November 1, 2007

Grant's News Letter 

Wow, gold hit $800 TODAY! Gold is still under valued. Mainstream sources are now calling for $1000-$1500 gold. If gold hit a high of $840 an ounce in the 1980’s and the value of the US dollar has fallen by half since then, gold is right on track to hit $1500.

Silver is the BEST buy I can see right now. Corrected for inflation silver should be around $25 an ounce. Its currently trading at the mid $14 dollar range and poised to hit $15 before the end of the year. If gold hits $1000 I see silver surging to $50 in its wake. And if it hits double its 1980’s high as most experts believe gold will, expect to see silver raising until it nears the $100 dollar an ounce range. Go long Silver, no need to play straddles, go long and don’t look back!

Last month I called for oil to go to $95 by year end. Well Oil is already there. Oil may well be above $100 an ounce by year end, especially if the war drums to invade Iran continue to be beaten. A recent Zogby poll had 52% of polled US citizens in favor of a war with Iran, this is dire news to the value of the US dollar, but great for those who can take advantage of the volatility this move will make on the markets.

Copper is a sleeper as well as silver. In Jan. 2007 the Chicago branch of the Federal Reserve Bank speculated that if copper prices continue to raise the penny may be valued at a nickel. Even the Financial Times of London, the premiere financial newspaper in the world, is telling its readers to watch for the current down trend in copper to end and the metal to surge up as 2008 begins.

The recent move by the Federal Reserve to do a .25 cut had the expected effect of triggering the dollar to further weaken. With such a low interest rate there is little reason for foreign investors to be attracted to the dollar. As more countries dump their dollar holdings for other currencies the value of the dollar will fall further.

Physical assets are all looking good in the face of a weakening dollar, as the US Dollar continues to fall, it will take more US dollars to buy just about anything.