Use access key #2 to skip to page content.

XMFSinchiruna (27.99)

Bernanke Ignites the Gold and Silver Rocket

Recs

48

November 08, 2010 – Comments (18) | RELATED TICKERS: RBY , AXU , CDE

Ladies and gentlemen, we have a confirmed liftoff.

As the only currency not subject to intentional debasement or counterparty risk, gold continues to serve its historic role as the ultimate barometer for impairment among fiat currencies like the dollar. Bernanke's predecessor Alan Greenspan has called gold "the canary in the coal mine," stating that "gold still holds reign over the financial system as the ultimate source of payment."

Over the weekend, World Bank president Robert Zoellick ruffled more than a few Keynesian feathers when he championed a new global currency regime that would "consider employing gold as an international reference point of market expectations about inflation, deflation and future currency values."

.....

On the heels of Bernanke's unveiling of the "QE2" money-printing blitz, I see strong potential for gold and silver prices to continue through near-term price targets of at least $1,500 and $30 per ounce, respectively, before the onset of another inevitable correction. My long-term price targets for $2,000 gold and $50 silver remain unchanged since 2007, though frankly they begin to appear grossly conservative the more this disappointing forward trajectory of the U.S. dollar comes into clear view.

.....

Those searching for outsized gains that have yet to materialize may wish to give gold explorer Rubicon Minerals (AMEX: RBY) a close and timely inspection. Rubicon is a top-ten holding of the new ETF, and has been discovering ultra-high-grades of gold within the F2 gold system of its Phoenix project in Red lake, Ontario, throughout the several years that I have held the explorer's shares. At long last, the company is preparing to release an official resource estimate for the F2 deposit sometime in November, and I suspect the market will be pleased with the scale of the deposit once revealed.

.....

Coeur remains somewhat choked by debt and royalty obligations, but a considerable growth spurt combined with rapidly declining costs signals a robust recovery to this embattled and Foolish shareholder. With nearly 270 million ounces of silver in reserves, and another 180 million ounces in measured and indicated resources (not to mention 2.9 million ounces of gold in reserves), I still detect a strong pulse in this hitherto underperforming miner. As an example of the operational improvements under way at Coeur, the company managed to abruptly reduce costs at its Palmarejo mine from $10.78 per ounce in the second quarter, to an attractive $0.15 per ounce in the third quarter.

.....

Bernanke Ignites the Gold and Silver Rocket Surge

.....

Also out recently:

Light at the End of the Dry Bulk Tunnel

Yamana Gold is Preparing for Liftoff

Look Beyond Newmont's Gold

Taseko's Dead End to Prosperity

Even Coal's Laggards are Generating Heat

The View From Both Ends of Cliffs

Gold Miners Face a Terrific Problem

Heavy Lifting from Heavy Haulers

The Two-Tiered Treasure of Teck

 

Thank you as always for your readership, and for dropping your comments and recs wherever you deem appropriate. :)

Oh yeah, and you're welcome for Great Panther. ;)

Today was epic.

 

 

 

18 Comments – Post Your Own

#1) On November 08, 2010 at 7:48 PM, dbjella (< 20) wrote:

+1 and a hearty thank you!

Report this comment
#2) On November 08, 2010 at 7:56 PM, ikkyu2 (99.39) wrote:

I'm hearing Leonard Cohen's "Everybody Knows" as the soundtrack to this post.

Report this comment
#3) On November 08, 2010 at 8:08 PM, BillyTG (29.78) wrote:

+1

happy to see ridiculous daily gains in my portfolio the last few days.  Bittersweet when you realize why those gains are happening...and to think, there is still a long way to go.

Report this comment
#4) On November 08, 2010 at 8:41 PM, 100ozRound (29.72) wrote:

I owe you an immense debt of gratitude Sinch!  Thank you, thank you, thank you!  Recs for life!

BTW I see you haven't picked PSLV yet

Report this comment
#5) On November 08, 2010 at 9:14 PM, workfor (< 20) wrote:

Thanks Sinch! I've made more money the last three trading days than I will make all year with my business!

Being called a  gold bug doesn't seem so bad now does it folks!

