Gold, Silver & Other Precious Metals 02 (Nov 08 - Jul 09)

[winston]

Yes, for storage of value lah which is better than nothing after WW2, as those Japanese Banana Money is worthless ..

[winston]

Stats of the Week: 105%
Gain in the price of gold in the past four years. The S&P 500 is down 28% in the same time.

Source: Daily Wealth

[winston]

Why I'm Happy to Hold Wealth in Gold and Silver By Chris Weber, Daily Wealth

Now that the first half of 2009 is over, I have to say I'm very happy with the way gold, silver, and platinum have done this year. I've been keeping a large portion of my money in the metals for years.

I like the way that the spotlight has now turned away from them, but quietly – when you look back on the year so far – they all have had solid gains. Quiet gains; those are my favorite kind.

Gold has had three consecutive rising quarters now. But more important, it has been holding most of the huge gains of the bull market of recent years.

Most other assets that have jumped hugely spike up and then collapse for years: Think real estate and high tech stocks. But gold has been in a great bull market for a decade and, though still in a corrective phase, has still risen solidly for months.

It started the year at $880; at mid-year it is $926.70. That's a rise of 5.3%, or 10.6% annualized (though no one knows how the rest of the year will play out).

Again, to me, this is great action. Quietly, gold has added about one percent per month so far this year. And no one is talking about it. Huge falls have proven temporary, but these are what people focus on. All the while, over time, the price rises. I'd be happy to take a 10% annual rate of return consistently on anything.

And if double-digit annualized returns are what gold is giving when it is "sleeping," what will it do when it awakes?

Silver started the year at $11.33. At mid-year, it was $13.54. Again, maybe many are not satisfied. But do the math and you get a 19.5% return. That's nearly 40% annualized. What's to complain about? And even more so than with gold, the focus of the public is far from silver. You give me an asset that rises by nearly 20% in six months with no one watching it, and I'll be happy.

Finally, platinum climbed 27.5% in the first half of this year, the best of all. However, this one is the most volatile and thinly traded. Still, if the Dow had soared 20-something percent since the first of the year, everyone would be crowing.

And indeed, bullishness has returned on the stock markets. Most everyone now believes things will get great or continue great. But this kind of thinking for markets that have barely moved since 2009 began is misplaced. All that has happened is that they have risen from their March lows.

I expected this... Back in mid-March, when I suggested to my readers that one could buy virtually any stock, I said that a rally would cause great bullishness to return. And so it has. But one has been better off just by sitting in gold and silver and doing nothing else.

Moreover, the stock markets look quite vulnerable. The Dow Transport Index has not confirmed the last high in the Dow Industrials. And both the Dow and most other global stock markets have been doing nothing much for the past few weeks. Moreover, they have been doing it on ever-lower volume. It is possible that the bear market rally has seen its best days.

All this is why I'm happy to continue holding a large position in precious metals. Granted, their performance this year isn't as spectacular as many hoped it would be. But in gold, I own a relentlessly rising asset that benefits from the competitive currency devaluations I discussed last month. In today's world, that lets me sleep soundly every night.

[HengHeng]

30 years later how u know whether if gold would be worthless? What happen if suddenly some joker which is an alchemist suddenly is able to produce gold from lead?

I did mention before 30 yrs ago .. during 1979-1980 some joker actually bought gold at 800 .. after 30 yrs .. he would be seeing only slightly more than 10% returns .. then how ? Somemore USD/SGD value drop like dog as compared to then?

[kennynah]

30 years later how u know whether if gold would be worthless? What happen if suddenly some joker which is an alchemist suddenly is able to produce gold from lead?

oh....you also know the dark secret....that da vini did that a long time ago....shhhh.....don't tell others...

[HengHeng]

shhhh .. later no one come my shop buy gold liaoz .. LOL .. joking ..

[winston]

30 years later how u know whether if gold would be worthless? What happen if suddenly some joker which is an alchemist suddenly is able to produce gold from lead?

Agree. Who knows what will happen to Orchard Road 30 years from now ? Maybe it will be under water at that tme. So, there's a need to constantly monitor the investment and decide whether one wants to hold or fold.

[winston]

China’s Gold Reserves Unchanged in June, Central Bank Says

July 15 (Bloomberg) -- China said its gold reserves were unchanged in June compared with April, according to a statement from the central bank.

The People’s Bank of China held 33.89 million fine troy ounces of gold on June 30, the bank said in a statement on its Web site today. The holdings are equivalent to 1,054 metric tons, Duan Shihua, senior analyst at Nanhua Futures Institute, said by phone from Shanghai.

China has boosted its gold reserves by 76 percent since 2003 and has the world’s fifth-largest holding by country, the State Administration of Foreign Exchange said on April 24. The nation increased its reserves by 454 tons to 1,054 tons during that period, even as the reported level of Chinese gold reserves didn’t change from January 2003 to April this year.

Gold climbed to a record $1,032.70 an ounce on March 17 last year and was little changed today at $926.03 an ounce at 11:30 a.m. local time in Singapore.

China’s foreign-exchange reserves topped $2 trillion for the first time, the central bank said in today’s statement. The reserves rose a record $178 billion in the second quarter to $2.132 trillion. That compares with a $7.7 billion gain in the previous three months.

[kennynah]

gold has just spiked in today's session....

[millionairemind]

gold has just spiked in today's session....

I believed you got long positions in GOLD right?? Congrats!!! HUAT AR!