INVESTING: Gold provides glint of hope during economic downturn
LAS VEGAS REVIEW-JOURNAL
As dark as the economic news has been lately, with jobless benefits claims rising and unemployment lingering, some investors see shine cutting through.

It's from gold.

Futures prices for the precious metal hit a seven-week high Thursday; Dow Jones Newswires said gold for December delivery, the most actively traded gold contract, rose $4 to settle at $1,235.40 an ounce on the New York Mercantile Exchange. On the spot market, gold prices were up $4.10 to $1,233.80 an ounce, a price gold and precious metals dealer Mark Scott will tell you is up about 30 percent from a year ago.

He's seen the rise right in his shop, Sahara Coins & Extraordinary Collectibles on West Sahara Avenue. On Jan. 4, the first shopping day of 2010, one-ounce American Eagle gold coins sold for $1,189. They cost $1,253 on Aug. 12, he said, and $1,305 on Thursday.

Scott said his shop buys and sells $300,000 to $400,000 in gold and other precious metals (silver, palladium and platinum) every day and has $2 million to $3 million on site and in stock. And he said he's seen a recent shift toward net gold buying and away from net gold selling.

Scott, 50, believes in gold so much as a long-term holding that 70 percent of his personal investing portfolio is in the metal. He says the metal holds its value and is tangible, which can assure investors in the long term and offer flexibility during disasters.

"Think of when (Hurricane) Katrina hit," he said. "You couldn't get to a bank because all of them were closed. And you couldn't ask your stockbroker to wire you $1,000. But if you had gold, you could go into a coin shop and get your $1,000."

Scott said he'd "bet his store" that gold spot prices will hit $1,300 an ounce by year's end.

Analysts suggest he may be spot-on. Richard Ross, a technical analyst with Auerbach Grayson in New York, said gold prices could challenge a mid-June intraday high of $1,265 by October. And analyst Jon Nadler of Kitco said some short-term charts see gold prices hitting $1,300 or $1,325.