While physical gold is not in our buy zone, many gold mining companies are selling as if the price of gold is currently $800 to $900 per ounce, which is 28% to 36% lower than gold's closing price on January 31, 2014, and well within our buy zone.
"There are two ways to conquer and enslave a country. One is by the sword. The other is by debt."
- John Adams, 1735 - 1826
- We continue to be concerned about the increasing levels of federal debt, Fed policy and quantitative easing, and the overall lack of political will to change the present course. As a result, we believe that the probability of elevated inflation over the next 5 years has dramatically increased and have been reviewing gold as a potential investment for our portfolios.
- During our study of gold, we arrived at a methodology that prices the commodity from five different viewpoints. Currently trading at $1,220 to $1,300 per ounce, we believe gold is selling in a fair value range.
- While physical gold is not in our buy zone, many gold mining companies are selling as if the price of gold is currently $800 to $900 per ounce, which is 28% to 36% lower than gold's closing price on January 31, 2014, and well within our buy zone.
- With or without high inflation in the future, we believe many gold mining companies have been selling at bargain prices and have added them to our portfolios.
The gold pricing in this report is measured using the London PM Fixing price, quoted in U.S. dollars per ounce.
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