Gold Entering New Paradigm

"Gold is entering a new paradigm—not a bubble. . ."

Gold is entering a new paradigm—not a bubble, according to traders speaking at the 2010 LBMA conference in Berlin.

Standard Chartered's Jeremy East quizzed whether investment in gold is a new concept, "or something we were doing 30 years ago?" He noted gold is becoming more of a recognized investment class but that holdings are still "relatively insignificant" globally. If investment interest in the West began to decline, he stated, the metal would be taken up in other ways (including India's ETF activity).

In a panel discussion, Natixis' David Gornall, ABN Amro's Gerry Schubert and Goldman Sachs' Stephen Branton-Speak noted there was a clear consensus going forward, that the precious metals industry will move to Asia.

"There will be a general move to the East, China can't understand why the gold price is made in New York; it's going to change."

Gornall said investors in the West were starting to look at gold investment through the eyes of the Indians, buying the dips. He noted it is possible that a bubble could arrive; but, for now, "a new paradigm has arrived—at least until the next one turns up."

Schubert explained that nearly everyone is long gold, "all long for different reasons with different time horizons on their sights."

Looking at macro influences and the threat of inflation as reasons for strong investor interest in gold, opinions differed as to whether deflation would cause a correction in the gold price. When posed to the audience, the resounding reply was that, even if there a period of deflation arrived, gold would still do well.

Still, the bulk of attendees' average gold holdings is around just 10%; so, even with the bullish outlook overall, investors are using gold primarily as a hedge against macro factors—not as a true asset class.

Announcing Streetwise Live! Events
Source: Streetwise Reports (07/13/2020)

Streetwise Reports is offering 100 investors—at no charge—the opportunity to meet via Zoom with executives of precious metals companies as they discuss recent developments at their companies and upcoming catalysts.

"China's export quota could be opportunity for Canadian miners"

Latin America: Six Gold Juniors Amass 100M+ Ounces
Source: Marc Davis, BNW News (05/25/2010)

Latin America, the world's last great mineral frontier for prolific gold discoveries, is proving a godsend for some lucky investors.

Mexico: Gold's Next Powerhouse Player
Source: Marc Davis, BNW News (11/03/2009)

As the world's key gold producing nations struggle mostly in vain to replenish dwindling below-ground supplies, Mexico is bucking the trend in a big way.

Where Have All the Gold Mines Gone?
Source: Brent Cook, Exploration Insights (04/14/2009)

Given the declining global gold production, mining companies’ demand for reserve replacement and the acute dearth of new gold discoveries, there is no doubt that real economic discoveries will be exceptionally valuable. . .the opportunity for stellar profits is the best it has probably ever been. Identifying the few successes, however, will require vigilant and constant technical assessment of geology and drill results, always with an eye to mine economics.

Congo Completes Mining Review, Says Majors Quit Talks
Source: Reuters (12/20/2008)

"Review process is extended an additional 45 days to allow six companies to return to the negotiating table for direct talks with government ministers."

I haven’t spoken to my old mining stock friend, noted and universally respected gold stock guru, Bob Bishop, about Rare Element in a year, but I hear he is still a supporter and very large shareholder. I don’t believe he will hold it against me to remind you that this was one of his favorite holdings when he left the newsletter writing business. . .

It's Only the Beginning for Uranium
Source: www.financialinsights.com (06/03/2005)

Dr. Richard S. Appel, author of Financial Insights, first became bullish on uranium in mid-2003, when it appeared obvious that its supply versus demand equation was fated to seriously drive higher its price. Since then, a series of events in the uranium industry has led Appel to believe that uranium prices will reach never before seen levels.

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