Trade your dollars for gold
Its common knowledge the price of gold is inversely proportional to the value of the dollar – that is, when one goes up, the other goes down. At least, it has ever since the Nixon Shock in August 1971when President Nixon changed the valuation of the dollar from gold to an open monetary exchange. And we hear every day more evidence of the growing weakness of the US dollar – the yields on Treasuries go up, the cost of crude oil increases, concerns about inflation from the Fed. So what do you do about the devaluation of the dollar? You can’t hoard your cash because of inflation and devaluation, so you have to invest it in something. Banks and bonds are yielding microscopic returns so that just leaves the stock market. Here are four stocks to take advantage of:
Invest in a gold ETF. SPDR Gold Shares (GLD) is up 17% since the middle of August and shows no sign of slowing down anytime soon. Another bullish indicator is the MACD (Moving Average Convergence Divergence) histogram crossed the signal line a week ago – a good sign the stock price will continue to rise.
Buy a gold mine (or the next best thing).
Agnico-Eagle Mines Limited (AEM) is trading well below its 50-day moving average, which means it’s undervalued, and the MACD just crossed the signal line, which is a positive technical indicator. Agnico-Eagle Mines owns interests in mines in Canada, Finland, Mexico, and Alaska.
Aurizon Mines Limited (AZK) owns gold mines in Canada and experienced a 24.4% quarterly revenue growth year-on-year. Its MACD just crossed the signal line which is a good indicator the stock price will continue to rise.
Northgate Minerals Corporation (NXG) has had a free cash flow growth of 206.63%, a low P/E ratio indicating it’s undervalued, a 7.13% return on equity, and a price to free cash flow ratio of 19.34, one of the highest in the sector. The MACD also just crossed the signal line with this stock as well, signaling an opportunity to buy.
Buy the real thing. You can go to GovMint.com and buy US gold coins, international gold coins, bullion, paper currency, gold and silver jewelry, and even shipwreck and treasure coins. And for the next two weeks you can buy two 1783 American Revolution silver coins for only $149 – that’s $129 cheaper than anywhere else. These are the same coins Ben Franklin, George Washington, and Thomas Jefferson had jingling in their pockets. The sale ends November 30th.
Be sure to subscribe to my RSS feed to be automatically notified when the next article is posted or follow me on Twitter. You can also have new articles delivered to your email inbox by entering your email address in the “Get Updates by Email” box in the upper right hand corner. Thanks for reading!
You might also like to read:
Tom @ CFB
Buying Gold
Bytta@151DaysOff
David
Big and Tall
I recently made a post on my blog that gives my views on where gold is going and how you can buy it directly: http://www.onlineinvestingguru.com/2009/11/18/so-whats-with-all-this-gold-talk-then/
Let me know what you think
John
John – thanks for the comment! I wish I’d known about Bullion Vault when I was writing the article. Buying gold from them is easier and cheaper than investing in one of the gold ETF’s (cheaper gold, lower overhead).
I hope everyone who reads your comment checks out your article.
- David
David@MBAbriefs.com
I admire writer that wrote remarkable articles that are really useful to the readers and bloggers like me for you teaches many lessons and provide endless useful information. Hope to read more from you guys and Thanks a lot for the post! I look forward for your next post.
Great article. Definitely gives me some things to think about. I've been in the jewelry business for a while and I have first hand knowledge about this stuff. People really do need to get in not just because it's a hot market but because it's a good investment long term.