Gold & Silver Bandwagon Gets Another One

growthstockwireI’ve followed Jeff Clark’s writings in “The Growth Stock Wire” for a few years now. He’s a died-in-the-wool stock market guy and has a decent track record there. This Q&A is from his latest newsletter:

Reader asks: A few weeks ago, you were wildly bullish on gold and gold stocks. They’ve since dropped sharply and recovered a bit. What are your current thoughts on this sector?

You must own gold or silver. When central banks around the globe are printing money faster than Danielle Steel prints romance novels, your only hedge is to own gold or silver. I underestimated the need for liquidity, which caused institutions and investors to dump everything – including precious metals – in an effort to raise cash. But their selling does not negate the logic behind this trade.

“We could see additional selling pressure over the next week or two if the broad stock market takes a hit. But the current economic environment is hugely bullish for precious metals. And precious-metal stocks offer dramatic leverage on this trade.

“I’m not a typical gold bug who thinks gold can only go higher and if it doesn’t then it’s some sort of government conspiracy. I’ve often written bearish articles on gold when the price has extended further than logic dictates.

“The current economic environment, however, is bullish for gold and silver. The short term is up for grabs, but I can’t imagine a better trading idea for the intermediate and long term.”

◊◊◊◊ Now: Gold @ $735.00, Silver @ $9.96, USDX @ 86.29 ◊◊◊◊
◊◊◊◊ Now: DJIA 8,611.92

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