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Strategies & Market Trends : Strictly: Drilling II -- Ignore unavailable to you. Want to Upgrade?

To: waverider who wrote (11085)	4/24/2002 8:57:59 PM
From: Frank Pembleton	Read Replies (1) \| Respond to of 36161

WR... the problem with most people out there in the real world is that they do not know which stock to buy and when they do find out (which is usually from their friendly neighbourhood analyst) - it's Barrick. Gold bullion can and will outperform hedged miners in this environment. To us that's a complete no brainer - to someone new to this sector who's watching TV and sees the poor people of Argentina lining up in front of banks that are closed indefinitely... so what I'm saying is the premium you'd pay for a coin is negligible - considering the extra risk of owning more potentially meaningless paper as a share certificate. Regards Frank P.

To: waverider who wrote (11085)	4/24/2002 11:14:44 PM
From: patron_anejo_por_favor	Read Replies (2) \| Respond to of 36161

<<Other than the fun of having some of these little shiney things floating around the house, what's the upside as opposed to buying a mining stock?>> This question enters some pretty dark territory, but it's worth remembering that if gold DOES hit $800 or $1500/oz, there will be a lot of pressure on the government (who's leased out most if not all of the treasury's gold) to nationalize miners to "stabilize the economy". If so, bullion will be MUCH better to hold than stocks, believe me! Furthermore, if the dollar has an "accident" in the reasonably near future, an Argentinian-style "run on the bank" would result in dollars not being available. What serves as "money" in that case (no one knows, but 1/10 oz gold eagles, and silver eagles could be quite useful in that scenario). Finally, although I hold a WHOLE bunch of mining stocks, they're subject to the same sorts of financial chicanery as any other equity. Most of the names tossed around these days seem pretty solid, if only because they had to weather a 20 year bear market. But Bre-X wasn't that long ago... EDIT: Personally, I'd recommend that everyone deploy a minimum of 1-2% of their net worth in gold bullion, if only as an insurance policy they (hopefully) will never use. The old joke about bullion asset allocation is "you need just enough to bribe the border guards!"<G>