a ton of his money into it?
It think it's a little game Soros is playing in an attempt to throw investors off his trail, throwing out some confusion to keep them from putting some skin in the game.
There isn't a gold bubble right now, and historically a bubble of any sort is when the everyday person is throwing their money at something for the sole reason that everyone else is doing it. Until we see the average person on the street investing in gold, it won't be in a bubble.
This of course doesn't mean there won't be any corrections, just that a bubble is something that is going to burst, and until conditions change drastically, gold will be as solid as a performer as any other investment sector.
It's obvious George Soros is playing a little game by saying one thing while doing another, and he has to do that because of the requirements to report what he is investing because of rules related to companies with over $100 million in available to invest.
George Soros and Gold
Why is it that George Soros has said recently gold was "the ultimate asset bubble," and then not long before pour a ton of his money into it?
It think it's a little game Soros is playing in an attempt to throw investors off his trail, throwing out some confusion to keep them from putting some skin in the game.
There isn't a gold bubble right now, and historically a bubble of any sort is when the everyday person is throwing their money at something for the sole reason that everyone else is doing it. Until we see the average person on the street investing in gold, it won't be in a bubble.
This of course doesn't mean there won't be any corrections, just that a bubble is something that is going to burst, and until conditions change drastically, gold will be as solid as a performer as any other investment sector.
It's obvious George Soros is playing a little game by saying one thing while doing another, and he has to do that because of the requirements to report what he is investing because of rules related to companies with over $100 million in available to invest.
George Soros and Gold
Wednesday, February 17, 2010
Gold Bull Market Over?
Gold Bull Market
I find it hilarious when clueless people attempt to make assertions like those I've been hearing lately that the bull market in gold is over.
The primary ignorance of some of those making these assertions is that the recent increase in gold prices has been because of gold bugs, rather than market forces, or in this case: lack of force in the market.
For some reason, people seem to resent or reject the fact that gold performs strongly when adverse economic and world conditions are uncertain, and we have been in that situation for several years, and will continue to be for many more.
Anyone who asserts gold bugs are behind the run up in gold prices understands nothing about historical responses to tough economic circumstances, the extreme printing of money, and the inevitable inflation that follows.
Add to that the sovereign risk associated with a growing number of countries, along with rising inflation, and you have a perfect economic storm for the rise in gold prices to continue, and they will.
What about the so-called gold bubble some think we're in? There's no evidence of it, on the contrary, for the most part institutional investors are the primary investors in gold, and until the general population enters into the sector, there will not be, neither can there be, a gold bubble.
Gold has a great future over the next several years, and possibly longer, depending on the rate of inflation and how long it'll take to realize we are still in the middle of a recession.
Once that happens, we'll see gold surge even higher, and those positioned to take advantage of that should enjoy strong profits from gold investing for a number of years to come.
Gold Bull Market
I find it hilarious when clueless people attempt to make assertions like those I've been hearing lately that the bull market in gold is over.
The primary ignorance of some of those making these assertions is that the recent increase in gold prices has been because of gold bugs, rather than market forces, or in this case: lack of force in the market.
For some reason, people seem to resent or reject the fact that gold performs strongly when adverse economic and world conditions are uncertain, and we have been in that situation for several years, and will continue to be for many more.
Anyone who asserts gold bugs are behind the run up in gold prices understands nothing about historical responses to tough economic circumstances, the extreme printing of money, and the inevitable inflation that follows.
Add to that the sovereign risk associated with a growing number of countries, along with rising inflation, and you have a perfect economic storm for the rise in gold prices to continue, and they will.
What about the so-called gold bubble some think we're in? There's no evidence of it, on the contrary, for the most part institutional investors are the primary investors in gold, and until the general population enters into the sector, there will not be, neither can there be, a gold bubble.
Gold has a great future over the next several years, and possibly longer, depending on the rate of inflation and how long it'll take to realize we are still in the middle of a recession.
Once that happens, we'll see gold surge even higher, and those positioned to take advantage of that should enjoy strong profits from gold investing for a number of years to come.
Gold Bull Market
Gold Futures Explode Past $1,100 an Ounce
Gold futures prices surge
Gold futures shot up almost $30 an ounce. Gold for April delivery ended at $29.80 to finish the day at $1,119.80 an ounce, a gain of 2.7 percent for the session. It went as high a $1,121.90 an ounce during the day before pulling back.
Other metals did well too, as silver increased by 71 cents for March delivery, while copper rose 14 cents to $3.22 a pound.
Another factor helping commodities throughout the day was the news that manufacturing had increased at a quicker pace than expected, although that could largely be due to the replenishing of stockpiles rather than growth.
Either way, gold looks to take off again, with $1,125 being what is looked for for the next breakthrough needed.
Gold futures prices surge
Gold futures shot up almost $30 an ounce. Gold for April delivery ended at $29.80 to finish the day at $1,119.80 an ounce, a gain of 2.7 percent for the session. It went as high a $1,121.90 an ounce during the day before pulling back.
Other metals did well too, as silver increased by 71 cents for March delivery, while copper rose 14 cents to $3.22 a pound.
Another factor helping commodities throughout the day was the news that manufacturing had increased at a quicker pace than expected, although that could largely be due to the replenishing of stockpiles rather than growth.
Either way, gold looks to take off again, with $1,125 being what is looked for for the next breakthrough needed.
