67 WALL STREET, New York - December 17, 2013 - The Wall Street Transcript has just published its Gold and Precious Metals Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: Precious Metals - Lower Gold Price Environment - Precious Metals Exploration and Production - Increasing Capital Expenditures - Emerging Markets Silver Consumption - Mining Safety and Environmental Concerns - Gold Production Cost Structures - Gold Price Stabilization
Companies include: Gold Bullion Funds and Gold Mining Companies
In the following excerpt from the Gold and Precious Metals Report, an expert analyst discusses the outlook for the sector for investors:
TWST: Gold has been not a great performer this year. What's going on?
Mr. Schiff: Well, obviously some of the people who made a lot of money in gold over the years may have decided to cash in, but I think - more likely I think the speculators, who finally, finally got into the gold market over the last couple years decided to get out and cut their losses, because I think they saw the big run-up in the stock market, they believed all the hype about the recession being over, about the Fed being ready to tighten and take away the QE, and I think they believe that the case for gold was undermining.
So they sold their gold and went back into the stock market, because that's where a lot of that speculative money came from. It came from stock market investors, who had lost money in the market over five or 10 years, didn't own any gold, and then after seeing gold go up four or five times decided that they would want to buy some. And they got shaken out of the market in its last correction, and I think that's very healthy, because I think the next leg up in the bull market - I think we have a long way to go before some of those speculators get back into the market, and of course by the time they do the prices will probably be well in excess of $2,000 an ounce.
TWST: Now when you say bull market, bull market for equities or for gold?
Mr. Schiff: Bull market for gold. Yes, gold has been in a bull market for 12, 13 years, unlike equities that have been in a real bear market, even though the Dow made a new high recently. If you look at the Dow, yesterday 16,000 on the Dow, if you and adjust it for inflation, even the government's version of inflation, the Dow Jones is lower than it was 12, 13 years ago. That's not the case for gold. So gold has been in a bull market in real terms during that period of time, stocks have not.
TWST: Even if you adjust gold for inflation, it's still better than it was at the last prior peak?
Mr. Schiff: No, not the prior peak. I'm talking about from the beginning of the bull market. So if you think of the bull market started around 1999, when the gold was around $260 an ounce and look at where it is now, even after the correction, at around $1,300 - that has certainly outpaced inflation. But if you look at the stock market, where the Dow peaked out around the 11,000 at that time and now it's around 16,000, if you look at it, the Dow is about 30% higher in price, but other prices over that 12-, 13-year period, the CPI is up more than 30%, even the way the government calculation.
TWST: Which may not necessarily be accurate?
For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
- Basic Materials Industry
- Commodity Markets
- Gold Price
- bull market