Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
Trading Crude Oil ETFs in Foreign Currencies: What to Focus On - 22nd Sep 21
URGENT - Crypto-trader event - 'Bitcoin... back to $65,000?' - 22nd Sep 21
Stock Market Time to Buy the Dip? - 22nd Sep 21
US Dollar Bears Are Fresh Out of Honey Pots - 22nd Sep 21
MetaTrader 5 Features Every Trader Should Know - 22nd Sep 21
Evergrande China's Lehman's Moment, Tip of the Ice Berg in Financial Crisis 2.0 - 21st Sep 21
The Fed Is Playing The Biggest Game Of Chicken In History - 21st Sep 21
Focus on Stock Market Short-term Cycle - 21st Sep 21
Lands End Cornwall In VR360 - UK Holidays, Staycations - 21st Sep 21
Stock Market FOMO Hits September CRASH Brick Wall - Dow Trend Forecast 2021 Review - 20th Sep 21
Two Huge, Overlooked Drains on Global Silver Supplies - 20th Sep 21
Gold gets hammered but Copper fails to seize the moment - 20th Sep 21
New arms race and nuclear risks could spell End to the Asian Century - 20th Sep 21
Stock Market FOMO Hits September Brick Wall - Dow Trend Forecast 2021 Review - 19th Sep 21
Dow Forecasting Neural Nets, Crossing the Rubicon With Three High Risk Chinese Tech Stocks - 18th Sep 21
If Post-1971 Monetary System Is Bad, Why Isn’t Gold Higher? - 18th Sep 21
Stock Market Shaking Off the Taper Blues - 18th Sep 21
So... This Happened! One Crypto Goes From "Little-Known" -to- "Top 10" in 6 Weeks - 18th Sep 21
Why a Financial Markets "Panic" May Be Just Around the Corner - 18th Sep 21
An Update on the End of College… and a New Way to Profit - 16th Sep 21
What Kind of Support and Services Can Your Accountant Provide? Your Main Questions Answered - 16th Sep 21
Consistent performance makes waste a good place to buy stocks - 16th Sep 21
Dow Stock Market Trend Forecasting Neural Nets Pattern Recognition - 15th Sep 21
Eurozone Impact on Gold: The ECB and the Phantom Taper - 15th Sep 21
Fed To Taper into Weakening Economy - 15th Sep 21
Gold Miners: Last of the Summer Wine - 15th Sep 21
How does product development affect a company’s market value? - 15th Sep 21
Types of Investment Property to Become Familiar with - 15th Sep 21
Is This the "Kiss of Death" for the Stocks Bull Market? - 14th Sep 21
Where Are the Stock Market Fireworks? - 14th Sep 21
Play-To-Earn Cryptocurrency Games Gain More and Is Set to Expand - 14th Sep 21
The CashFX TAP Platform - Catering to Bull Investors and Bear Investors Alike - 14th Sep 21
Why every serious investor should be focused on blockchain technology - 13th Sep 21
SPX Base Projection Reached – End of the Line? - 13th Sep 21
There are diverse ways to finance the purchase of a car - 13th Sep 21
6 Tips For Wise Investment - 13th Sep 21 - Mark_Adan

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Bull Market Just Beginning

Commodities / Gold & Silver 2009 Feb 28, 2009 - 11:56 AM GMT

By: The_Gold_Report

Commodities

Best Financial Markets Analysis ArticleIn this update from Sascha Opel, former chief editor of the first newsletter about the German "Neuer Markt" (New Market), he gives us his current thoughts on the precious metals market. Sascha's company, Orsus Consult GmbH, publishes one of the most popular German newsletters on commodities and junior mining and exploration. (www.rohstoffraketen.de)

The Gold Report: Sascha, we last interviewed you in May 2008. At that time you felt that we were beginning a period of re-establishing gold as currency. Would you review your thinking on this viewpoint for our readers?


Sascha Opel: In our last interview, I said, ”Long-lasting gold bull markets take place when gold's role as money is being re-established. In my opinion, we are just beginning this period of re-establishment. Those calling for the end of the precious metals bull market any time soon are sadly mistaken.” Today, although nine months have passed, we are still in the beginning of that period. Look at the gold price in all currencies around the world – not only in US. dollars. Look at the price in Euro, Canadian dollars, South African rand, Australian dollars, British pound, Norwegian krone, Russian rubles, Swiss francs etc. Gold is now starting to establish new all-time highs in all those currencies. The masses will slowly realize that no paper currency is safe in the near future.

TGR: The world has gone thru a major deleveraging and financial turmoil since our last conversation. How have recent developments changed your view on gold as a currency or as an investment?

SO: I have not changed my view. It is still the place to be as an investor.

TGR: Do investors view gold differently in Europe than North America?

SO: I can only speak for retail investors in the German-speaking countries like Austria, Germany or Switzerland, where we have most of our clients. It was a year or 18 months ago when the first few people from the Street started talking about gold. The last precious metal show for private investors in November in Munich was very interesting: At the booth for Germany's biggest gold- and silver-coin dealer, there were five lines of people buying physical gold. I saw thousands of Euros being “changed” into real money—gold and silver.

TGR: If you see gold as a currency, what advantage has gold versus other currencies?

SO: For me, what's most important is that gold has no risk of failure, like corporate- or government loans/bonds. These have to pay interest; someone takes the risk to lend them the money. If you own gold you are completely independent from any government or any other institution in the world. You don't owe anyone anything. Because of this advantage you get no interest. But the aim of the international banking cartel and politics in general is to make you dependent. That is probably the main reason why the establishment fights against gold. In their opinion, everybody should put his money into corporate- or government bonds. Otherwise they denigrate you as “anti-American” or “anti-European.”