Gold futures prices surge
Barrick Gold (TSE:ABX), Goldcorp (TSE:G), Kinross Gold (TSE:K) Should Generate Strong Fourth-quarter Profits
Barrick Gold, Goldcorp, Kinross Gold
The top three Canadian mining companies, Barrick Gold (TSE:ABX), Goldcorp (TSE:G) and Kinross Gold (TSE:K), are all expected to announce strong profits in the fourth quarter, with estimates for Barrick Gold and Goldcorp expected to double from the year before, and Kinross looking for an increase in earnings of around 75 percent.
The companies have just about everything going for them at this time, as precious metal prices continue to rise, gold bullion is rising, and the cost of doing business has been managed well by the three.
It doesn't hurt that the price of gold hit highs during the quarter either.
Even so, the even better news is the companies managed costs very well during this time, which ultimately be the deciding factor in how high the earnings will be for them.
The cost margin was a hefty $652 an ounce, a strong increase over the third quarter, which stood at $504 an ounce.
Barrick Gold, Goldcorp, Kinross Gold
The top three Canadian mining companies, Barrick Gold (TSE:ABX), Goldcorp (TSE:G) and Kinross Gold (TSE:K), are all expected to announce strong profits in the fourth quarter, with estimates for Barrick Gold and Goldcorp expected to double from the year before, and Kinross looking for an increase in earnings of around 75 percent.
The companies have just about everything going for them at this time, as precious metal prices continue to rise, gold bullion is rising, and the cost of doing business has been managed well by the three.
It doesn't hurt that the price of gold hit highs during the quarter either.
Even so, the even better news is the companies managed costs very well during this time, which ultimately be the deciding factor in how high the earnings will be for them.
The cost margin was a hefty $652 an ounce, a strong increase over the third quarter, which stood at $504 an ounce.
Barrick Gold, Goldcorp, Kinross Gold
Tuesday, February 16, 2010
Gold Gains on Haven Investing
Gold Futures Prices Going Up
As the fiasco in Europe continues to expose the weak underside of the alleged economic recovery, investors are again shifting their assets to gold as a place of safety as unsurety as what to do about Greece and the potential domino effect it could have on other parts of Europe.
The euro has been a disaster during this time as well, and the U.S. dollar and whether it is weak or strong is being overwhelmed by safety concerns, making it less of a factor during these times, as far as it relates to the movement of gold prices.
Gold in London reached as high as $1,102.55 an ounce, the highest it has been since February 4.
Growing pressure for finance ministers in Europe to lay out exactly what they're going to do to help Greece other than assert that they're going to continues on, and I know they are worried about that, as anything could go wrong in these economic circumstances that include corruption and typical creative accounting which made the country and its sovereign debt in much better shape than it actually was and is.
Just a short time ago people were projecting a major pullback in gold prices, I think those projections can be tossed aside, as the Greek problem and other related economic issues aren't going to go away for a long time.
Gold is going to roar back to life, and should start its inevitable climb once again. It looks like this will be a support for gold futures prices for some time to come.
Gold Futures Prices Going Up
As the fiasco in Europe continues to expose the weak underside of the alleged economic recovery, investors are again shifting their assets to gold as a place of safety as unsurety as what to do about Greece and the potential domino effect it could have on other parts of Europe.
The euro has been a disaster during this time as well, and the U.S. dollar and whether it is weak or strong is being overwhelmed by safety concerns, making it less of a factor during these times, as far as it relates to the movement of gold prices.
Gold in London reached as high as $1,102.55 an ounce, the highest it has been since February 4.
Growing pressure for finance ministers in Europe to lay out exactly what they're going to do to help Greece other than assert that they're going to continues on, and I know they are worried about that, as anything could go wrong in these economic circumstances that include corruption and typical creative accounting which made the country and its sovereign debt in much better shape than it actually was and is.
Just a short time ago people were projecting a major pullback in gold prices, I think those projections can be tossed aside, as the Greek problem and other related economic issues aren't going to go away for a long time.
Gold is going to roar back to life, and should start its inevitable climb once again. It looks like this will be a support for gold futures prices for some time to come.
Gold Futures Prices Going Up
Monday, February 8, 2010
Gold Fields (NYSE:GFI) Profits Up 44 Percent
Gold Fields (NYSE:GFI) Profits Up 44 Percent
We are about to get a bunch of earnings reports in the days ahead for gold mining companies, and starting things off was Gold Fields Limited (NYSE:GFI), which enjoyed profit growth for the latest quarter of 44 percent, or $187 million.
That's an increase of 44 percent over the third-quarter results and 146 percent over the fourth quarter of 2008.
Most of that profit growth for Gold Fields was because of the continuing spike in gold prices.
The company would have performed better had it better managed the mining safety delays experienced in the last quarter which brought gold production down to 900,000 ounces, in contrast to the 906,000 ounces of gold produced in the previous quarter.
South African gold production continues to be a concern with the company saying they are expecting only 850,000 ounces of gold in the first quarter of 2010 as a result.
Other concerns putting downwards pressure on the share price of Gold Fields Limited are the possibility of gold mines in South Africa being nationalized, possibilities of a lower price for gold, and why the company is offering a dividend of only 50 cents a share.
Gold Fields continues to be an unpredictable performer because of its strong presence in South Africa, and because of the high leverage associated with that, the company performs stronger when the price of gold goes up in contrast to many of its competitors, but also takes a bigger hit than its competitors when the price of gold goes down.
Gold Fields (NYSE:GFI) Profits Up 44 Percent
We are about to get a bunch of earnings reports in the days ahead for gold mining companies, and starting things off was Gold Fields Limited (NYSE:GFI), which enjoyed profit growth for the latest quarter of 44 percent, or $187 million.
