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Today, I want to leave you with updates, including interesting charts, on three of my Money and Markets columns. If pictures are worth a thousand words, these three charts speak volumes.
And when I say “leave you,” I mean that this is my last column for Money and Markets. From now on, you’ll find me over at Uncommon Wisdom — where I have ANOTHER chart you should see.
Update #1:
Guns …
First, a follow-up on my “Gold, Guns and Spam” column. In that Money and Markets issue, I said it might be a good time to buy gun manufacturer Sturm Ruger (RGR), which ended last week up 34.7 percent from my March 4 mention.
Now here’s the good part … recently Ruger went up even more — hitting a 52-week high — then it pulled back and tested support …
Support is holding, and it looks like Ruger could be ready to make an even BIGGER move to the upside.
Why? Because guns are flying off the shelves! Sales at Sturm Ruger surged from $144 million in 2007 to $174 million in 2008. On top of that, the company had a $48-million backlog of orders at the end of the year.
If you didn’t buy Ruger the last time I mentioned it, you might want to consider adding it to your portfolio now.
Update #2:
Then There’s Gold …
In my February 11 column “Gold and the Fear Trade,” I talked about how gold was tracking the U.S. dollar. Both had become refuges for investors worried about the stock market.
It’s unusual for gold to move with the dollar. And sure enough, that relationship has changed. Now, the dollar may be entering another slump. And gold is at an important inflection point that could send it much higher.
Take a look at this weekly chart …
I thought gold’s recent downtrend would find support at around $800, maybe as low as $765. But it doesn’t have to go that low, and could break out either way – UP or DOWN – from its recent consolidation.
And last week, there was a very interesting development: China announced that it had nearly DOUBLED its gold reserves over the past five years.
I gave a more detailed analysis on my blog. But with China, the facts are never the whole story. We have to ask ourselves: “Why is China announcing this move into gold now?”
I think China is sending a clear message to the United States that:
A. It is sick of the way our government is printing dollars to paper over our banking problems.
B. It won’t take any guff about how it values its currency.
C. Maybe it is seriously looking at buying something other than U.S. Treasuries. China’s Treasuries-holdings climbed 52 percent in 2008 and now stand at about $740 billion, according to U.S. government data.
Then, over the weekend, the World Gold Council announced that it would closely monitor developments at other central banks to determine whether they will follow China’s move.
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Gold is still a very small percentage of China’s foreign reserves. What’s more, while China’s gold holdings are going up, its foreign currency reserves are climbing even faster!
Reuters reports that even with recent additions, gold accounts for only about 1.6 percent of China’s total foreign exchange holdings and is a little more than one-tenth of the value of the U.S. gold reserve, the world’s biggest. It also means gold has actually gone down as a share of China’s total reserves from about 2 percent, based on end-of-2003 prices.
China usually moves in gradual steps. So we may be seeing a new trend developing for China … for gold … AND for the U.S. dollar. But it may take time to really manifest.
Update #3:
More Gold …
Finally, in my Money and Markets column, “Mexico’s Streets of Gold,” from December 17, 2008, I told you about my trip to check out Timmins Gold, a Canadian-listed miner hard at work developing a gold resource in Mexico. I suggested that you could wait before picking this stock up — as Timmins needed some time to secure more funding — it was definitely a stock worth watching.
Timmins spent the first quarter of this year consolidating between C$.40 and C$.50 cents a share. At the same time, the company has made a lot of progress …
The refurbishing of the primary crusher at Timmins’ San Francisco Mine has been completed. The new crushers are important because they are designed and calibrated for the rock type and capacity of the mine to maximize throughput and minimize down time. Now, Timmins has the capacity to meet the planned production of 80,000 ounces of gold per year at a projected cash cost of $412 per ounce.
The gold plant has also been refurbished, and the earthworks for the new heap leach pads are nearing completion. All infrastructure and permitting is in place. Under the current construction plan, the first gold pour at the mine is scheduled to take place in late 2009.
And on a technical basis, the stock looks like it could be forming a new base. Check out this chart …
I think that when gold surges, the big stocks will move first. But juniors like Timmins have a lot of value that could fuel explosive moves when the time is right, too.
I’ll keep my eye on Timmins. And you can look for updates at my new home at Uncommon Wisdom.
I’ll have a new video for you every Tuesday at Uncommon Wisdom … you can check out this week’s video by clicking here. I’ll also have a new column every Friday.
And of course, my videos AND columns will be stuffed full of the charts you like and the insight you expect.
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My colleagues at Uncommon Wisdom include Larry Edelson and Tony Sagami. You can read Tony’s Uncommon Wisdom column on Wednesday and see his new video on Saturday. And Larry kicks the week off with a new column every Monday and a fresh new video every Thursday.
Remember, this new e-zine is FREE. All you have to do to be sure you don’t miss a single one of our columns is to click here and subscribe to Uncommon Wisdom.
Again, I’ve enjoyed writing for Money and Markets very much. I’ve learned a lot along the way, and I hope you have, too. I look forward to welcoming you as a reader of Uncommon Wisdom.
It’s going to be a new chapter in my life, and I hope you’ll be reading along. The sun is rising in the West, my friends, as a new age of profits dawns in countries like China and Australia. Yes, there are risks along the way as there are for any investment — but the opportunities are simply astounding.
I hope to see you there.
Yours for trading profits,
Sean
P.S. My blog has moved. Remember to check out my daily updates. And you don’t want to miss a single one of my Uncommon Wisdom columns — click here to subscribe.
About Money and Markets
For more information and archived issues, visit http://legacy.weissinc.com
Money and Markets (MaM) is published by Weiss Research, Inc. and written by Martin D. Weiss along with Tony Sagami, Nilus Mattive, Sean Brodrick, Larry Edelson, Michael Larson and Bryan Rich. To avoid conflicts of interest, Weiss Research and its staff do not hold positions in companies recommended in MaM, nor do we accept any compensation for such recommendations. The comments, graphs, forecasts, and indices published in MaM are based upon data whose accuracy is deemed reliable but not guaranteed. Performance returns cited are derived from our best estimates but must be considered hypothetical in as much as we do not track the actual prices investors pay or receive. Regular contributors and staff include Kristen Adams, Andrea Baumwald, John Burke, Amber Dakar, Dinesh Kalera, Red Morgan, Maryellen Murphy, Jennifer Newman-Amos, Adam Shafer, Julie Trudeau, Jill Umiker, Leslie Underwood and Michelle Zausnig.
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This investment news is brought to you by Money and Markets. Money and Markets is a free daily investment newsletter from Martin D. Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Dr. Weiss is a leader in the fields of investing, interest rates, financial safety and economic forecasting. To view archives or subscribe, visit http://legacy.weissinc.com.
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