TGR: You believed gold would remain around $800 for the short term. Some newsletter writers are calling for gold to rise above $1,500 by year-end. What is your view on the price of gold for 2009, both short term (the next quarter) and long term (through the end of the year)?

SO: In May 2008, when gold was around US$900, I thought it would go down to US$800 for several reasons I mentioned at that time. We went down to US$720 until autumn 2008. Now we are back at US$900 and will perhaps go up to US$1,000 or US$1,050 at the end of March. So I was very lucky with my prediction. But - as I told you in the answer to your first question – it is very important that gold started to climb in nearly all currencies around the world. In U.S. dollars we will make new highs this year, perhaps by the end of 2009.

TGR: What factors should investors look for as a signal for gold to "take off?" What factors should investors be looking for that gold has peaked? Should we expect gold to peak in 2009?

SO: I am absolutely convinced that we will not peak in 2009! I believe that the price of gold is manipulated. I believe that we will go over US$1,200 by the end of 2009, but I am not sure if we can defend that level. The establishment surely will do something so that the price will not go too high in too short a time. In looking back at the rise of gold from $35 to $850 during the ‘70s, the former Fed Chairman Paul Volcker said, "It was probably a mistake to allow gold to rise so high.” And Volcker now is on the Obama-Team! We will not have a peak like 1980, but gold will rise constantly. Buying on dips like in autumn 2008 is the best strategy, in my opinion. Perhaps sometime later (in a few years, but not ‘09) gold will start to move US$50 or US$100 for some days in a row to US$2,500 or more. Then I would sell or hedge some “virtual” gold over the markets (futures, ETFs, short-certificates etc.), but I would not sell the physical stuff!

TGR: In our last discussion, you suggested investors own physical gold, making it at least 5% of their portfolio. Do you still feel it is important to own physical gold given the premiums required to acquire it at this time? Wouldn't owning a gold EFT do the same thing?

SO: I do not trust all these ETFs and other constructions – even if they tell the investors that the gold is held in this or that, or saved in a bank. If you want to speculate for a few months, then ETFs are fine, but not for me. I own gold for other reasons than speculation.

TGR: In May, you felt that junior producers and exploration companies had the potential for the largest returns. Do you still feel that way given that so many juniors/explorers are facing financing problems? Some of our recent interviewees have steered investors to major producers. Their logic is, with prices so beaten down on the majors, why take the risk on juniors or exploration? What is your feeling about this investment strategy? What specific investment opportunities can you recommend to our readers?

SO: I am still convinced that juniors/explorers have the potential for bigger returns. Look at stocks like Osisko Mining Corp. (TSX:OSK) , which we bought for our model portfolio in September for C$1.80. Now it's trading at C$4.50. The same with good explorers like Nevsun Resources Ltd. (TSX:NSU) (NYSE.A:NSU) , Premier Gold Mines Ltd. (TSX:PG) or Bravo Venture Group (TSX.V:BVG) , whose Homestake Ridge Project in B.C. is one of the best discovery stories in North America!

I like well-financed explorers or “special situations” like potential takeovers – one example is Forsys Metals Corp. (TSX:FSY) , a uranium explorer which will be bought for C$7 per share in cash by the end of February and is still trading at 6,25 CAD. Corriente Resources Inc. (TSX:CTQ) (NYSE.A:ETQ) is in talks about the purchase of the company (see news release, 12/16/08). We recommended our readers to buy it at around C$4, like we did in Forsys at C$3.50, because we are relatively sure that Corriente is worth much more in a take-over than the current C$4.50. The exclusive talks about the sale will end on 31st march.

I also like special stories like Commerce Resources Corp. (TSX.V:CCE) (PK SHEETS:CMRZF) , a tantalum and niobium exploration company. They have substantial cash in the bank and can play a very important role in the tantalum market in the future. I also still like Miranda Gold Corp. (TSX.V:MAD) ; they are well financed and have a great management team. For the big ones I like Goldcorp (TSX:G) (NYSE:GG) , Royal Gold Inc. (Nasdaq:RGLD) or Franco Nevada Corp. (FNV.TO) .

Sascha Opel, former chief editor of the first newsletter about the German “Neuer Markt” (New Market), Sascha Opel brings a distinctive outlook to the precious metals market. He was also the co-chief editor of “Der Aktionaer” (The Shareholder), one of the biggest German Stockmarket Magazines and advisor to an investment fund that achieved an outstanding return of 700% in three years. Today his company, Orsus Consult GmbH, publishes one of the most (www.rohstoffraketen.de) popular German newsletters on commodities and junior mining and exploration.

Want to read more exclusive Gold Report interviews like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see a list of recent interviews with industry analysts and commentators, visit our Expert Insights page.

The GOLD Report is Copyright © 2009 by Streetwise Inc. All rights are reserved. Streetwise Inc. hereby grants an unrestricted license to use or disseminate this copyrighted material only in whole (and always including this disclaimer), but never in part. The GOLD Report does not render investment advice and does not endorse or recommend the business, products, services or securities of any company mentioned in this report. From time to time, Streetwise Inc. directors, officers, employees or members of their families, as well as persons interviewed for articles on the site, may have a long or short position in securities mentioned and may make purchases and/or sales of those securities in the open market or otherwise.

The Gold Report Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in