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The Fed Tapers and Gold Topples

Surprised?  So am I, both by the Fed’s decision, announced this past Wednesday, to taper back its easy-money policies of the past year . . . and, even more so, by the subsequent fall in gold and silver prices. In fact, Federal Reserve Board Chairman Ben Bernanke surprised many investors, traders, and analysts, announcing the Fed would cut back its monthly asset purchases by a relatively modest $10 billion in January – and continue “in further measured steps” if the economic recovery stays on track. To understand my own expectations ahead of the Fed announcement, read my last commentary ...

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Gold This Week — Eyes on U.S. Monetary Policy

Precious metals and the broader financial markets continue to react to the latest economic news, both statistical and political, with traders and investors guessing how each new bit of information on the economy may affect the Fed’s decision – when and by how much – to cut back, or taper, its $85 billion per month bond-buying program. It has become the accepted wisdom of the markets that rosy economic prospects increase the odds that the central bank will choose to begin tapering sooner rather than later . . . and expectations of reduced monetary stimulus have been one of the key bearish ...

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The Volcker Rule: Implications for Gold & Silver

The Volcker Rule, banning the largest U.S. banks from engaging in speculative trading, has now been approved by the U.S. financial regulatory agencies – with important implications for gold and silver. The Rule, a provision of the 2010 Dodd-Frank Wall Street Reform Act, forthwith prohibits banks with federally insured deposits from trading activities undertaken for their own benefit. ...

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THE OUTLOOK FOR GOLD AND SILVER

Jeffrey Nichols Managing Director of American Precious Metals Advisors Speech presented to the SPC Precious Metal Company Seminar Bangkok, Thailand What a pleasure it is to be here today in this beautiful city to talk about one of my favorite subjects:The Outlook for Gold and Silver.I am honored by the S.P.C. Precious Metal Company and the Thailand Stock Exchange for sponsoring this seminar . . . and by all of you for taking time out of your busy schedules to hear my thoughts on these metals. So, let me begin with gold: I believe, before long, we will see gold hit $1500 an ounce -- ...

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GOLD & SILVER: Speech to the ResourceOne Conference, New York

Those of you who know me know that I am quite optimistic about the outlook for gold and silver.  This may be good news for those of us in the mining business or invested in precious metals assets. Unfortunately, to be bullish on gold means that I'm pessimistic about the U.S. economy, particularly the outlook for inflation and economic growth, over the next few years.  More about this in a few minutes . . . Price Projections But first, at the risk of sounding like a gold bug -- which I'm definitely not -- let me give you some numbers:  I believe we will see gold back near its ...

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2010: Gold & Silver Expectations in Brief

Gold has enjoyed a long and enviable climb, rising some 380 percent from a cyclical low near $255 an ounce in April 2001 to an all-time high just over $1,225 in early December, 2009.  Although the bull market will celebrate its 9th birthday this year, it still has a long way to go, both in magnitude and duration. I expect the yellow metal will hit $1,500 an ounce  - or higher - during the New Year, a gain of more than 35 percent from its December 31st close. And looking further ahead, gold's bull market will likely continue for another few years, carrying the metal to a cyclical peak of ...

GOLD — Deflation Hedge?

Gold's relative price strength in recent days -- in the face of plummeting U.S. consumer and producer prices, declining prices for oil and other (non-precious metals) commodities, and lower multi-year lows in world equity markets -- suggests that the yellow metal, technically speaking, may be building a solid base in the $770 to $800 range from which to embark on a sustainable advance into higher territory. Interestingly, gold has been outperforming silver and the PGMs, suggesting that investors and traders are differentiating among the metals, favoring gold as a monetary asset, safe haven, ...

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GOLD — Nearing a Turning Point

Despite gold's latest weakness and the possibility of further breakdown, I believe we are nearing a turning point in the tenor and direction of the market.  Before long, gold will begin a new and sustainable upward march. Until then, with the yellow metal in the $700 to $730 range - and certainly at lower price levels - price-sensitive demand from key Asian and Middle Eastern markets should stabilize the market. With $1000 gold very likely in the next year - and still higher prices beyond - the risk/reward ratio is very much skewed to the plus side. Commodity Disinvestment Running Its ...

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Gold — After the Fall

Despite this morning’s sharp sell-off in precious metals, the key factors favoring gold, silver, and the platinum-group metals remain in place. Gold, in particular, has been acting much like a currency, reacting negatively to strength in the U.S. dollar in recent weeks, just as the depreciating greenback early this year was mirrored in gold’s swift run-up into four-digit territory.  And, the short-term outlook – for the days and weeks ahead – still depends very much on the fate of the U.S. dollar. Both big moves – first up to US$1034 and then back down to the $850 vicinity –reflect, in ...

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