Monday, October 27, 2008

What Gold Bugs Shouldn't Do

“I believe the gold juniors offer the best value for your paper dollar going forward,” says Ed Bugos of the violently beaten-down junior mining sector. The Canadian Venture Index, the bellwether of juniors, is down a nauseating 70% from its 2007 high.
This time what gold bugs should NOT do:
~Don't be overly short the stock market at this stage of the collapse.
~Don’t slow down your gold buying just because the market is down. Buy a lot of gold -- coins and bars. Buy as much as you can before it breaks through $1,000. Then hide it.
~Don't buy the GLD streetTRACKS, unless you're just trading.
~Don't buy gold from your bank.
~Don’t put all your eggs in one basket. Diversify your wealth between tangible assets, like gold, silver and platinum, or even real estate, and continue selectively accumulating bargains in the equity sphere. Diversify geographically.
~Don’t invest more than 20% of your wealth in junior miners. It is not a safe-haven panacea. The rewards are potentially high, but the risks are, too.
~Don't keep all your wealth in gold, because the government will one day probably come for it.

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