Posted on 03/21/2009 5:54:42 PM PDT by djf
It didn’t really spring out of nowhere. Places offering to buy your gold have been around for a while. They’ve taken a higher profile lately, but that’s just usual vulture profit of bad times. The commercials are kind of funny, but that sad pathetic funny.
If someone touts a stock to you and you check it out and see it's traded in Vancouver, run don't walk in the opposite direction.
Anyone wanting to own mining issues would be best advise IMHO to stick with substantial companies with capitalizations north of half a billion dollars. It's going to take financial stoutness to withstand the storms of the next two, three, or four years. We haven't begun to see the attrition that protracted deflation and miasma can impose on supposedly substantial, healthy companies.
Compare, as an exercise, two near-neighbors: Coeur D'Alene (CDE) and Hecla Mines (HL) are down-the-street neighbors, but CDE is considerably bigger than HL. Also, CDE produces a higher yield of gold in their mostly-silver production (with some base metals, of course), almost 20% gold. HL is much more purely a silver miner because of the slighter gold yield. Which will be good when silver starts to catch up with gold. You can follow the multiyear trend of gold to silver either by going to StockCharts.com and doing a chart of GLD:SLV or SLV:GLD (their free charts only go back three years), or you can go back several years and compare a silver miner like PAAS or HL to a gold miner like GG or GOLD or KGC on BigCharts.com and use the Advanced Charting option and pull up "% Compare" in the attribute panel at the left of the chart, which will give you a strip-chart at the bottom of the chart which will flatten on the asset/symbol you select, and show the price of the other as a function of the percentage of the reference issue. That works pretty well, too.
Silver and platinum have wider industrial applications, so they aren't as pure plays on the fiat currencies as is gold.
Suggest reading up on Goldseek.com, anything by the Aden sisters, also FinancialSense.com and Minyanville.com. You will find additional useful links to other gold sites on Goldseek.com, but keep in mind that gold is a bit of a niche enthusiasm with a certain tinfoiler appeal that tends to color things. The wider-interest trading sites that also follow gold, like FinancialSense and Minyanville, tend to offer a more anchored view. I'd regard advice coming from the big brokerages and investment banks with suspicion; and of course USG and other paper issuers are mortally hostile to gold. I would view any statement by the Fed on the subject of gold as suspect from the git-go.
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