Focus on QE Overlooks Other Factors

Source: Kitco, Debbie Carlson (10/21/10)

"If printing money doesn't work, what will be what do we do next?"

Commodity and equity markets have been rallying on ideas that the Fed will pump more liquidity into the system with quantitative easing, perhaps as soon as the next Federal Open Market Committee meeting in early November.

But some market watchers wonder if issues like the uncertainty with U.S. home foreclosures might not turn the view of investors back to other problems after any Fed move. Last week, when it was discovered that several banks had signed off on thousands of foreclosures without reading the documents, shares of bank stocks fell.

Shawn Hackett of Hackett Financial Advisers said there's a very good chance that the market will start to focus on something else. "The basis for QE2 is that the economy is in shambles. The first QE didn't do the trick, which is why this one is taking place. If we had a booming economy we wouldn't need it," he said.

"A decline of shares will see investors liquidating carry positions, pushing volatility up and the (dollar) higher," they said.

And a higher dollar would cause gold to swoon.

If the Fed signals at the next FOMC meeting it will ease, gold should take another real leg higher into year end, with a move to $1,500 an ounce, said Spencer Patton of Steel Vine Investments. "The market will always be thirsty for more Fed action."

Further down the road, Hackett said the problem will come if the second round of easing doesn't boost the economy. "If printing money doesn't work, the question is what will be what do we do now? There is no Plan B," he said. "That’s when the markets will lose all faith in the Fed. They’ll have a failed policy."

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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