That's an increase of 44 percent over the third-quarter results and 146 percent over the fourth quarter of 2008.
Most of that profit growth for Gold Fields was because of the continuing spike in gold prices.
The company would have performed better had it better managed the mining safety delays experienced in the last quarter which brought gold production down to 900,000 ounces, in contrast to the 906,000 ounces of gold produced in the previous quarter.
South African gold production continues to be a concern with the company saying they are expecting only 850,000 ounces of gold in the first quarter of 2010 as a result.
Other concerns putting downwards pressure on the share price of Gold Fields Limited are the possibility of gold mines in South Africa being nationalized, possibilities of a lower price for gold, and why the company is offering a dividend of only 50 cents a share.
Gold Fields continues to be an unpredictable performer because of its strong presence in South Africa, and because of the high leverage associated with that, the company performs stronger when the price of gold goes up in contrast to many of its competitors, but also takes a bigger hit than its competitors when the price of gold goes down.
Gold Fields (NYSE:GFI) Profits Up 44 Percent
Friday, February 5, 2010
Coeur d'Alene Mines (NYSE:CDE) New Gold Vein
Coeur d'Alene Mines
Coeur d'Alene Mines (NYSE:CDE) announced they've discovered a new gold vein at its Kensington mine near Juneau, Alaska.
Only in the first phase of drilling, officials at the company say it'll take additional work before they will be able to give a solid estimate as to how much gold will be produced as a result of the new find.
A spokesman form Coeur d'Alene Mines said it has potential to turn into a major find, but it still has to be confirmed of course.
At this time the Kensington mine has an estimated 1.5 million ounces in gold reserves in it, with an unknown additional amount from the new gold vein.
Coeur d'Alene Mines
Coeur d'Alene Mines (NYSE:CDE) announced they've discovered a new gold vein at its Kensington mine near Juneau, Alaska.
Only in the first phase of drilling, officials at the company say it'll take additional work before they will be able to give a solid estimate as to how much gold will be produced as a result of the new find.
A spokesman form Coeur d'Alene Mines said it has potential to turn into a major find, but it still has to be confirmed of course.
At this time the Kensington mine has an estimated 1.5 million ounces in gold reserves in it, with an unknown additional amount from the new gold vein.
Coeur d'Alene Mines
Tuesday, February 2, 2010
Gold Gains Most in Three Months
Gold rises to best daily performance in three months
Gold posted a 2 percent gain on Monday, the best daily increase in gold prices in three months, as a weak dollar helped drive gold prices up.
Oil moving up in price was also attributed to gold responding in such a strong fashion.
The last time gold moved up this much in a day was on November 3.
April delivery for gold futures rose by $21.20 to $1,105 an ounce on the Comex division of the New York Mercantile Exchange, equal to the 2 percent increase mentioned.
With inflation expected to pick up in 2010, it's sure gold will continue on its upwards price trend, even though the U.S. dollar has recently strengthened. While the dollar is expected to resume that performance on a temporary basis, it's unlikely to continue for a long period of time, and gold will again be the focus for investors looking for safety and an inflation hedge.
There should be some price swings in gold based upon these two scenarios playing out over the months.
Gold rises to best daily performance in three months
Gold posted a 2 percent gain on Monday, the best daily increase in gold prices in three months, as a weak dollar helped drive gold prices up.
Oil moving up in price was also attributed to gold responding in such a strong fashion.
The last time gold moved up this much in a day was on November 3.
April delivery for gold futures rose by $21.20 to $1,105 an ounce on the Comex division of the New York Mercantile Exchange, equal to the 2 percent increase mentioned.
With inflation expected to pick up in 2010, it's sure gold will continue on its upwards price trend, even though the U.S. dollar has recently strengthened. While the dollar is expected to resume that performance on a temporary basis, it's unlikely to continue for a long period of time, and gold will again be the focus for investors looking for safety and an inflation hedge.
There should be some price swings in gold based upon these two scenarios playing out over the months.
Gold rises to best daily performance in three months
Thursday, January 28, 2010
Barrick (NYSE:ABX) Chairman: Gold Prices Will Continue to Go Up
Barrick Chairman: Gold Prices going up
Acknowledging there will always be some volatility in the short term movement of gold prices, Barrick Gold (NYSE:ABX) chairman Peter Munk said in Davos recently that the gold prices will continue to go up, and the strength of the gold trend is "here to stay."
Munk stated that the price of gold "may fluctuate," but "the key criteria should be that it's got a secular tendency now to move up year in and year out.
"While it may trade off in the two-week or three-month period, I think the trend is here to stay."
Even though gold prices have fallen 11 percent since their record high last month, the increase in the spot price of gold, which soared 40 percent in 2009, is far from over.
Estimates are gold prices could climb by 13 percent in 2010, as continued worries over inflation, interest rates and the fall in value in the U.S. dollar weight on comsumers' and investors' minds.
Barrick Chairman: Gold Prices going up
Acknowledging there will always be some volatility in the short term movement of gold prices, Barrick Gold (NYSE:ABX) chairman Peter Munk said in Davos recently that the gold prices will continue to go up, and the strength of the gold trend is "here to stay."
Munk stated that the price of gold "may fluctuate," but "the key criteria should be that it's got a secular tendency now to move up year in and year out.
"While it may trade off in the two-week or three-month period, I think the trend is here to stay."
Even though gold prices have fallen 11 percent since their record high last month, the increase in the spot price of gold, which soared 40 percent in 2009, is far from over.
