Gold

The spike in gold/silver mining stocks convinced a lot of people that a new bull market had begun but last week's brutal smack-down scared the hell out of many of the same folks. The latest commitment of traders (COT) report, however, implies that we should all relax. Things are playing out pretty much according to a script that's been in place for decades - and which points to happy times by early next year. Let me be more explicit.

Several analysts in favour of gold are predicting a spike to come in the precious metal’s price. They base this prediction on several arguments but, as far as I’m concerned, their arguments won’t be enough to push gold up toward new heights. There are two other elements that need to come into play, and we’re starting to see them.

Don't miss the `forest` for the `trees` when looking for a clear trend in gold prices and market activity. Here are some of those `trees` to consider - and which have some analysts predicting gold prices per ounce as high as $10,000 (Jim Rickards) to $12,000 (James Turk).

Given the magnitude of the rally in gold year-to-date, many are questioning whether now is a good time to sell some or all of their holdings in the precious metal. From my perspective, however, I would be reluctant to abandon the asset class because it plays an important role in a portfolio.

If there is a business sector or financial asset class that has outperformed gold in the last 16 years, I can’t think of one yet how many people do you know who understand the necessity for owning gold and have actually acted on that knowledge?

If you want money and want to survive the massive economic failure that is destined to come, buy and hold gold and silver. The world has not been awash in debt more than it is now and that mushrooming debt cannot be sustained. What’s in your wallet? Words: 860

James Grant, editor of Grant's Interest Rate Observer, is urging investors to put their money in gold because he fears that the world will lose faith in central banks, or as he terms it “monetary management.”

It could be a whole new world for gold from today onwards when the traders and fund managers are fully back on track.

For as much as we favor - and expect - eventual higher prices for gold and silver, the charts do not indicate it will be any time soon. The following charts show you why.

Every investor should have a minimum of 10% of their portfolio in physical gold – coins or bars. Here's why.