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Gold at $1,500 by Christmas?

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The Gold Report: Gold continues to languish under $1,300 per ounce ($1,300/oz), even as full economic recoveries in the U.S. and the European Union (EU) have yet to occur, despite trillions in new debt and stimulus. Meanwhile, we have two wars in the Middle East that could escalate, as well as reports that Russian troops are in Ukraine. With all that in mind, do you think that gold's fundamentals are less important than they once were, or is the price of gold being held back by other factors?

Charles Oliver: Gold is just as valuable today as it was 100 years ago. There was an orchestrated takedown of gold in April 2013. It has since traded between $1,200/oz and $1,400/oz, and this flies in the face of the conditions you mentioned.Silver Wh

"Asanko Gold Inc. has great assets."

We're going to have to be patient. We have gone through a bottoming process. We've had similar conditions before. In 1974, after the oil embargo, U.S. inflation was increasing dramatically, yet gold fell from about $200/oz to about $100/oz in 1976. Then over the next four years gold subsequently rallied to over $800/oz. In this decade, gold has fallen from $1,921/oz to $1,180/oz, but the fundamentals remain intact, and gold will regain its reputation as a unique store of value.

TGR: You used the phrase "orchestrated takedown." Do you agree with the thesis advanced by the Gold Anti-Trust Action Committee (GATA) that gold and silver prices are manipulated downward by central banks? Continue reading "Gold at $1,500 by Christmas?" →

The Worst Investing Mistake You're Probably Making Right Now

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By: Francisco Bermea

The moment the market opens, my inbox gets flooded with alerts I've set up to notify me when a holding makes a big move, hits a stop-loss, releases important news, etc.

The other week, I was inundated with messages telling me several of my holdings hit 52-week highs. In fact, in just one day, I received 11 different alerts of stocks hitting new highs.

To a huge portion of the investing community, a stock hitting 52-week highs strikes a Pavlovian response... they immediately start thinking about selling. After all, one of the first lessons investors are taught is to "buy low, sell high."

This can turn out to be a huge mistake. Continue reading "The Worst Investing Mistake You're Probably Making Right Now" →

Miners' Cost Cutting Set to Deliver in Late 2014

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The Gold Report: The gold price can't seem to climb back above $1,300/ounce ($1,300/oz) despite several geopolitical hotspots making headlines. What's underpinning the price weakness?

Raj Ray: The issue is that despite the geopolitical backdrop, the fundamentals still appear weak. The big drivers demand from India and China and gold exchange-traded fund shave been more or less flat year-over-year. China is still digesting the gold it purchased last year. And, although price premiums have declined in India following the recent Bank of India's move to permit trading houses to import gold again, further relaxation of the import tariffs is not forthcoming. If not for geopolitical conflicts providing support, gold could have moved much lower than $1,300/oz. I don't see a big driver to push gold higher over the next six to eight months.

TGR: India has imposed high tariffs on gold imports and those have resulted in a marked increase in gold smuggling. How is that influencing the gold prices?

"The first time two royalty companies came together to bid for a single project was with True Gold Mining Inc.'s Karma."

RR: I don't think there has been a marked impact on gold prices in India due to smuggling. The World Gold Council says about 250 tons of gold are smuggled into India each year. If you add that to the official gold imports of roughly 800850 tons, you still have a shortfall of around 200300 tons based on average annual imports. What might be something to look out for heading into the wedding season is the rainfall and its impact on food production. Rural India accounts for 6070% of India's gold demand. The rainfall outlook has improved slightly, but a rainfall shortage could make the government reluctant to reduce the import duties anytime soon. It would also mean that people have less money to spend on gold.

TGR: You said China is still digesting its 2013 gold hoard. How long before China is consuming gold as it did in 2013? Continue reading "Miners' Cost Cutting Set to Deliver in Late 2014" →

The Most Important Stock To Watch This Month Is...

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By: John Kosar of Street Authority

All major U.S. indices closed higher for the fourth consecutive week, this time led by the small-cap Russell 2000, which was up 1.2%. Year to date, however, the Russell has by far been the weakest, up just 0.9%. This puts the burden for continued broad market leadership squarely on the other traditional market leader -- technology.

The tech-heavy Nasdaq 100 has been up to the challenge so far, posting a 13.7% gain year to date, and is a major reason why the SP 500 is up 8.4% in 2014. But with small caps already weak, if and when technology stocks stop leading, the overall market is likely to run into some serious problems.

My own metric, which is based on ETF asset flows, shows that the largest inflow of sector-related investor assets last week was into defensive utilities and out of industrials. Accordingly, last week's strongest sector was utilities, up 2%, with industrials the only sector to finish the week in negative territory.

Be Aware Of September Seasonal Weakness

As we move into September, a good place to begin this week's report is with monthly seasonality. The chart shows that September is the seasonally weakest month of the year in the SP 500 since 1957. On average, it closed 0.68% lower for the month and posted a negative monthly close 54% of the time.

This is one of several good reasons to pay particularly close attention to your stock market investments this month, and to have a defensive plan already in place in case this 56-year seasonal pattern emerges again this year.

We should also note the historical tendency for a strong fourth-quarter rebound, so even if the market does correct this month, we should be looking for near-term weakness to potentially provide better intermediate-term buying opportunities. Continue reading "The Most Important Stock To Watch This Month Is..." →

Five Aussie Companies with Cash Flows, Low Costs and MOUs

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The Mining Report: Australian mining shares had a great July. Was that a one-off or indicative of a trend?

Luke Smith: July tends to be good because the fiscal year-end for most personal investors in Australia is June 30, so there is tax-loss selling up to that date. That said, this July was better than average. The gains slowed down at the end of the month, but we've seen a liftoff again from the middle of August. Hopefully, this trend will continue, and we'll see the revival of Australia's small-resources sector.

TMR: Asian countries such as China and Indonesia are moving toward added-value mining. What implications does that have for Australian mining?

LS: Indonesia is a large supplier globally of tin, nickel and pig iron. The decrease in tin from there is counteracted to some degree by Myanmar becoming a tin producer overnight. The decrease of Indonesian nickel has already been positive for Australian nickel producers and explorers and the nickel price on the London Metals Exchange.

"Syrah Resources Inc. owns the Balama project, which contains close to 1.2 Bt with about 10% total contained graphite."

TMR: Newcrest Mining Ltd. (NCM:ASX), Australia's biggest gold miner, has suffered a lot of bad news lately, including a $2.5 billion ($2.5B) write-down and a class action suit. To what extent do its woes mirror that of Australia's gold industry as a whole? Continue reading "Five Aussie Companies with Cash Flows, Low Costs and MOUs" →