Some interesting comments I've read over the weekend:

It’s significant that, on an inflation-adjusted basis, all of the natural resources except gold and silver have surpassed their previous all-time highs. Gold is only approaching the halfway mark to $2,300 an ounce, which would be its 1980 high when adjusted for inflation.

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And with this purchase from the IMF, India has gone from being a price taker as a jewelry consumer to being a price maker as an investor. This is the sort of change in government policy that we watch for in shaping and maintaining our investment models. It is significant that India, the second largest country in the world by population and the largest gold jewelry consumer, may have created a new floor for gold at $1,000 per ounce.

The presence of a big bullish buyer tends to create a big bullish buzz for gold. We’re seeing it now – gold on Friday surpassing $1,100 an ounce – and history suggests it may last a while.

Around this time in 2005, for example, Russia announced that it was doubling its gold holdings from 5 percent to 10 percent of its reserves. At that time, gold was selling for about $490 an ounce. A year later, the price was up 30 percent.

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Here is an interesting chart. We have more gold than anybody else, but as the rest of the world tries to catch up, the increasing demand will continue to force the price higher.



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Our wise guy and absolutely marvelous U.S. Treasury Secretary Timmy The G. told us this morning the economy needs more time to rebound. No Kidding. The last time we went through this mess it lasted from 1929 to 1954 for the stock market recovery. This time it’s infinitely worse times ten. We might all die of old age before the next recovery in mainstream shares. The stocks today (excluding precious metals and a few others) are just where they were in the year 2000. Consequently those holding from there to here had a wonderful exercise in brain damage and futility. So much for buy and hold forever.

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