P.S., Some time ago I got hooked up with a local silver investor/dealer who got rich during the last bull market in metals, and he believes silver will reach $100.00/oz this time around. If he is right, I can only imagine the price targets of the silver miners:)

Report this comment
#6) On November 08, 2010 at 9:31 PM, Valyooo (99.64) wrote:

Or the calls of silver miners

Thanks for great panther.  I dont have a lot of money, but 60% of a small amount is still nice.

Report this comment
#7) On November 08, 2010 at 10:52 PM, Momentum21 (96.83) wrote:

I thought I would leave some money on the table when selling SLW last month but I have to admit that I have some regrets. My theoretical double-up would be so close right now... : )

That would have been a lifetime of guilt-free latte's...at least...I wish I had not done the math...

Congrats man...I wish I had some Great Silver Panther as well...wow 

 

 

Report this comment
#8) On November 08, 2010 at 11:14 PM, jsgant13 (99.17) wrote:

sinch - thanks for the great panther rec - i own 5k shares with a cost basis just under a buck. now that it has seen such a strong run up, i am faced with the "problem" of not knowing when to sell since I don't feel comfortable evaluating the long term prospects of the company. do you think this is still a hold in the near term or are you taking profits here? thanks again 

Report this comment
#9) On November 08, 2010 at 11:14 PM, jsgant13 (99.17) wrote:

sinch - thanks for the great panther rec - i own 5k shares with a cost basis just under a buck. now that it has seen such a strong run up, i am faced with the "problem" of not knowing when to sell since I don't feel comfortable evaluating the long term prospects of the company. do you think this is still a hold in the near term or are you taking profits here? thanks again 

Report this comment
#10) On November 08, 2010 at 11:51 PM, Momentum21 (96.83) wrote:

anyone notice the 3.81 print for Great Panther that CAPS and Google finance picked up? A few CAPS members started green thumbs at that level...

Report this comment
#11) On November 09, 2010 at 8:06 AM, XMFSinchiruna (27.99) wrote:

jsgant13

The strength of this move in GPRLF is born out of a two-year plus period when the stock was all but paralyzed beneath $1 through multiple exploration successes, production increases, margin expansion, and a resounding return to profitability. A quick double or triple from the lows, up towards this $2 area is merely a reawakening. The stock is nowhere even close to realizing its potential. 

You have witnessed GPR's reawakening. I think you may wish to see what it can do after it has its coffee and breakfast. I have tried to remain disciplined about maintaining a 10% cash balance in my account, and so have shaved off small numbers of shares of many successful names in recent days, but I have not contemplated taking any action on this stock.It has become my second-largest equity holding after SLW.

I think the stock could reach $10 if it were left alone to grow into its full potential amid a silver price ascent that surpasses my ultra-conservative $50 target, but it's very likely to be acquired well before reaching such a price.

Report this comment
#12) On November 09, 2010 at 8:58 AM, EnigmaDude (98.01) wrote:

As a former "doubting Thomas" I too have to thank you for introducing me to Great Panther.  I also would like to admit that I incorrectly assumed a gold bubble was forming and I now see the error in my call.

I also saw that great panther opened at $3.81 yesterday before quickly retreating.  I sold half my shares for a nice profit, but now I am thinking I should buy more.  Perhaps I will look at RBY instead.  I held shares of RBY a couple years ago but it never took off.  Maybe now it will...

Thanks again for all your efforts in educating and enlightening us Fools!

Report this comment
#13) On November 09, 2010 at 9:23 AM, XMFSinchiruna (27.99) wrote:

EnigmaDude

$3.81 was a real tick? Can you or someone confirm?

I see no evidence of it in the actual TSX-listed shares. Perhaps it was a short squeeze versus manipulation of pink-sheet "shares".

http://tmx.quotemedia.com/charting.php?qm_page=24302&qm_symbol=GPR

If it was, it was the short squeeze of the year, and it means the underlying shares are likely to revisit the mark before long.

But my yahoo chart of the pink-sheet listing doesn't show the bump.

http://finance.yahoo.com/echarts?s=GPRLF.PK+Interactive#chart1:symbol=gprlf.pk;range=5d;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

Looks like more black-box funny business to this Fool. 

