50 years of suppressing silver (and gold), page-15

Loki,

I think your strategy will do great. After the 1980 peak gold stocks as a group had a really good time and outperformed bullion for a few years (just the opposite happened in the late 1970s as is generally the case now). In 1998 I saw Pierre Lassondes DOW:gold ratio chart showing bullion undervalued, dived into gold companies and lost money (I was young and didnt have much anyway). A better strategy would have been to scale in over 5 years, 1998-2002. The same applied to the 1980s too I guess, slowly switching from gold investments into bonds/financial stocks.

I plan on being more disciplined this time around on the next cycle... but before then expecting another intermediate peak for gold stocks similar to late 2003, 2006 and 2008. Various factors are driving us there IMO over next 6-12 months. I intend taking some profits then and will let you know of course and my reasons.

20 yrs ago both S&P500 and Gold were around 350/400. So yeah, the chart is correct. Even better gold fell in the 1990s while S&P roared, so these long-term comparisons will only magnify golds out-performance in future, further enhancing its appeal to late-comers.

Rowingboat