adventurerneil (< 20)

adventurerneil's CAPS Blog

Gold and Silver - Undervalued & Soon to Pop?

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June 12, 2008 – Comments (6) | RELATED TICKERS: AUY , MGV , NG

I've been liking gold and silver the more I research about them and the direction of the overall economy - seems a good hedge against stagflation. Plus, the prices of these commodities seem quite low at the moment, as do the securities of the companies that mine them.

I recently read a good article on seekingalpha, with an interview between 2 precious metals specialsts: http://seekingalpha.com/article/79597-hans-peter-schmidlin-on-gold-opportunities-in-small-mid-caps

Additionally, I've been enjoying looking at the picks and pitchs of top-rated players that really know what they're doing. I'm new to the market, and really appreciate the opportunity to learn from those with more experience and exposure.

For reference (mostly my own), my current CAPS heroes include: Specbear, for being #1 and being able to see into the future and read tops and bottoms like a pro; Cipostripes, for doing the same thing while being inactive for half a year or more (amazing foresight), and TMFSinchurina and GoldminingXpert, for their great analysis and picks in the metals sector.

Good day and Fool on!

6 Comments – Post Your Own

#1) On June 12, 2008 at 12:30 PM, adventurerneil (< 20) wrote:

Woops, I meant ticker MVG and not MGV up top. MGV kind of sounds like "MacGyver", and would make a really good ticker, though.

Oh well - all the better that it's relatively unknown right now - I want to lock in a top score!

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#2) On June 12, 2008 at 1:52 PM, leohaas (98.74) wrote:

"Plus, the prices of these commodities seem quite low at the moment..."

Quite to the contrary, they are high right now. In difficult economic times like today people flee into gold and silver. Once the economy improves, people sell their gold and silver again, leading to big drops. Long term gold and silver underperform stocks significantly.

It does not mean that you cannot make money off buying and selling gold and silver. Right now, it is mostly the sellers who are making the money.

Buying gold and silver now is only advisable if you are one of those doom-and-gloom the-end-of-the-world-is-near pessimists.

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#3) On June 12, 2008 at 4:17 PM, TMFSinchiruna (56.35) wrote:

Thanks for the shout-out adventurerneil...

In strong disagreement with the above comment, gold and silver are ENORMOUSLY undervalued due to the manipulation of their prices through the highly-mobile short positions of the investment banks. Gold will reach $1,200 this year and at least $1,650 before the bull market is over. Silver will trade through $50 on its way higher.

The evidence for these conclusions is everywhere around you, and all youneed to do it tune out the propaganda from the mainstream news while you spend some time investogating the fundamantal drivers of this bull market for yourself.

Good luck with your gold and silver picks... I'm quite sure they'll be winners.

Leohaas... if it's costing $800 per ounce to bring new gold production online, how exactly is the price of gold supposed to go down anytime soon? And furthermore, where is the catalyst that will suddenly create a reversal in the dollar? What exactly is it that will bring about this market recovery you keep alluding to. I know it will come eventually.... but it's a long way away I'm afraid.

You DO NOT have to be a doom-and-gloomer to see gold and silver as an integral part of a well-balanced portfolio.

Adventurer... you can e-mail me anytime you have questions about the sector.

Fool on!

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#4) On June 12, 2008 at 4:19 PM, TMFSinchiruna (56.35) wrote:

http://caps.fool.com/Blogs/ViewPost.aspx?bpid=61033&t=01006124249416869148

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#5) On June 13, 2008 at 3:29 AM, adventurerneil (< 20) wrote:

Leo and TMFSinch,

Thanks for your insights. I love debate - even diametrically opposed opinions - by top rated Fools!

I guess we'll have to agree to disagree, however - I like TMFSinch's comment that "You DO NOT have to be a doom-and-gloomer to see gold and silver as an integral part of a well-balanced portfolio."

A question for Leo - do you consider Specbear a doom-and-gloomer? While his picks are covered in red thumbs, I think he mostly calls it like he sees it. As for me, I don't believe in backing our currency with gold or anything, and am a raging bull in general. I just think the economics of precious metals - both supply and demand - will shift for price appreciation.

Anyway, I'm rambling on my own blog and it's late. Fool on!

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#6) On June 18, 2008 at 9:47 PM, binv271828 (< 20) wrote:

Excellent post! I couldn't agree more. You and Sinchiruna are right on. If you have read some of my posts and pitches, we are definitely all in the same camp.

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