Lombardi: Expert Stock Market Commentary & Forecasts, Financial & Economic Analysis Since 1986
Stock Market Commentary & Forecasts, Financial & Economic Analysis

Welcome to Profit Confidential • Monday, May 21, 2012

Yellow Looking Good These Days

Thursday, November 23rd, 2006
By Michael Lombardi, MBA for Profit Confidential

With the speculators now gone home with their tail between their legs, the bull market in gold continues on slowly but steadily.

Gold bullion closed yesterday at $635 U.S. per ounce, now up 13% from their early October 2006 price correction low.

—The Dow Jones U.S. Gold Mining Index is up 12% from October 4, 2006.

—The resource and commodity stock rich S&P/TSX Composite (Canada’s equivalent of the NYSE) continues to post new record highs almost daily.

As a reader of PROFIT CONFIDENTIAL you’re obviously aware of my bullish opinion of gold bullion. I simply believe “too many” U.S. dollars in circulation will eventually lead domestic and foreign investors to seek a more stable currency. And lacking any real fiat (paper) currency alternative to the U.S. dollar, gold could be the currency of choice.

There are many quality gold stocks that trade on American and Canadian stock exchanges. Again, as a play, Americans should consider buying gold stocks on the major Canadian exchange so they can also profit from a decline in the value of the U.S. dollar and increase in the value of the Canadian dollar.

I predicted early in 2006 that gold would be one of the star performers of the year. Having started 2006 at $520 U.S. per ounce, gold’s already up 22% for the year. Some quality gold stocks are up even higher, some having doubled in price in 2006.

If you haven’t added gold to your portfolio as an investment and as a hedge against the weakening U.S. dollar, it’s still not too late. Stick with large, quality gold producers because yellow is looking good these days.

NEWSFLASH–Core inflation in the U.S. rose a less-than- expected 0.1% in October bringing core inflation up 2.7% from last year and down from 2.9% in September. These numbers bode well with my theory that the problem in the U.S. today is a threat of deflation, not inflation.

Happy Thanksgiving to all our American readers!

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Profit Confidential AuthorMichael bought his first stock when he was 17 years old. He quickly saw $2,000 of savings from summer jobs turn into $1,000. Determined not to lose money again on a stock, Michael started researching the market intensely, reading every book he could find on the topic and taking every course he could afford. It didn’t take long for Michael to start making money with stocks, and that led Michael to launch a newsletter on the stock market. Today, Michael only employs the top market analysts and editors. Some of our recommendations have posted gains in excess of 500%! Michael has authored and published over one thousand articles on investment and money management. Along the way to building Lombardi Publishing Corporation, now with over one million customers in 141 countries, Michael became an active investor in real estate, art, precious metals and various businesses. Readers of the daily Profit Confidential e-letter are offered the benefit of the expertise Michael has gained in these sectors. Michael believes in successful stock picking as an important wealth accumulation tool. Married with two children, Michael received his Chartered Financial Planner designation from the Financial Planners Standards Council of Canada and his MBA from the Graduate Business School, Heriot-Watt University, Edinburgh, Scotland.Follow Michael and the latest from Profit Confidential on Twitter

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