[Leaning Right]

Please note that I'm talking about precious metals stocks, not the metals themselves. That's a whole other topic!

Thanks to all who respond.

[martinidon]

Bad news for the Alaska Gold Rush boys...

[aMorePerfectUnion]

I think gold is going below $1,000 per ounce and perhaps to the $950 range. I’m not buying yet, but stocks are different than the metal.

[wastoute]

Generally there is an inverse relationship with mining stocks and the metal itself, weird but I believe it is true. Mining stocks are sort of like pork bellies.

[Rockingham]

Gold mining stocks are subject to risks and influences other than simple metal prices and supply and demand for it. Competition, interest rates, technical considerations, currency values, politics, manipulations by nation-states and large investors, and other factors all play a role and are too difficult to model and hedge for any but the best informed and well-heeled investors.

Emotional influences -- especially your emotions -- can also affect market prices and investment strategies and decisions. For many investors, gold's emotional appeal and belief in its enduring value make for disabling effects. They lose sight of market fundamentals and basic investor maxims about cutting losses, making quick decisions, and hedging risks. They fail to take profits when they can and tend to let fear and greed get the upper hand.

I once knew a wealthy Canadian, a retired businessman worth near a hundred million dollars who started speculating in the gold market in the late 1970s on the reasoning that the dollar was doomed to continuing decline. For a time, he did remarkably well, but then lost almost everything when the market turned against him as Reagan's economic policies took hold and the dollar rose in value. Oddly, the Canadian was a stalwart conservative who greatly admired Reagan and agreed with his policies even as he failed to reckon with the effects of their success on his speculative position in the gold market.

The bottom line: the gold markets, including that for gold mining stocks, are especially opaque and tricky for investors. I would avoid gold and gold mining stocks, and if I did get in, I would not put more at risk than I was willing to lose. Above all, I would not fall in love with gold or become a believer if I became an investor in it or in gold mining stocks.

[sten]

everyone is buying in volume, yet the metals are dropping.

of course, this is counter to econ 101

unless you factor in the federal reserve.

what they’re doing is buying gold at the end of the day using freshly minted cash ... then sell the gold at a loss just before open (they don’t care, as they print as much as they need)

why?

this sets the momentum of gold for the day, keeping it from elevating too much.

[Daffynition]

[captain_dave]

There’s a big difference between precious metals and precious metals stocks, which usually means mining companies. We’re in a deflationary period and the dollar will go up in value. That means gold and silver will decline in dollar terms. Mining companies will probably not do well.

[Jet Jaguar]

Goldbug ping..

[dennisw]

precious metals stocks and physical metals might be down for 5-10 years due to the oil/gas/energy complex being down due to the fracking revolution. Flight to the USD for safety (Greece situations) also hurts precious metals.

But precious metals ownership (gold especially) will preserve wealth during a deflationary collapse which could happen within 3-5 years