Run, Don't Walk Towards The Precious Metals

I know this call is sounding a bit late in the cycle, but before it's too late, you need to allocate 10-to-15% of your portfolio to preciousmetals/commodities to avoid the shakeout that is coming. I fear that as the USD drops, that percentage may eventually be 30%. Dark clouds have formed on the financial horizon.

Gold, Silver & Uranium Bull Will Continue
BY: Lee Rogers
It has been a little while since my last couple of articles where I called the $640 gold price a bottom and a good buying opportunity. Since that time we have seen gold rise above the $680 mark and silver rise above the $14 mark. Our portfolio of gold, silver and commodity related stocks have experienced tremendous gains in the past three weeks with some netting spectacular gains. I fully expect gold to move past the $700 mark and silver to move past the $15 mark in the very near future.
The IMF has gone on record saying that it was necessary to devalue the USD in order to ensure a vibrant global economy. Iran is waging war against the USD by trading oil in other currencies thus weakening demand for the USD. The U.S. housing market continues to show weakness. All of these factors have contributed to the USD index sinking below the 82 mark. To make matters worse, other fiat currencies have also gained in strength against the USD. The bottom line is that the long term trend of the USD is down and the long term trend of gold and silver is up. Take a look at the rising bottoms on this one year chart on the price of gold shown below.

Since the $560 low on October 6th, 2006 gold has quietly moved higher to its current levels and I fully expect this trend to continue in the short term.
It is important to note that gold has moved up in the past six months despite the fact that the gold cartel has continually attempted to push it down. What’s interesting is that the price of gold seems to go down if there is news that would typically be bullish for the gold price. What is happening is that the gold cartel is anticipating the market reaction to events and throws extra ammunition to push the gold price down whenever these particular events occur. The talking clowns on CNBC were baffled analyzing this situation. Some of them even dismissed the validity of gold as a safe haven which was ridiculous. The Federal Reserve has a number of levers that they can pull in order to push the price of gold down. Do a search for the plunge protection team or the President’s Working Group on Financial Markets and you’ll see the main organization that is in charge of manipulating the market to ensure it doesn’t collapse. Suppressing the price of precious metals is a key weapon that they use in order to maintain people’s confidence in the worthless paper. Of course, you won’t hear anyone on CNBC talk about this stuff because CNBC is a corporate propaganda machine that exists solely to maintain investor confidence in the stock market. They are cheerleaders for the U.S. economy regardless of how bad or crazy things get.
In addition to the recent surge in gold and silver, uranium has really taken off. The junior uranium stocks in our portfolio have been among our best performers of 2007. Uranium has broken the $100 mark and we expect the price to continue its long term rise as demand goes up. China has already announced plans for several new nuclear power plants that are scheduled to go online in the next couple of decades. Not only that but we could see new nuclear power plants in North America and in Europe considering the success that nuclear power has been for France. It is not easy to bring new uranium mines online because of government regulations and other challenges. As a result, I expect the supply will not be able to keep up with the demand causing the uranium price to move much higher. It would not be too far of a stretch to see uranium prices around $200 in the next few years.
The USD is toast. Paper is nothing more than the shadow of money where as gold and silver is money. Everyone should have a good portion of their savings in precious metals as an insurance policy against the insanity of the 21st century financial system. Commodity related stocks provide leverage in this long term commodity bull market.