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goldminingXpert (28.63)

Today's precious shiny play:



September 18, 2008 – Comments (11) | RELATED TICKERS: GLD , SLV , UUP

is not gold. One day does not a bull market make. Demand destruction is still the key factor here... commodities are in deep trouble. So, what does one do. The inflation argument is still nonsense, but if you feel you have to diversify into an inflation hedge (not a bad move regardless if you have sizable capital to work with-- don't bother if you're trading 25k or less) you want.... yes... Swiss Francs. The Franc has turned and if it breaks 1.08 support (big if, I think dollar should resume upwards run next week... but this market is irrational) the Franc is heading back to parity. That is a 10% move. You get 10% plus interest if you park in a Swiss money fund... not a bad gain. However, should the trade fail (and I believe it will), you won't get your head cut off like you will in gold. The long-term target on gold is $600... 30% down from here. The Franc has strong resistance at 1.18 (5%) up from here. You make 10% + interest if you are right, 5% loss if your wrong, that's a good trade. Gold, you make 10% up ($1000 resistance is unlikely to go down, and lose 30% (to $600) if you're wrong.) That's a lousy bet.

11 Comments – Post Your Own

#1) On September 18, 2008 at 1:24 AM, goldminingXpert (28.63) wrote:

Speaking of waves... gold finished a 5 down, and appears to have finished a 3 up corrective as of this evening. Gold already down $30/oz tonight. With yesterday's ridiculous move done, we can return to reality--otherwise known as sub-$750/oz gold.

Disclosure: GG puts, GLD puts, Long NXG and JAG. 

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#2) On September 18, 2008 at 2:04 AM, barich1 (41.66) wrote:

Hey GoldminingXpert, what do you think of SIL?  It's small, market cap of only 70.1m but the other numbers are just so good, PE of 0.4x and EPS of 3.61.

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#3) On September 18, 2008 at 2:12 AM, goldminingXpert (28.63) wrote:

called outperform in the 3's. oops. Still like it, but wondering if market knows something I don't...weird drop. Feel free to buy a small bit--highly speculative hero or zero kind of stock.

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#4) On September 18, 2008 at 2:14 AM, milpo (44.64) wrote:

Hey Friends:

Does the notion that Gold will reach $5000 per ounce within 3 years offend you?  It shoudn't. It will easily reach that level. Get rid of the optimism and become a commodity junkie.

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#5) On September 18, 2008 at 2:23 AM, XMFSinchiruna (26.55) wrote:


Leave SIL alone... there are too many better silver plays out there: CDE for one.  :)


what can I say... if I disagreed with your assessment any more than I do, we'd have to reside on seperate planets. In what reality should gold reasonably be valued at sub-$750??? It won't come out of the ground at those prices... all in costs for gold mining industry wide are at or above $700.

We've debated our differences on gold too many times before for me to believe I'm going to sway your view. I would just suggest to Fools that you give some very serious thought and research to the issue before deciding to eschew the protection of gold based upon the above post or others like it.

The dollar is toast, people. Gold is the only form of money that means anything during a crisis like this one. This is not a trader's market... but rather an environment for shifting to an asset protection strategy.

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#6) On September 18, 2008 at 3:00 AM, goldminingXpert (28.63) wrote:

gold mining costs above $700? Where? None of the companies I follow have costs that high. JAG's lousy mine only has costs in the low 600's. Plus oil is dumping, thus dropping mining costs.

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#7) On September 18, 2008 at 5:47 AM, thewindowlicker (27.73) wrote:

goldminingXpert - your primary rationale for $600 gold is the current deflationary environment?  

 ...and you feel this is a long term trend?

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#8) On September 18, 2008 at 7:45 AM, RVAspeculator (28.50) wrote:

If the Fed is going to buy all the failed companies I think I still like gold.  :)   about $900 this morning, hard to believe it dipped for a few days there.

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#9) On September 18, 2008 at 9:33 AM, XMFSinchiruna (26.55) wrote:


Let me introduce you to a more significant metric within the gold industry called the "all-in" cost of production. This is what will determine whether a mine is brought into production or not based upon the pricing environment at the time a feasibility study is prepared. You really need to read my stuff. :)




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#10) On September 18, 2008 at 9:42 AM, XMFSinchiruna (26.55) wrote:


Don't worry... gold is heading to $1,200 within the coming year, with $1,650 following thereafter as a very very conservative target. De-leveraging is not deflation. We are on the verge of a hyper-inflationary depression. At $600 per ounce, no gold comes out of the ground, so his target is an impossibility.

GMX... I mean no disrespect whatsoever. These are critical times during which Fools can protect themselves from the financial calamity taking place. I'm thankful that we can continue to express divergent ideas about all this hugely important topic while still not taking each others' disagreements personally. :)

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#11) On September 18, 2008 at 5:17 PM, thewindowlicker (27.73) wrote:

TMFSinchiruna -- I personally feel that the metals are headed much higher and that we what have recently experienced is a short term correction so I am alligned with you in that respect.  I have held GLD and SLV in my real life portfolio since 2005 and just bought more SLV at 10.80. 

 I am just curious about goldminingXpert's views on the subject. 

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