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Happy New Year from Goldfinger
Coin & Bullion!
In the past few weeks we have seen an explosive rise in the price of gold
with the possibility of more to come. Our commentaries in this issue
include another excellent analysis by Mary Anne and Pamela Aden, as well
as an article on the Australian Kangaroo Series of gold coins by the Perth
Mint.
Article # 1 Breakout!
by Mary Anne & Pamela Aden
Article # 2
Australian Nugget Coin Series
BREAKOUT!
by Mary Anne & Pamela Aden
http://www.adenforecast.com
Well it finally
happened! Gold broke clearly through the $330 level last week and a
stronger phase of the bull market is now underway. In fact, this is the
most bullish signal that’s happened since 1980 and it’s a very big
deal.
If you’ve read our previous articles, you
know we’ve been watching the $330 level closely. Gold tried to break
above that strong resistance in June and again in September, but the third
try proved to be the charm and gold is now on its way.
The $330 level was also gold’s prior peak
in 1999. Interestingly, the only strong rises in gold’s big picture
since 1980 were in 1985-87 and 1993-96. In both cases, however, gold was
unable to rise above its prior peak… that is, until last week. This
tell us we’re now in a different ballgame. Not only is this bull
market for real but it’s exerting the type of underlying strength not
seen since the 1970s.
We’ve received many
e-mails from readers warning us about the large interest groups trying to
keep a lid on the gold price. Be it the commercials who are short, or the
gold mining companies who are hedged, or the Fed… and we understand. But
we also know that the major trend is the most powerful and gold’s major
trend is up. Plus, now that gold’s broken above $330, it’ll begin to
attract a lot more attention, pulling new buyers into the market, which
will propel the price even higher.
INVESTING WITH
THE TIMES
Overall as the year
draws to a close, it’s been a very interesting one. International events
took center stage as terrorism and
Iraq
maintained the headlines. The world economies
struggled along and the markets reacted accordingly.
Mostly, the markets
continued on their courses set last year or the year before. Stocks fell
further with Nasdaq down 28% for the year to
date. Gold’s been on an upward path all year and it’s currently at a
five year high. Likewise for the currency markets, as
the U.S. Dollar continued on its downward path. Oil rose sharply,
in large part because of war threats, and the commodity markets did too.
Gold shares had a great first half, then
consolidated as the year progressed, but they’re up 44% so far this year
and on the rise again.
We believe these major
trends will continue as we move into the new year.
Remember, mega trend changes have taken place in stocks and gold over the
past year, which strongly suggest gold will move higher and stocks will
remain bearish (see Chart 1). That in turn means the Dollar will
stay under downward pressure, since the Dollar and gold move opposite, and
the currencies will rise.
As for
oil, much will depend on the war on terrorism and Iraq. Interestingly, the
major market trends are coinciding with a war outcome, but we don’t need
or want a war for these trends to continue. If it happens, however, it
would be bullish for gold and bearish for stocks, which would intensify
the major trends already in place. Geopolitical risk remains high, which
makes crisis investing an important strategy for now.
More certain, the
Fed’s priorities have changed. This month they came out strongly against
deflation. In other words, inflation concerns have taken a back seat. And
in its battle to fight deflation, the Fed has been, and will continue to
take inflationary actions to turn the deflationary tendencies around. If
it eventually results in inflation, so be it, but the Fed’s actions are
showing it considers deflation the immediate and greater danger and
that’s where its focus is, which is good for gold as well.
STOCKS &
GOLD: Changing places
Keep in mind, the stock
market is still forming a massive top. All the market’s done so far is
erase the extreme excesses of the grand bull market. It reached its 1997
lows in October, which means that most people who’ve bought stocks over
the last five years have losses. This certainly isn’t as bad as the
1929-32 losses when 15 years of stock gains were erased, and considering
the largest financial bubble in history has burst.
It seems unlikely that
the January level near 10000 will be reached this month and if it isn’t,
it means 2002 will mark the third consecutive down year in the stock
market for the first time since the 1939-41 time period.
This alone shows we’re not in normal times.
Meanwhile, gold has
been building a solid bull market base for the last several years and we
don’t think it’s a coincidence that it’s coinciding with the biggest
financial bubble and bust in U.S. history.
We’ve been taking
this bull market one step at a time. And so far the steps are well in
place for a sustained rise in gold, so keep an eye on $330 as gold is very
strong above it and the bull market is heating up.
*******
Mary
Anne and Pamela Aden are internationally known investment analysts and
editors of The Aden Forecast, a market newsletter providing specific
forecasts on gold, gold shares and other major markets. Click here to
visit their website at http://www.adenforecast.com
The
Australian Gold Kangaroo Series by the Perth
Mint
In
1987,
Australia
’s Perth
Mint introduced a 1-oz. gold .9999 bullion coin with the image of the
largest gold nugget ever found on the reverse, the 2,284-oz. Welcome
Stranger nugget, which was found in
Western
Australia
in 1869.
This new gold bullion coin was appropriately named the Australian Nugget. The
obverse carries an image of Queen Elizabeth II, as do most Australian gold
coins.
At
first, these coins pictured on the reverse side a famous Australian gold
nugget. Maybe pictures of
gold nuggets are recognizable in
Australia, like pictures of baseball
players in
America
. But to most of us, the gold
Nuggets from 1986-1988 pictured lumps that looked like meteorites, or
maybe just clods of dirt. Thankfully, in 1989, this design was changed to
feature different Kangaroos, a more world-recognized symbol of
Australia, with
the design changing yearly as a result, Nuggets are frequently referred to
as Kangaroo Nuggets. Unlike the Australia’s
Perth Mint Lunar Series gold coins, Nuggets have no production limits.
From
its beginning, this issue of coins had two unique features: a two-tone
frosted design effect and individual hard plastic encapsulation of each
coin. For a standard-price bullion coin, these features were unheard of,
and served to position the Nugget as a product offering a lot of value for
a standard bullion price.
Each
year since 1989 the design has been changed with various portraits of
kangaroos. The year 2003 Kangaroos currently available
feature a portrait of a solitary ‘roo
drinking from a pool of water in the desert. Kangaroo coins come in
protective round plastic cases issued by the Mint. |
