Still bullish on gold – $1500 in 2010 and $2000-$3000 longer term

December 24, 2009

Specialist gold analyst Jeff Nichols, is still bullish on gold despite the recent price correction and would not be surprised to see $1500 gold next year and higher levels to come.

Author: Jeffrey Nichols

Gold has enjoyed a long and enviable climb, rising some 380 percent from a cyclical low near $255 an ounce in April 2001 to an all-time high just over $1,225 early this month.  Nevertheless, the bull market in gold has a long way to go – both in magnitude and direction. 

Looking ahead to 2010, don’t be surprised to see gold trade at $1,500 or higher sometime during the New Year.  And that’s not all:  I’ve been telling clients that the yellow metal’s price will continue its long-term upswing for at least a few more years, very likely reaching $2,000 an ounce . . . and possibly hitting $3,000 or more before the gold price cycle begins its next long-term cyclical “bear” phase. 

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Gold rises 1.5% as U.S. dollar falters

December 24, 2009

Greenback dips, easing from three-month highs

Humeyra Pamuk

Thursday, December 24, 2009

London — Gold prices rallied more than 1.5 per cent on Thursday to above $1,100 an ounce as the dollar lost ground and on the back of robust investment flows betting on higher bullion prices.

Other precious metals took their cue from gold’s strength with both palladium and platinum rallying to their highest in about a week at $375 an ounce and $1,4560.50 an ounce respectively.

Spot gold was at $1,104.05 an ounce by 1035 GMT, versus $1,087 an ounce late in New York on Wednesday. Bullion tumbled to a seven-week low of $1,074.10 an ounce earlier this week.

Analysts said the price moves were partly exaggerated due to low liquidity because of the Christmas holiday period, but the fundamentals which sent gold to an all-time high of $1,226.10 an ounce in early December were also still in place.

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Silver Dragon Terminates Agreement to Sell Erbahuo Mine

December 23, 2009

In a press release, Silver Dragon Resources Inc. (OTCBB: SDRG) announced the termination of its previously announced definitive agreement to sell its 70% equity interest in the Erbahuo polymetallic project in China and its 70% ownership in the Chinese subsidiary, Chifeng Silver Dragon Resources & Technologies, Ltd.  In lieu of selling the mine, Silver Dragon will implement an alternative strategic plan which includes a 2010 listing on a major Canadian stock exchange.

Under the original signed definitive agreement the Chinese investor committed to pay Silver Dragon a deposit of RMB 1.8 million, or ~US$260,000 within three business days after signing the definitive agreement, with the balance of RMB 4.2 million, or ~US$622,000 due upon Chinese Ministry of Commerce approval. 

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Dejour Bolsters Board of Directors at 2009 Annual General Meeting

December 23, 2009

Renews Shareholder Rights Plan, Adopts new Stock Option Plan and Augments Capital Structure

VANCOUVER, Dec 22, 2009 (BUSINESS WIRE) –

Dejour Enterprises Ltd. (NYSE-AMEX: DEJ / TSX: DEJ) is pleased to announce the election of Mr. Stephen R. Mut, M.Sc. Environmental Eng. and Mr. Darren Devine, LLB as new members of the Dejour Board of Directors. Re-elected at the AGM are Mr. Harrison Blacker M.Sc. M.Eng., Mr. Craig Sturrock LLM QC, Mr. Richard Patricio LLB, Mr. H. Robert Holmes and Mr. Robert L. Hodgkinson.

Mr. Mut will also serve as Co-Chair of the Board of Directors. Steve has been a Special Assistant to the CEO and COO for the past 7 months. He brings to the company extensive experience. Most recently he served as CEO of the Shell Unconventional Resources unit of Shell Exploration and Production Company. Before retiring from Shell in mid 2009, Mr. Mut led the team responsible for research and development of a new enhanced oil recovery method in northwestern Colorado’s oil shale resources known as The Mahogany Research Project, field-testing the technical and environmental viability of Shell’s in situ (in ground) process.

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Successful Exploration Investing: Interview with Brent Cook

December 22, 2009

No drill results? No worries. Good geology, good management, a good cash position and a good stock price are good enough to coax renowned exploration analyst (and geologist) Brent Cook into buying junior prospect generators and explorers. He finds his sweet spot being near the top of the batting order. If he waits for drill results to confirm what he expects them to reveal, he may miss the best time to buy. With year-over-year returns on his Exploration Insights portfolio averaging 80%—and one superstar at 10 times that!—Brent’s clearly hit a few homers with his strategy. But in this exclusive interview, he cautions Gold Report readers against believing everything you read and hear. He says, “It’s really, really critical to evaluate what a company’s telling you.”When we chatted in August, you were looking at a gold price in the $900 neighborhood, indicating that fear of another financial disaster was driving gold prices. Since then, gold broke through $1,200 and has now corrected down to about $1,120. Is fear still the driving factor or has the dynamic changed?

