Monday, November 28, 2005
Gold is beginning to shine again
I just checked the spot price of gold a few minutes ago, something I do several times each working day. The price was just a nudge away from $500.00 USD per ounce: $498.30 to be exact. That is the highest price, I believe, in about seventeen years or so. Surprisingly, stock in many junior precious metal mining companies languishes at seemingly ridiculously low prices. That tells me that although investors are bidding up prices on the real physical stuff that they can hold in their hand or lock in a safe, they have yet to pile on, in a big way, to purchasing volatile shares in companies which dig the metals out of the ground, or at least hope to do so one day.
It is just the beginning, folks. If you believe, as I do, that we are living in dangerous and uncertain times, gold will explode in price sometime in the coming months. Big time investors can buy gold bullion in big, heavy, expensive bars. For the rest of us, one ounce bullion coins are a good way to invest on a smaller scale. And if gold purchases are out of the question because of the high price, a few physical ounces of silver, by way of one ounce silver coins, are a good alternative.
Purchases like this should never be looked upon as 'investments,' because frankly no-one knows for sure exactly what will happen to the prices of any commodities, including gold and silver. I tend to look at them more as insurance. Gold and silver will always have some value, because of the rarity of the metals and the many uses they have in industry, for the manufacture of jewellery, and as a barter commodity of last resort.
American Eagles and Canadian Maple Leafs are my favourite bullion coins.