Precious Metals Market Heading a Different Way


"The utter simplicity is to buy gold, silver and oil."

Thus far in 2010, precious metals' performance has been remarkably strong as nations throughout the globe struggle to emerge from the economic crisis while investors seek security as economies wobble. Prices for spot gold have advanced 24%, palladium has increased 75%, and silver has gone up 64%.


The utter simplicity is to buy gold, silver and oil when the money supply is being increased by the Federal Reserve merely creating it out of thin air, and doubly so when the federal government was deficit-spending it, and triply so when the Federal Reserve itself is using the money it created to buy the Treasury debt that needs to be bought so that the federal government can deficit-spend it."

Industrial Growth

Like silver, platinum and palladium are heavily linked to the strength of industrial growth. Specifically, they are staples in the production of catalytic converters and therefore synonymous with the automobile recovery. Thanks to ETF Securities, a relative newcomer to the U.S. ETF industry, investors can now gain access to the price actions of the two metals through two separate physically-based products.

Level of Purity

The level of purity varies from issue to issue. 99.9% purity is common. The purest mass-produced bullion coins are in the Canadian Gold Maple Leaf series, which go up to 99.999% purity. Note that a 100% pure bullion is not possible, as absolute purity in extracted and refined metals can only be

In short, I have mixed feelings for gold and silver. Yes I think they are good long term plays, but after the run they have had it is also very possible a much deeper correction is about to take place.

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