I like gold. I like Am 1oz gold Eagles, Canadian 1 oz gold Mapleleafs and 1 oz gold Krugerrands but my guess is that gold will settle back to the $10.90 level and stay at that level all this year. Gold will spike but drift back to the $10.90 level (again, my guess.) I think that the real bargain now is silver. I like silver at this level of $15.38. I was posting last week to buy silver when spot was $14.50ish. I prefer 1 oz silver Canadian Mapleleafs and the 1oz silver Mexican Liberatad. Buy now is my advice to all. [get gold and silver quotes at kitco.com -only 10 min delay but don't buy from kitco; you'll get better quotes from local coin dealers /call 2-3 to compare quotes]
(just now,at 5:25 cst, I see spot silver at $15.66 oz / up 34 cents oz overnight)
I wish I agreed w/you on silver. This is of course what makes a market. I own plenty Ag and some gold, not as much as I would like but I suspect it is going a lot lower.
Why? Liquidity. More accurately, lack thereof. Worldwide margin call. CASH is the most hated asset, not gold, silver or stocks.
Gold is MUCH closer to its cost of production (COP) than silver. My research put the avg cost of producing gold maybe $950 - when oil was high. Crashing fuel lowers this cost, I would entertain $875.
What is the COP for silver?
I maintain it is ZERO. Yes, ZERO. Other than Hecla, there is no such thing as a silver mine. All silver is produced as a by-product of zinc & tin mining as a “freebie”. An Eagle or even a generic form has somewhat less than $1/oz seignorage, coining cost. Eagles, more like $3. Allegedly, they return the high coining cost on sale. Uh huh.
Gold is a traditional hedge against INflation. It is a complete PITA in deflation. It does terrible in deflation.
Just an opposing view. I bot most of my silver (other than what I originally acq’ed in 1965) at $4-5-7 in Y2K times. Bot for 5, sold for 6.5, bot for 6, sold for 7.75, etc etc and the best thing I ever did in Ag was to sell well over 200 lbs at $38.50.
When I started re-buying Ag, oil was about $20/bbl. I think it bottomed @ $18 in Y2K. Where is oil headed now?
The Fed has been trying with all its might to create inflation and trying with all its might to stave off DEflation, which is what I believe we face. It has not worked.
CASH Is an absolutely valid investment vehicle and when the SHTF, will buy a hell of a lot more than it does in booms or boomlets.
Just an opposing view. I believe gold is simply another commodity. It’s like permanent wheat. In deflation, commods get slaughtered.