Monday, September 11, 2006

Gold at $585 spot

while constantly on the lookout for new and exciting ways to lose all your money, i've recently stumbled into the precious metals market.

for those who have all of their assets in US dollars and US realestate, it might be a good time at investigating some "deworsification" :)

The Washington accord, which dictates to several of the big central banks, how much gold bullion they can, i mean "sell" into the market is ending its year on Sep 26. The recent rundown in gold, while certainly driven by seemingly benign inflation, low energy costs, and geopolitical tensions easing, is likely also influenced by some selling into that annual deadline.

as i'm typing this gold has fallen to the $585/oz range. it could go lower, certainly. I'm holding back some dry powder in anticipation of some tasty bargains later this month, however, i also added a little today.

while i think uranium miners or uranium participations (canadian) are probably a quicker way to lose all your money, gold is probably more suited as an "entry level" metals investor. how does one do this?

luckily, it is much easier now than ever before to lose your money in the precious metals market! :)

if you have a brokerage account (no futures account needed) you can play one of the many gold miners, gold mining stocks.

OR you can buy a "basket" of gold mining stocks by buying ticker GDX

If you'd prefer not to lose all your money when overcompensated boards and execs at goldmining company do something stupid with your money, you can play it more directly with the ticker "GLD" which is just a way to play gold bullion directly -- although you don't actually hold the bullion -- jus the certificates and u don't have to arrange for storage, etc directly.

So, what if you don't have a brokerage account?

"Luckily" there is another way to play! you can go to or one of the other "virtual" gold sites. these guys sell you gold for slightly over spot and hold the gold in their vaults (audited freqently). The storage/fees/margins are actually pretty competitive, since buying, selling, owning, storing, insuring, assaying, etc gold bullion is not the cheapest of transactions.

The time to do this research is now, not if/when gold flies upwards again. In a couple of days, perhaps, when everyone is screaming that the gold bull is dead would be a good time to be looking around.

disclaimer: none of the above consitutes investment advice, obviously. everyone's financial situation and risk tolerance levels are different. make your own investment decisions (which will almost certainly be more clear headed than my own), and consult a registered investment advisor if you decide to do anything.

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