With continued strong investment demand for physical gold in the face of heightened macro uncertainty and unprecedented, globally-coordinated monetary stimulus and a US dollar that will continue its path lower, the best performing assets at present are gold, emerging market equities denominated in local currencies, and commodity related stocks. [Let me explain why that is the case.] Words: 560
So says Matthew T. Schroeder (www.anomalousinvestments.com) in an article* that highlights aspects of a report from Paul Tudor Jones of Tudor Investment Corporation which Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money!), has further edited ([ ]), abridged (…) and reformatted (some sub-titles and bold/italics emphases) below for the sake of clarity and brevity to ensure a fast and easy read. The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement.
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Schroeder goes on to say, in part:
Jones believes that the US dollar will continue its path lower as global flows seek high yielding assets and sovereign reserve managers diversify their growing US dollar-based reserves. Reserve accumulation and diversification trends will be persistent and mutually reinforcing with the direction of the dollar.
Jones maintains that during times of overt monetization, hyperinflation, or when questions arise about the stability of the banking system, gold prevails as a more reliable store of value.
Compared to the long-run average, gold [still] appears to be [relatively] cheap. Gold’s value should increase as its scarcity relative to printed currencies increases.
On the demand side, much of the recent move to record prices in gold reflects continued strong investment demand for physical gold in the face of heightened macro uncertainty and unprecedented, globally-coordinated monetary stimulus.
Gold Price Outlook
In Jones’ opinion…the scope for increased investment demand [in gold] over the coming years will continue much stronger than the potential for new supply. As a result, incremental new demand must buy gold from current holders.
With a macro backdrop that suggests gold is undervalued, the transfer of gold from current holders to its new owners will likely not occur at, or near, current prices.
Summary & Implications
The views of Tudor Investment Corporation are similar to those heard…from other prominent hedge fund managers and institutional money managers such as John Paulson of Paulson & Co., and David Einhorn of Greenlight Capital who are all of the opinion that, in this environment, investments in liquid gold securities and exchange-traded funds are, and will continue to be, in high demand…[In addition,] because the investable gold sector is relatively small, and because there is a scarcity of quality, liquid, gold mining companies, some are even willing to venture into Africa-focused miners…
In summary, in The Great Liquidity Race, the smart money is clearly increasingly bullish on the prospects for gold.
*http://www.anomalousinvestments.com/documents/Paul_Tudor_Jones_The_Great_Liquidity_Race.pdf (Matthew T. Schroeder is the President of Anomalous Investments, an independent advisory service focused on uncovering select, under-researched Special Situations in gold, silver, oil, natural gas and agriculture.)
The technical situation is ultra-bullish for both gold and gold stocks. Sentiment indicators…continue to show [that] the dollar is poised for a serious decline and the MACD on the gold chart is giving one of the most powerful buy signals in the history of the bull market. The GDX should reach $75 a share by year-end and gold should push to new highs in the $2000 area by January of 2012 [while silver] could possibly be the best investment opportunity available to investors for many years to come! [Let me explain and back up my comments with an array of charts.] Words: 781
Psychologists tell us that there are five stages of grief over loss of whatever kind, usually death, or breaking up with a loved one, which are: denial, anger, bargaining, depression, acceptance. I’ve applied these to the loss of the dollar, as I see most people today are still stuck in denial, and here’s how to deal with that. Words: 1100
If you concur with the 159 analysts (see below) that maintain that physical gold is going to go parabolic in price in the next few years to $3,000, $5,000 or even $10,000 or more then you should seriously consider buying physical silver. Why? Because the historical gold:silver ratio is so way out of wack that silver should appreciate much more than gold as it goes parabolic in the years to come. Indeed, silver could easily reach $100 – $200 per troy ounce, maybe even $300 and conceivably in excess of $400 depending on how high gold goes. The aforementioned may be hard to believe but an analysis below of the historical price relationship between silver and gold suggests that such will most likely occur if gold does, indeed, go parabolic. Take a look. Words: 1423
You have no doubt read countless articles on the price of gold costing x dollars per “troy ounce” or perhaps just x dollars per “ounce” but the difference between the two measurements is significant. For that matter, what’s the difference between a 24 karat gold ring and an 18 karat gold ring? What’s the difference between a .75 and a 1.0 carat diamond? Let me explain. Words: 963
143 analysts maintain that gold will eventually reach a parabolic peak price of at least $3,000/ozt. before the bubble bursts. Of those 143 a total of 103 see gold achieving a price of at least $5,000/ozt. and 20 predict that gold will reach a parabolic peak price of $10,000 per troy ounce or more. Take a look here at who is projecting what, by when and why. Words: 745
Don’t own any gold or silver yet? New to the precious metals? Regardless whether you are a novice or seasoned veteran, the following seven points provide essential background information you can use to help determine whether the precious metals are right for you. Words:1311