Estimates are gold prices could climb by 13 percent in 2010, as continued worries over inflation, interest rates and the fall in value in the U.S. dollar weight on comsumers' and investors' minds.
Barrick Chairman: Gold Prices going up
Monday, January 4, 2010
Major Gold ETFs Hold $16.9 Billion
Gold ETF Performance 2009
The gold holdings fo the major gold ETFs have approximately an aggregate amount of gold worth $16.9 billion net on a daily basis, according to the latest figures for 2009. Those aren't the final figures for 2009, as it only takes us up to mid-December.
Overall the key gold ETFs held close to $61.3 billion, a major increase of 84 percent year over year. That means an additional 546 tons of gold was added to the reserves of these gold funds in 2009.
Price per ounce for gold during that period rose by $213 an ounce, making it a highly profitable year for most.
Net daily flows in the funds differ from the value of the gold held by the funds because it fluxuates on a continuous basis.
The value of gold in the funds increased by about 65 percent over the net value of the money put into them.
Gold ETF Performance 2009
The gold holdings fo the major gold ETFs have approximately an aggregate amount of gold worth $16.9 billion net on a daily basis, according to the latest figures for 2009. Those aren't the final figures for 2009, as it only takes us up to mid-December.
Overall the key gold ETFs held close to $61.3 billion, a major increase of 84 percent year over year. That means an additional 546 tons of gold was added to the reserves of these gold funds in 2009.
Price per ounce for gold during that period rose by $213 an ounce, making it a highly profitable year for most.
Net daily flows in the funds differ from the value of the gold held by the funds because it fluxuates on a continuous basis.
The value of gold in the funds increased by about 65 percent over the net value of the money put into them.
Gold ETF Performance 2009
Friday, October 9, 2009
Chinese Buying Up More Gold
As gold prices hit new record highs, that hasn't deterred the Chinese government and individual Chinese investors from continuing to plow a lot of money into the yellow metal.
And the fact that retail jewelry built from gold has taken a hit has largely been shrugged off by the market, as that hasn't really been much of a factor ever in determing gold prices, especially in volatile economic times.
Consequently, investment in gold is the only driver of gold prices at this time, and with the economic conditions we face, there's no doubt gold prices will rise for many years to come, with occasional and obvious corrections as it goes along. But the curve will continue to be up with occasional dips in gold prices.
The Chinese government is also looking for places to place their money, and have been buying up large amounts of gold for some time, although with all of that, there's plenty of room for more, as at this time only about 1.6 percent of the china's forex reserves are held in gold.
Most Chinese believe their is significant upside to gold prices, and aren't going to cut back in their acquisitions of gold any time soon.
And the fact that retail jewelry built from gold has taken a hit has largely been shrugged off by the market, as that hasn't really been much of a factor ever in determing gold prices, especially in volatile economic times.
Consequently, investment in gold is the only driver of gold prices at this time, and with the economic conditions we face, there's no doubt gold prices will rise for many years to come, with occasional and obvious corrections as it goes along. But the curve will continue to be up with occasional dips in gold prices.
The Chinese government is also looking for places to place their money, and have been buying up large amounts of gold for some time, although with all of that, there's plenty of room for more, as at this time only about 1.6 percent of the china's forex reserves are held in gold.
Most Chinese believe their is significant upside to gold prices, and aren't going to cut back in their acquisitions of gold any time soon.
Sunday, December 28, 2008
Commodities: Riots in the Streets of America
Bob Moriarty in an explosive interview on what he sees in the not-too-distant future for America, and how people can prepare for the unsettling times.
The Gold Report: Bob, what do you think of the Fed’s latest move—cutting to a flexible zero to a quarter rate? Where do you see us going?
Bob Moriarty: We are to the point where we are about 14 feet from going over the edge of Niagara Falls. We haven’t gone over the edge yet; we haven’t gone to a total collapse. We don’t have riots in the streets; we don’t have a revolution. That’s coming; that’s about two to three months off.
Here’s what we’ve got: the Fed has committed to $8.5 trillion of taxpayers’ money to bail out the worst run companies and banks. It hasn’t worked. Now, they’re at a 0% to .25% on the Fed Funds rate for funds for banks, which means if you go down and you pay $100,000 for a T-bill for 90 days, your return is zero, which is to imply that there is zero risk to investing with the government. Anybody who actually believes that is going to be in for a real shock in the first quarter of next year.
GM has lost has lost $80 billion dollars in the last four years. They’re burning through $2 billion a month when everything is going well. Their sales are down 37% in November; the mathematical probability of GM surviving is zero. But we’re going to pour more taxpayer money down that hole. AIG's also turned into the proverbial black hole. I would think that at $300 billion or $400 billion or $500 billion or $600 billion, somebody’s going to wake up and say, “You know, we’re losing a lot of money here.”
TGR: It’s getting to be real money at that point.
BM: What we have done is guaranteed hyperinflation in the United States. We have guaranteed the destruction of the United States. We will have riots starting in the first quarter of next year; we will default by the summer of 2009.
TGR: Default on how many of the bonds? All? Or just some?
BM: 100%. The US government is going to default. Treasuries, Fannie Mae, Freddie Mac, the whole lot. It’s the end of empire. The United States government will not exist in its current form a year from now.
TGR: When you say “its current form,” what form will it take?
BM: I don’t know. It’s a really good question. I’m sure it will be a total state of chaos. I mean we’ve never been here. I think the analogy of the Soviet Union is probably the closest; we could break up into a series of little fiefdoms. But here’s what’s important to understand—the United States government has failed at every single level. It is too big; it is too unwieldy; it doesn’t work.
