If we’re right about where the price of gold is headed, the general public will someday clamor to buy all things gold. While gold stocks will be where the real leverage is, the rush will start with gold itself. As a gold editor, I have a very natural question: is there enough to go around?

According to the U.S. Census Bureau, there are 6.783 billion earthlings. Meanwhile, CPM Group, a highly respected industry organization, estimates there are 4.8 billion ounces of above-ground gold in the world. And this includes jewelry, electronics, and dental. So, even if everyone around the world volunteered to have their chain, cross, or tooth melted into a coin, we’re already short. Those towards the end of the line are out of luck.

However, it’s worse than that. Of all the physical metal ever mined…

2.1 billion ounces, or 43%, is found in jewelry, decorative, and religious items. Private stock – ...

“Super trader” Jeff Clark says oil stocks are oversold right now. Writing in today’s Growth Stock Wire, Jeff says the bullish percent indicator for the oil sector, BPENER (below), is flashing a buy signal for oil stocks.

This from Jeff:

BPENER is a momentum-based indicator that generates buy and sell signals based on oversold and overbought conditions. The oil sector is overbought when BPENER rallies above 70 and then turns lower. The four most recent sell signals are marked with red circles. Each signal was profitable for anyone taking a short position on the oil sector.The oil sector is oversold whenever BPENER drops below 20. It generates a buy signal (the blue circles) when it turns higher from oversold levels. The last time we got a buy signal from this indicator, back in March, my Advanced Income subscribers took on three trades. Each of them generated at least a 25% ...

From the close of trading in New York on Wednesday afternoon at 5:15 Eastern Time…and the close of trading 24 hours later on Thursday at the same time…the U.S. dollar lost about 90 basis points. That’s a big drop. Gold’s response? Up three bucks…and silver was actually down on the day.

Yesterday’s low tick on the U.S. dollar occurred around 2 p.m. in New York at 79.72 cents…plus or minus a couple of ticks. Gold’s peak price in the first few days of June was around $990…when the dollar printed a low of about 78.70 cents. In five weeks, the U.S. dollar has gained a full cent [one percent and change], while the US$ gold price has been hit for 77 big ones. That’s a drop of 7.8%.

The point I’m making here is that this decline in the gold and silver price over the last five weeks has had

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What if deflation wins? While we think the odds are strongly stacked against it, particularly given the government’s furious pace of money printing, the prudent investor understands – and respects – the time-tested adage, “Nothing is guaranteed.” So while our chips sit squarely on the spot marked “inflation,” what will happen to gold stocks if we’re wrong?

The Great Depression Speaks

The most notable example of what happens to gold stocks in a prolonged deflationary environment is the Great Depression. However, the United States was on a gold standard at the time, so miners had a guaranteed selling price – which was a good thing for them, because their operating costs were plummeting. So the comparability isn’t perfect, but let’s see what we can learn.

When the stock market crashed in 1929, gold stocks were part of the general wreckage (sound familiar?). The market then rallied and recovered almost 50% of its losses

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“Gold Isn’t Going To $2,000 An Ounce” is both the headline and the announcement of Jeff Clark at CaseyResearch.com, a conclusion he apparently reached after he “decided to take a fresh look at calculations that could be used to appraise gold’s upside potential.”

Confirming rumors that I am “always disagreeable,” I am absolutely sure that gold will soar in price, as in To The Freaking Moon (TTFM), as a result of the fiscal and monetary malfeasance as we see today, as that is what has ALWAYS happened in the last 4,500 years of governments acting like grubby, corrupt morons, particularly when using a fiat currency, which always expands too, too much and for too, too long.

Naturally, being paranoid and argumentative, I figure that Mr. Clark is trying to pick a fight with me, just like all the other people in the world who are out to get me,

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Gold isn’t going to $2,000 an ounce. Before you gag on your coffee or suffer chest pains, allow me to explain.

We’re about eight years into the bull market, and gold has breached the $1,000 level twice and has spent weeks trading above the old high of $850. Some observers are now saying that gold’s pretty much had its day and that once the recession is over, it will retreat for good.

However, the four-digit gold price we’ve seen so far is with no price inflation to speak of, no effects of the atrocious increase in the money supply, and despite a rising dollar. What happens to gold when each of those pictures gets turned upside down – high inflation, excess cash jolting the economy, and a falling dollar? After all, gold’s performance to date has been powered only by general anxiety, not by any visible erosion in the dollar’s value.

I decided

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Notes from theInvestment Underground

Tuesday, March 31, 2009Recoleta, Buenos Aires, Argentina

Team Obama talks bankruptcy… But he doesn’t really mean it… Politics continue to drive the economy… The most ruinous CEO in history… Deutsche Bank: This crisis is “far from over”… Bailouts reach $10.5 trillion and counting… Gold is where the smart money is right now… Money supply increases… And more!

*** Is Team Obama finally coming to its senses? Instead of keeping the fatally wounded U.S. auto industry on a drip feed of tax dollars, Obama is considering allowing GM and Chrysler to enter bankruptcy.

A headline in the WSJ reads “U.S. Threatens Bankruptcy for GM, Chrysler.” How backwards has the U.S. economy become when bankruptcy for a failed company is seen as government intervention? In a functioning economy companies go into bankruptcy when they fail. It’s just a

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Notes from theInvestment Underground

Tuesday, March 24, 2009Recoleta, Buenos Aires, Argentina

The 15-year depression is coming… Drink yourself to death! Martin Weiss’s deflationary outlook… A sucker’s rally with legs… Protecting your wealth from inflation… Jeff Clark: the S&P will go below 600… The truth behind China’s dollar holdings… Big government gets bigger… And more! 

*** “This is the big one,” says Republican Congressman Ron Paul, who yesterday said the depression will last 15 years. It makes a nice change from all the hooting and wailing about a bottom being in for stocks.

“The U.S. government just won’t allow the correction the economy needs,” says Paul, citing the mini-depression of 1921, which lasted just a year. This was because insolvent companies were allowed to fail. “No one remembers that one. They’ll remember this one, because it will last 15 years.”

Paul

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With the New York gold market closed on Monday…trading added up to a big zero. Don’t forget that well over 90% of all trading volume in both gold and silver occurs out of New York. So when the boyz have a long weekend, there isn’t much activity.

However, starting at 8:00 a.m. in Hong Kong on Tuesday morning, gold tacked on around $20 from there…right until the London open…which is a big move for that time of day, as the Far East markets are pretty thinly traded. Nothing much happened in early European trading, but once floor trading started on the Comex in New York yesterday morning, gold added another $13 dollars or so. That ended about 12:20 p.m. when it appeared that someone tapped on the brakes and gold went sideways from there. The usual N.Y. commentator offered this assessment…”Estimated volume was 146,365 lots with a switch effect of 12,978.

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