The Hidden Costs of Precious-Metals Miners’ Optimism By Andrey Dashkov, Research Analyst The junior resource sector is struggling financially, something most investors seem to agree on – and rightly be wary of. Here at Casey Research, we've analyzed both producers and explorers to see how profitable (or value-adding) they may be under current market conditions. The rather obvious conclusion, shared by many company executives, is that now is the time to be frugal.> Producers have started to focus on cutting costs and pulling back from development projects that have diminished prospective returns or otherwise unacceptable risk profiles. Developers have sinned in their own way, … [Read more...]
Buying or Selling Gold and Silver?
Many investors consider the recent drop in gold, silver and platinum prices to be the perfect opportunity to build (or add to) their precious metals position. With the price down, the basic law of supply and demand has kicked in and demand for silver bullion and silver coins has risen sharply. Short-term, supply has gotten tight, as some dealers scramble to keep up with demand. We also saw a major disconnect between Physical Gold vs. Paper Gold as a massive sell order hit the futures market to sell 400 tons of gold! But at the same time small buyers rushed to their local dealer to take advantage of the price drop and stock up on the physical metal. And of course since gold and silver … [Read more...]
Investing In Silver
Investing In Silver can be extremely profitable when the common man decides he wants to invest in precious metals and thinks he can't afford gold. If a major spike in investment demand if it were to occur there wouldn't be enough silver to meet demand and prices would skyrocket. In today's post Jeff Clark looks at the case for investing in silver. ~Tim McMahon, editor. Hi Ho Silver: Making the Case for This Precious Metal By Jeff Clark, Senior Precious Metals Analyst Even though the newsletter I write for Casey Research is focused primarily on gold, our metals investments cover all the precious metals, and when warranted, some base-metals plays too. And with the markets in the state … [Read more...]
Gold Mining Stocks are Down – What’s Up?
For many years now I've been saying that Gold is a Crisis Hedge rather than an inflation hedge. But it is also a commodity and a monetary instrument. Thus there are a variety of factors affecting its price at any given time. Currently as the world economy continues rolling on people are less worried about catastrophe around the corner and they are beginning to believe that the FED is all powerful and can paper over any and all monetary problems with the stroke of a pen. So why worry? This has taken some of the edge off the urgency to buy gold. Plus as the stock market reaches new highs the "opportunity cost" of holding gold increases. So does this mean that gold is headed for the dustbin and … [Read more...]
The Impact of Inflation on Savings
The obvious impact of inflation on your savings is that the purchasing power is erroded. This means that if you stash $100 under the mattress today and inflation is 3% per year when you come back a year from now your $100 will buy 3% less stuff. Put another way you would need $103 to buy the same amount of goods a year later. When you extend this to 10 years you might think that it would mean that you would need $130 to buy the same amount of goods but because of the effects of compounding you would actually need $134.39. You can use the Retirement Planning Calculator to calculate the impact of inflation on your savings. As time goes on the impact of "only" 3% inflation compounds making … [Read more...]
What are “Foreign Exchange Reserves”?
Will the U.S. Dollar Be Replaced as the World's Reserve Currency? Foreign Exchange Reserves are foreign money held by International banks for use in international trade and in an effort to diversify their holdings and hedge against the inflation of their own currency. The most common items bought and sold with their foreign exchange reserves are oil and gold. Up until 1944 the asset of choice was gold and it was used as the medium of exchange between countries to settle their debts. But in July 1944, delegates from the 44 Allied nations gathered in Bretton Woods, New Hampshire., and made the U.S. dollar the reserve currency of the world. At that time, the dollar was pegged at $35 per ounce … [Read more...]
Selling Your Scrap Gold During The Economic Downturn
Selling Your Scrap Gold Economic downturns are a fact of life and you never know when you might be caught up in events outside your control. That is why you always have to be prepared for the circumstances life might throw at you. If during good times you have accumulated some gold either as jewelry or coins, then selling your scrap gold is one such step that you can take when times are rough. There are many advantages of having some gold as an insurance policy against tough times. What is "Scrap Gold"? In its simplest terms, scrap gold is any gold that is sent back to the refiner for recycling. Mostly it is broken jewelry that is no longer needed. Gold coins are rarely melted down … [Read more...]
Why Gold is a Good Investment for Inflationary Times
The Impact of Inflation on Savings If you keep your money in the bank or in money market funds, inflation can eat away at their value. Inflation can be deceiving because your account balances won’t go down. However, when you take your money out to buy something, you might notice that you won’t be able to buy as much as you used to. Therefore, if you don’t put your money into something that keeps up with inflation, you’ll soon find your savings won't buy as much. As an investor, you need to be prepared for the risk of inflation. It happens when there is too much money chasing too few goods, so prices have to go up (because of an increase in the money supply). When the economy is facing … [Read more...]
Gold and the Federal Reserve
Gold-US Dollar Link by Chris Vermeulen The $1800 per ounce level continues to be a major technical resistance area for gold. After hovering near $1800 recently, gold moved sharply away from that level last week to close at $1735 an ounce. Despite that, more fund managers and analysts continue to point to a bright long-term future for gold prices. John Hathaway of the Tocqueville Gold Fund says gold will reach new highs within a year. He based his forecast, like many others, on the fact that negative real interest rates look likely to persist as Ben Bernanke and the Federal Reserve continue to print money. Believe it or not, some mainstream analysts are also touting gold’s … [Read more...]
Civil Liberties Rest Upon Sound Money
Sound Money = Freedom Over the years I have written many times about the necessity of sound money to base our economy on and the results of wanton reckless money creation that will alway result in inflation and a worthless currency either sooner or later. I've told you about how inflation affects you, and how the Money Supply affects Inflation and Who Inflation Hurts the Most. I also spoken at length about the value of gold as the Timeless Inflation Hedge and how Gold is Still Money. Today, Wendy McElroy, author of The Art of Being Free shares a deep and fascinating research on all the main issues we face: the loss of security in the name of security, the state's role in strangling … [Read more...]