TGR: So, what does it mean? We’ve got impending chaos in the United States—and the financial markets will continue to go downward. Are we talking globally or U.S.?
BM: U.S. primarily, but globally because the U.S. is so important. The U.S. is the linchpin right now, but the rest of the world is going to have to learn to get by without the United States. What George Bush and Dick Cheney have done is essentially destroyed the United States; they have bankrupted the country. We are going to end up having our troops march out of Iraq to the nearest border because we can no longer afford to pay for them. We’re going to go into Zimbabwe-type inflation where they’re printing off $200 million dollar bills to buy a loaf of bread.
TGR: Other than moving to a nice island in the Caribbean, what does an investor or a resident of the U.S. do?
BM: You have to prepare; first of all, it’s important to prepare mentally and that means doing some education. Second, you don’t want to be in debt. You don’t want to be buying real estate. You don’t want to be taking any chances financially whatsoever. You want to be investing in real resources: good solid producing gold companies or silver companies or energy companies. You want to really hunker down.
TGR: If the financial markets continue to get clobbered, I would assume the gold equity stocks would continue to get clobbered?
BM: I don’t think they will. Here’s what is going to happen. There is actually a lot of money sitting on the sidelines. I’ve heard there's billions of dollars waiting to be invested in resource stocks. Resource stocks are selling for 5 cents or 10 cents on the dollar; that’s not going to last for very long.
What I want to get across to everybody is and it’s very important, is that when you go through chaos, the worse it gets, the more inclined you are to solve it. There are some easy solutions to this financial situation in the United States.
First of all, we downsize; we stop spending all this money at the federal level; we stop spending money at the state level. We end up with a much smaller government that isn’t trying to make every decision for every person all the time. Big government doesn’t work any more. We need to change that. We need to go back to self-sufficiency; we need to go back to citizens participating in government.
We need to go back to Economics 101 where you invest to make money, save money. The gold companies that have the business model of print shares and drill, print shares and drill—those guys aren’t going to succeed. But the guys who have producing assets and real stories, they’re going to succeed beyond their wildest imagination.
We need to kill the Federal Reserve System and go back to honest money. That’s 90% of our problem right now. We are all playing at investing with Monopoly money backed by nothing. It’s about as smart as you sitting down at a high stakes poker game, you have a wad of $20 gold pieces and everyone else is playing with their Mobil Oil credit card. Those fools will bet on anything, it’s not real money.
TGR: Can they perform in a falling financial market?
BM: Of course.
TGR: Assuming gold is rising.
TGR: Do you see think a lot of these juniors have bottomed? A lot of the producers have doubled off of bottoms.
BM: Yes, they have actually—they bottomed in October. If you go back to what I was saying back then, I said we were at a bottom. They had definitely bottomed. The HUI has doubled since then and no one noticed.
The general stock market is going to be good until maybe January or February. But it’s going to get far worse after that. We have some real problems that will be surfacing between now and then. But there’s an enormous amount of money sitting on the sidelines waiting to go somewhere safe. When people realize that resource stocks are the only safe haven, they’re going to go up more than anybody can imagine.
So, there are two things I would do with new money. First of all, gold and silver serve as an insurance policy against chaos. If you cannot put your hands on some physical gold, physical silver, it’s like living without an insurance policy. When you need food, if you don’t have gold or silver, you’re going to be a bit shocked. Second of all as far as an investment program, beyond the insurance policy, you want to be in real assets. That’s gold or silver or energy producers or near-term producers, or companies with a good business model.
TGR: Any names you could share with us?
BM: Look at the recent Haywood Securities report, "Junior Mining: Report on Cash Sustainability." Now, 96 companies currently traded at discount to their last reported net working capital. This is the greatest opportunity to invest that I have ever read or heard about; it’s absolutely unimaginable. It’s not going to last very much longer, but stocks could move up. The really bad gold stocks are going to move up 500%.
TGR: You mentioned that you looked at gold and silver as an insurance policy and recommend investing in real assets. Do you have a recommendation of a percentage of the portfolio that people should be holding in these? How much cash should they keep for future opportunities?
BM: Ah, very little. Cash is going to be the most dangerous thing you can invest in. Cash, T-bills, T-bonds are going away; they’re going to be worth zero. You’re going to walk into a bank one day and your ATM machine is not going to work, and your cash is going to be no good. I would think two to three months' living expenses, if you can do that in cash or silver, would be a very high comfort level. That percentage will change depending on what people have. Everybody—I really want to emphasize that—everybody needs to have some physical gold or silver.
TGR: Bob, you don’t see that we’re going to get this hyperinflation kicking in or it’s going to be so short, it won’t matter?
BM: Hyperinflation is starting to kick in now. I think you’re going to see it turn shortly. The government has been flooding the system with money and in short order it’s going to try to find a safe haven. Here’s what to look for. If you take a look at a chart right now, the 10-year, 30-year bonds have gone curve linear. They’re going straight up to the moon. Any time a market does that, it’s about to crash. When the bond market crashes, it’s going to be 15 on the Richter scale. It’s going to be enormous. It’s far more dangerous than the stock market crashing. When the bond market crashes, the hyperinflation starts.
TGR: And what’s your timeline on that? You were saying before, January or February?
BM: The bond market is literally going to start crashing any day now. I mean it’s very, very soon. I think that the stock market is good through January or February. I think the resource market will start up in an explosive way literally in a few weeks or so. It’s actually going up now. If you go back the last month or six weeks, it’s gone up a lot more than anybody would believe. Everybody thinks, “Well, my gold stocks are all down, I’m going to lose money hand over fist.” But they’re actually 50% better off now than they were in October.