Google shows $3.81 as the 52-week high, but the spike is not depicted on the chart.

I would strongly encourage folks to contact the SEC with your inquiries. Stuff like that is just not supposed to happen.

 

Report this comment
#14) On November 09, 2010 at 9:35 AM, outoffocus (23.66) wrote:

+1

happy to see ridiculous daily gains in my portfolio the last few days.  Bittersweet when you realize why those gains are happening...and to think, there is still a long way to go.

Billy, I'm in perfect agreement. I used to *pop champagne* when PMs would go up like this, now I feel slightly sad because I can see the simultaneous inflation thats happening thanks to helicopter Ben. 

Report this comment
#15) On November 09, 2010 at 9:39 AM, Gonzhouse (65.00) wrote:

Sinch, not only do I owe you Great Panther but Silver Wheaton as well.  A recent Seeking Alpha article has forecast SLW at the $100 mark, as you have previously predicted. Now, if IVN can follow Great Panther, I can start construction on the House That Sinch Built!  Many, many thanks.

Report this comment
#16) On November 09, 2010 at 9:56 AM, XMFSinchiruna (27.99) wrote:

Gonzhouse

IVN is a long-term play, as you're essentially waiting for them to construct the mine, but it's a successor to FCX, and so worth waiting for.

.......

Here are some of my ramblings from another blog post:

Thanks for an entertaining post. :) I am more understanding of the trepidations of those on the sidelines of gold and silver than some might imagine. I don't envy the position of someone on the sidelines today. It's very scary getting into an asset class that's this hot.

I encourage you to start asking around among your friends and family whether they own stakes in gold or silver. I think you'll find there is a massive disconnect between the amount of media attention the metals are receiving, and the actual prevalence of the asset class among allocations of retail investors.

Take it from someone who does understand gold. We are a world away from any terminal stage of this secular bull market. This isn't 1980, it's not the tech bubble, and really it's not like anything we've seen in our lifetimes. If you believe that policy responses to economic crisis will continue to be hyper-accommodative, then continued momentum for silver and gold is a rational corrollary. If you believe the Fed is solving our problems, then you'd be best to steer clear, but if you believe as I do that it is just kicking our problems down the road and permitting them to grow stronger still, then gold and silver have a place in your portfolio. Plain and simple. :)

And yes, for someone just mulling entry into the space today, Yamana Gold is a rather safe vehicle given the very limited downside risk and tremendous upside potential. With the gold:silver ratio approaching 50, much of the relative advantage of silver over gold has been erased by silver's recent surge. Whereas a few months ago I advocated a clear focus on silver over gold, I would now recommend a more balanced 50:50 mix of the 2 metals ... or perhaps 60:40 silver to gold. I think I'm presently 70:30, but I'm likely to shift towards 60:40 over the coming weeks.

There are a few battered names that are deserving of serious consideration at this juncture ... stocks that have been left out of the recent surge entirely. Gammon Gold is one (GRS). Northgate Minerals (NXG) is another.

For more pumped-up returns, that new gold explorers ETF looks sweet (GLDX).

So there you have it, sideliners. Dip a toe in the water, even just a baby toe if your conviction is minimal. Gold is going to $2,000 and higher, with or without you. Silver is going to $50 and higher, with or without you. I, for one, would rather it be with you so we can all look back together with the satisfaction of an adaptation well executed.

Fool on!

 

Report this comment
#17) On November 09, 2010 at 10:22 AM, kdakota630 (29.86) wrote:

Actually, thanks again about Great Panther.

As much as you went on about SLW I didn't feel comfortable putting money into it because it was a U.S. stock (not that it would've mattered in hindsight).

I put money into Great Panther as I can buy it on the TSX as well as SBT.UN (Canadian silver version of CEF) and am doing well on both.  My only regret is not doing both sooner.

Report this comment
#18) On November 09, 2010 at 2:18 PM, jsgant13 (99.17) wrote:

sinch - thanks for your response and again for the heads up on great panthers - it has had an interesting trading day today. i'm holding on...

Report this comment

Featured Broker Partners


Advertisement