NovaGold Resources, Inc. (USA) (NG)

NovaGold - Canadian based junior gold miner with operations and interests in Alaska and British Columbia. They are an exploration and development company. This is a great company, but there are so many issues:

The Good:
- Donlin Creek has one of the largest gold deposits in the world, 14.7M oz gold measured and indicated (M&I)
- Nome Operations has 1.8M oz gold M&I
- Galore Creek *** (issues, more in a minute) has 3.6M oz gold, 61.6M oz silver, 4.5B lb copper M&I
- They are probably the most environmentally responsible miner out there. They are building hydoelectric power plants, pipelining concentrate instead of trucking, etc.

The Bad:
- In November, operations at Galore Creek were suspended. This is a joint partnership with Teck Cominco. No news yet on when this will resume.
- So many headaches and false starts. They tried to raise money through an offering of senior controvertible notes. Then they changed the amount. Then they went going to offer. Then they were. Then the amount changed again.... This was painful to watch back in March.

Where we are now:
A lot of investors have gotten tired waiting for this company to make up its mind. In April the stock price bottomed around $7. But it has finally started climbing back up, and I believe this is indicative of the future. There is so much potential in their mines, even just considering Donlin Creek, Nome and Rock Creek. With gold back on the rise, NG should start digging itself out of its hole. I have been cost averaging on the way down and now am in at a cost basis of $8.40. I think NG will be heading up nicely from here.

Gold and Silver - Relationship to the USD
Gold and Silver are money. Most people think they are commodities, which is not inaccurate. To some degree they are; Gold is a reasonably useful industrial material, and silver is a highly useful industrial material. But gold and silver's value is because they have represented wealth for so long. They are money, and they have value because they are non-dilutive.

Why is Gold and Silver going up? The question is incomplete. The complete question is why is gold and silver going up relative to the US Dollar. Remember, gold and silver are money. And like any form of money it must be valued relative to other currencies. Gold and Silver are going to continue their rise (in terms of USD) because of the extremely inflationary actions of the FED and the current government (and most likely the next government as well). It is a very sad and very unfortunate fact that the USD is being debased and devalued by the current government's fiscal policy. The US Dollar Index is on a very steady decline. There is no reason for it to rise in the current environment. The FED is printing money and trying to inflate the US out of its current economic dilemma. In order to make any kind of dent in inflation The FED has to take a much tougher stance. ... Their most recent "tough talk" on inflation... "We may not cut interest rates next meeting, and it might stay at 2% for the next several sessions"... Wow, that is the FED being "hawkish" on inflation. Meanwhile liquidity is being pumped into the system and the dollar is being devalued.

The recent gold and silver correction has provided a good buy-in opportunity. It is already on it's way out of the correction, having made up >50% of its retracement already. It is not too late yet. Once gold goes back over $1000 again, there is nothing on the horizon to hold it back. The FED has made it clear that dealing with inflation takes second seat to proping up the financial system. Unless something drastic (such as a major rise in interest rates) occurs, gold and silver will keep rising. And even with a major interest rate rise, that would only delay the upward progress. The US is still accumulating bad debt, and is still backing those loans by rapidly depreciating assets. Until there is a major recession and house prices come down substantially from where they are AND the US economy transitions from consumption based to production based, the USD will continue its death spiral. Gold and Silver will continue to rise.