TGR: Bob, earlier you mentioned investing in real assets. You said gold and silver and energy producers. That’s a pretty broad-based statement; could you give us an idea of what you mean when you say energy producers?
BM: Coal producers, oil producers, natural gas producers—energy is absurdly cheap now; it was absurdly expensive at $147. You can buy energy producers really cheaply, and I have written up a number of them on 321energy.com. I like anything real, anything that’s based on Economics 101. We’re going to take something of value and we’re going to increase its value, and we’re going to sell it to the public for a profit. That’s just a really good business model.
Here’s what I want to emphasize, and what’s important to get across—I don’t want to sound like I’m totally negative because I’m not totally negative. The worse it gets in the United States, the more impetus there will be to say, “Hey, what caused this in the first place? And what can we do to prevent it in the future?” And the answer to that is quite simple. We got off the gold standard in 1933 and in 1971, and that let government grow totally out of control. We need to rein government in; we need to go back to government of the people, by the people, and for the people. The way to do that is to go back to a gold and silver based currency. Once we do that we can start investing with some kind of common sense.
TGR: So the good news is that through all this chaos there will be some change in the way the government operates?
BM: Government will be much smaller; I think that any rational American can look at big government and say, “Hey, wait a minute. This doesn’t work.” And the funny thing is it’s not because I’m a liberal or I’m a conservative. I’m not sure there is any such thing as a perfect liberal or a perfect conservative, even though we act like they’re two totally different things. Big government doesn’t work; we need to go back to Economics 101 and only spend the money that you earn.
TGR: OK, other than getting mentally ready, getting into gold and silver and real assets, do you have any other thoughts on where to put our cash if we have any cash right now? What about other commodities, such as food commodities?
BM: Absolutely. I believe in peak oil, and peak oil is an analog of peak food. So, it requires X number of calories of energy to produce X number of calories of food, so when you run out of cheap energy, you run out of cheap food. Americans are going to be very angry. We have a very dangerous system in the United States where we essentially have a day and a half’s worth of food in our food stores. It’s a just in time now system. And it’s very vulnerable to civil disorders.
TGR: Is there an investment play within the food component?
BM: I think anything in food. Strangely enough, what I like is fertilizers. Fertilizers are a real cheap way of betting on food. Some of the big food companies, like R Gill, are just as corrupt as everybody in Washington, everybody in Wall Street, so I can’t recommend them. I don’t know that big food stocks are good, but maybe equipment manufacturers would be a good bet.
TGR: Bob, do you think there’s any gold in Fort Knox?
BM: That’s a really good question. I hope there is. But I don’t know. The really interesting thing is nobody in the government has ever even pretended that they might do something with it. If it was me, I’d go count the bars; I’d figure out who owns them and I’d come up with some kind of currency tied to gold, you know—1 gram notes, and 5 gram notes and 10 gram notes. I think mathematically there probably isn’t, but I don’t know. Nobody knows.
TGR: And there’s no accountability?
BM: Ah, are you kidding? George Bush is president of the United States.
TGR: Yes, but soon he won’t be. You know, I’ll write a letter to Obama and ask him. Well, Bob, as usual, it’s always great to do these interviews. We appreciate it.
Bob Moriarty and his wife, Barb, launched 321gold.com as a private website seven years ago, when they were convinced gold and silver were at a bottom and wanted to help others understand what they needed to know about investing in resource stocks. Since then, they’ve introduced a second resource site, 321energy.com. Bob travels to dozens of mining projects a year. He was one of the first analysts to write about NovaGold, Northern Dynasty, Silver Standard, Running Fox and YGC Resources, among others. Prior to his Internet career, Bob was a Marine F-4B pilot at the age of 20 and a veteran of over 820 missions in Viet Nam. Becoming a Captain in the Marines at 22, he was one of the most highly decorated pilots in the war.
Visit The GOLD Report
The GOLD Report is Copyright © 2008 by Streetwise Inc. All rights are reserved. Streetwise Inc. hereby grants an unrestricted license to use or disseminate this copyrighted material only in whole (and always including this disclaimer), but never in part. The GOLD Report does not render investment advice and does not endorse or recommend the business, products, services or securities of any company mentioned in this report. From time to time, Streetwise Inc. directors, officers, employees or members of their families, as well as persons interviewed for articles on the site, may have a long or short position in securities mentioned and may make purchases and/or sales of those securities in the open market or otherwise.
The Gold Report: Bob, what do you think of the Fed’s latest move—cutting to a flexible zero to a quarter rate? Where do you see us going?
Bob Moriarty: We are to the point where we are about 14 feet from going over the edge of Niagara Falls. We haven’t gone over the edge yet; we haven’t gone to a total collapse. We don’t have riots in the streets; we don’t have a revolution. That’s coming; that’s about two to three months off.
Here’s what we’ve got: the Fed has committed to $8.5 trillion of taxpayers’ money to bail out the worst run companies and banks. It hasn’t worked. Now, they’re at a 0% to .25% on the Fed Funds rate for funds for banks, which means if you go down and you pay $100,000 for a T-bill for 90 days, your return is zero, which is to imply that there is zero risk to investing with the government. Anybody who actually believes that is going to be in for a real shock in the first quarter of next year.