The Gold Report: When we chatted in August, you were looking at a gold price in the $900 neighborhood, indicating that fear of another financial disaster was driving gold prices. Since then, gold broke through $1,200 and has now corrected down to about $1,120. Is fear still the driving factor or has the dynamic changed?

Brent Cook: I was probably wrong in my assessment at the time. I didn’t take into account the amount of liquidity—money being pumped into the system. I think what is driving gold now and drove it up through $1,200 is greed much more than fear. In my view, gold has become part of the global asset bubble—which includes foreign real estate, stock markets and base metals. So it’s actually greed that’s been driving gold, at least over the past few months.

TGR: How long can greed support a rally?

BC: It’s all tied to the dollar carry trade and the irrational actions of the crowds. You can borrow U.S. dollars at essentially negative rates and invest it in any other asset. Fund managers and bankers are just piling into whatever is hot, and that includes gold. The problem is that new participants in the gold market really don’t view gold as an alternative to the U.S. dollar and don’t fear fiat currencies as many of us do. They don’t believe gold is money; it’s just another asset to pile into with the crowd.

I am concerned about what happens if the dollar carry trade gets reversed and/or if the Fed jacks up interest rates. Then we’d see gold come crashing down and maybe the market as well. Except for the U.S. dollar, this has been an extremely positive year for almost anyone investing in the markets.

TGR: So you’re looking at the asset managers piling into gold as the “flavor of the month” lately. Would the Fed have to raise interest rates for asset mangers to tire of gold and just dump it on the market?

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Silver Dragon Closes $1 Million Private Placement

December 22, 2009

In a press release, Silver Dragon Resources Inc. (OTCBB: SDRG) announced the closing of a private placement consisting of 3,739,198 units in the Company at a price of US$.28 per unit, for gross proceeds of US$1,046,976. Each unit is comprised of one restricted common share and one common share purchase warrant. Each warrant entitles the holder to purchase one common share of the Company at an exercise price of US$.50 per at any time within one year from the date of issuance.

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Avanti Raises $2.6 Million Via the Exercise of Warrants

December 22, 2009

In a press release, Avanti Mining Inc. (TSX-V: AVT) announced that Resource Capital Fund has voluntarily exercised 12,221,019 warrants that do not expire until November 5, 2013 at an exercise price of $0.216 for proceeds to Avanti of $2,639,740. Use of proceeds will be for permitting applications and general corporate purposes.

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Holiday Season Positive for Energy Stocks

December 22, 2009

If 2010 follows the pattern of the past 15 years, we are approaching the start of a seasonal climb in the price of crude oil that could present a good investment opportunity in energy-related stocks.

Oil is down from its 2009 peak of $81 per barrel seen in October, but we remain constructive on energy stocks given the improving economy and positive seasonal factors heading into the New Year.

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Top Investment Advisor Don Coxe Thinks Gold Stocks May Outperform Gold Bullion

December 22, 2009

For the past several years, we have introduced several emerging growth mining companies which we believe represent significant upside  potential.  We have been a big believer in both precious and base metals and continue to believe that there is tremendous upside opportunity for our companies heading into 2010 and beyond.  Part and parcel to our mining companies, we also are big believers in the metals themselves, particularly gold and silver.  We have always believed that the returns resulting from an investment in gold (and silver) mining stocks should outperform an investment in the physical commodity.  And with gold’s (and silver’s) recent run, we expect mining companies to advance as well.

As it turns out, we are not the only ones with that belief.

According to Don Coxe, investment advisor and commodities analyst, “Notwithstanding the fact that we’ve had this pullback in gold prices, that the value of gold stock should be higher, and therefore we are sticking with our view that you need to have about one-third of your commodities exposure tied into precious metals which are driven by the price of gold, whichever precious metal it is, they are consensually priced off the relationship with gold.”

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Banks with Influence Got Access to Bailouts, More Money

December 22, 2009

NEW YORK, Dec 21 (Reuters) – U.S. banks that spent more money on lobbying were more likely to get government bailout money, according to a study released on Monday.

Banks whose executives served on Federal Reserve boards were more likely to receive government bailout funds from the Troubled Asset Relief Program, according to the study from Ran Duchin and Denis Sosyura, professors at the University of Michigan’s Ross School of Business.

Banks with headquarters in the district of a U.S. House of Representatives member who serves on a committee or subcommittee relating to TARP also received more funds.

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