GM has lost has lost $80 billion dollars in the last four years. They’re burning through $2 billion a month when everything is going well. Their sales are down 37% in November; the mathematical probability of GM surviving is zero. But we’re going to pour more taxpayer money down that hole. AIG's also turned into the proverbial black hole. I would think that at $300 billion or $400 billion or $500 billion or $600 billion, somebody’s going to wake up and say, “You know, we’re losing a lot of money here.”
TGR: It’s getting to be real money at that point.
BM: What we have done is guaranteed hyperinflation in the United States. We have guaranteed the destruction of the United States. We will have riots starting in the first quarter of next year; we will default by the summer of 2009.
TGR: Default on how many of the bonds? All? Or just some?
BM: 100%. The US government is going to default. Treasuries, Fannie Mae, Freddie Mac, the whole lot. It’s the end of empire. The United States government will not exist in its current form a year from now.
TGR: When you say “its current form,” what form will it take?
BM: I don’t know. It’s a really good question. I’m sure it will be a total state of chaos. I mean we’ve never been here. I think the analogy of the Soviet Union is probably the closest; we could break up into a series of little fiefdoms. But here’s what’s important to understand—the United States government has failed at every single level. It is too big; it is too unwieldy; it doesn’t work.
TGR: So, what does it mean? We’ve got impending chaos in the United States—and the financial markets will continue to go downward. Are we talking globally or U.S.?
BM: U.S. primarily, but globally because the U.S. is so important. The U.S. is the linchpin right now, but the rest of the world is going to have to learn to get by without the United States. What George Bush and Dick Cheney have done is essentially destroyed the United States; they have bankrupted the country. We are going to end up having our troops march out of Iraq to the nearest border because we can no longer afford to pay for them. We’re going to go into Zimbabwe-type inflation where they’re printing off $200 million dollar bills to buy a loaf of bread.
TGR: Other than moving to a nice island in the Caribbean, what does an investor or a resident of the U.S. do?
BM: You have to prepare; first of all, it’s important to prepare mentally and that means doing some education. Second, you don’t want to be in debt. You don’t want to be buying real estate. You don’t want to be taking any chances financially whatsoever. You want to be investing in real resources: good solid producing gold companies or silver companies or energy companies. You want to really hunker down.
TGR: If the financial markets continue to get clobbered, I would assume the gold equity stocks would continue to get clobbered?
BM: I don’t think they will. Here’s what is going to happen. There is actually a lot of money sitting on the sidelines. I’ve heard there's billions of dollars waiting to be invested in resource stocks. Resource stocks are selling for 5 cents or 10 cents on the dollar; that’s not going to last for very long.
What I want to get across to everybody is and it’s very important, is that when you go through chaos, the worse it gets, the more inclined you are to solve it. There are some easy solutions to this financial situation in the United States.
First of all, we downsize; we stop spending all this money at the federal level; we stop spending money at the state level. We end up with a much smaller government that isn’t trying to make every decision for every person all the time. Big government doesn’t work any more. We need to change that. We need to go back to self-sufficiency; we need to go back to citizens participating in government.
We need to go back to Economics 101 where you invest to make money, save money. The gold companies that have the business model of print shares and drill, print shares and drill—those guys aren’t going to succeed. But the guys who have producing assets and real stories, they’re going to succeed beyond their wildest imagination.
We need to kill the Federal Reserve System and go back to honest money. That’s 90% of our problem right now. We are all playing at investing with Monopoly money backed by nothing. It’s about as smart as you sitting down at a high stakes poker game, you have a wad of $20 gold pieces and everyone else is playing with their Mobil Oil credit card. Those fools will bet on anything, it’s not real money.
TGR: Can they perform in a falling financial market?
BM: Of course.
TGR: Assuming gold is rising.
TGR: Do you see think a lot of these juniors have bottomed? A lot of the producers have doubled off of bottoms.
BM: Yes, they have actually—they bottomed in October. If you go back to what I was saying back then, I said we were at a bottom. They had definitely bottomed. The HUI has doubled since then and no one noticed.
The general stock market is going to be good until maybe January or February. But it’s going to get far worse after that. We have some real problems that will be surfacing between now and then. But there’s an enormous amount of money sitting on the sidelines waiting to go somewhere safe. When people realize that resource stocks are the only safe haven, they’re going to go up more than anybody can imagine.
So, there are two things I would do with new money. First of all, gold and silver serve as an insurance policy against chaos. If you cannot put your hands on some physical gold, physical silver, it’s like living without an insurance policy. When you need food, if you don’t have gold or silver, you’re going to be a bit shocked. Second of all as far as an investment program, beyond the insurance policy, you want to be in real assets. That’s gold or silver or energy producers or near-term producers, or companies with a good business model.
TGR: Any names you could share with us?
BM: Look at the recent Haywood Securities report, "Junior Mining: Report on Cash Sustainability." Now, 96 companies currently traded at discount to their last reported net working capital. This is the greatest opportunity to invest that I have ever read or heard about; it’s absolutely unimaginable. It’s not going to last very much longer, but stocks could move up. The really bad gold stocks are going to move up 500%.
TGR: You mentioned that you looked at gold and silver as an insurance policy and recommend investing in real assets. Do you have a recommendation of a percentage of the portfolio that people should be holding in these? How much cash should they keep for future opportunities?
BM: Ah, very little. Cash is going to be the most dangerous thing you can invest in. Cash, T-bills, T-bonds are going away; they’re going to be worth zero. You’re going to walk into a bank one day and your ATM machine is not going to work, and your cash is going to be no good. I would think two to three months' living expenses, if you can do that in cash or silver, would be a very high comfort level. That percentage will change depending on what people have. Everybody—I really want to emphasize that—everybody needs to have some physical gold or silver.
TGR: Bob, you don’t see that we’re going to get this hyperinflation kicking in or it’s going to be so short, it won’t matter?
BM: Hyperinflation is starting to kick in now. I think you’re going to see it turn shortly. The government has been flooding the system with money and in short order it’s going to try to find a safe haven. Here’s what to look for. If you take a look at a chart right now, the 10-year, 30-year bonds have gone curve linear. They’re going straight up to the moon. Any time a market does that, it’s about to crash. When the bond market crashes, it’s going to be 15 on the Richter scale. It’s going to be enormous. It’s far more dangerous than the stock market crashing. When the bond market crashes, the hyperinflation starts.
TGR: And what’s your timeline on that? You were saying before, January or February?
BM: The bond market is literally going to start crashing any day now. I mean it’s very, very soon. I think that the stock market is good through January or February. I think the resource market will start up in an explosive way literally in a few weeks or so. It’s actually going up now. If you go back the last month or six weeks, it’s gone up a lot more than anybody would believe. Everybody thinks, “Well, my gold stocks are all down, I’m going to lose money hand over fist.” But they’re actually 50% better off now than they were in October.
TGR: Bob, earlier you mentioned investing in real assets. You said gold and silver and energy producers. That’s a pretty broad-based statement; could you give us an idea of what you mean when you say energy producers?
BM: Coal producers, oil producers, natural gas producers—energy is absurdly cheap now; it was absurdly expensive at $147. You can buy energy producers really cheaply, and I have written up a number of them on 321energy.com. I like anything real, anything that’s based on Economics 101. We’re going to take something of value and we’re going to increase its value, and we’re going to sell it to the public for a profit. That’s just a really good business model.
Here’s what I want to emphasize, and what’s important to get across—I don’t want to sound like I’m totally negative because I’m not totally negative. The worse it gets in the United States, the more impetus there will be to say, “Hey, what caused this in the first place? And what can we do to prevent it in the future?” And the answer to that is quite simple. We got off the gold standard in 1933 and in 1971, and that let government grow totally out of control. We need to rein government in; we need to go back to government of the people, by the people, and for the people. The way to do that is to go back to a gold and silver based currency. Once we do that we can start investing with some kind of common sense.
TGR: So the good news is that through all this chaos there will be some change in the way the government operates?
BM: Government will be much smaller; I think that any rational American can look at big government and say, “Hey, wait a minute. This doesn’t work.” And the funny thing is it’s not because I’m a liberal or I’m a conservative. I’m not sure there is any such thing as a perfect liberal or a perfect conservative, even though we act like they’re two totally different things. Big government doesn’t work; we need to go back to Economics 101 and only spend the money that you earn.
TGR: OK, other than getting mentally ready, getting into gold and silver and real assets, do you have any other thoughts on where to put our cash if we have any cash right now? What about other commodities, such as food commodities?
BM: Absolutely. I believe in peak oil, and peak oil is an analog of peak food. So, it requires X number of calories of energy to produce X number of calories of food, so when you run out of cheap energy, you run out of cheap food. Americans are going to be very angry. We have a very dangerous system in the United States where we essentially have a day and a half’s worth of food in our food stores. It’s a just in time now system. And it’s very vulnerable to civil disorders.
TGR: Is there an investment play within the food component?
BM: I think anything in food. Strangely enough, what I like is fertilizers. Fertilizers are a real cheap way of betting on food. Some of the big food companies, like R Gill, are just as corrupt as everybody in Washington, everybody in Wall Street, so I can’t recommend them. I don’t know that big food stocks are good, but maybe equipment manufacturers would be a good bet.
TGR: Bob, do you think there’s any gold in Fort Knox?
BM: That’s a really good question. I hope there is. But I don’t know. The really interesting thing is nobody in the government has ever even pretended that they might do something with it. If it was me, I’d go count the bars; I’d figure out who owns them and I’d come up with some kind of currency tied to gold, you know—1 gram notes, and 5 gram notes and 10 gram notes. I think mathematically there probably isn’t, but I don’t know. Nobody knows.
TGR: And there’s no accountability?
BM: Ah, are you kidding? George Bush is president of the United States.
TGR: Yes, but soon he won’t be. You know, I’ll write a letter to Obama and ask him. Well, Bob, as usual, it’s always great to do these interviews. We appreciate it.
Bob Moriarty and his wife, Barb, launched 321gold.com as a private website seven years ago, when they were convinced gold and silver were at a bottom and wanted to help others understand what they needed to know about investing in resource stocks. Since then, they’ve introduced a second resource site, 321energy.com. Bob travels to dozens of mining projects a year. He was one of the first analysts to write about NovaGold, Northern Dynasty, Silver Standard, Running Fox and YGC Resources, among others. Prior to his Internet career, Bob was a Marine F-4B pilot at the age of 20 and a veteran of over 820 missions in Viet Nam. Becoming a Captain in the Marines at 22, he was one of the most highly decorated pilots in the war.
Visit The GOLD Report
The GOLD Report is Copyright © 2008 by Streetwise Inc. All rights are reserved. Streetwise Inc. hereby grants an unrestricted license to use or disseminate this copyrighted material only in whole (and always including this disclaimer), but never in part. The GOLD Report does not render investment advice and does not endorse or recommend the business, products, services or securities of any company mentioned in this report. From time to time, Streetwise Inc. directors, officers, employees or members of their families, as well as persons interviewed for articles on the site, may have a long or short position in securities mentioned and may make purchases and/or sales of those securities in the open market or otherwise.
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