WHITHER THE GOLD PRICE? That all depends on another question: Whither the global economy? If “to hell in a handbasket” is your answer, then go for the gold: A price of $2,000 an ounce or more, versus the current $1,345.90, looks quite plausible under those circumstances.

The Barron’s outlook, by contrast, might disappoint the most fervent bulls. Assuming that panic about the global economy will begin to subside to mere gut-level fear of the chronic sort, the bull market in gold that began in 2005 will slow its pace in the next few years. By 2015, the average annual price of gold could be $1,500 an ounce, albeit with plenty of fluctuations around that average.

Gold bulls, including gold-fund manager John Paulson, foresee much higher prices for the yellow metal.

….read more HERE

A lot of my old subscribers are sort of “zonked”. These are the boys and girls who had the courage to go along with me when I said, “Buy gold” back in the years around 2000. At that time gold was in the dumps, and gold mining shares were selling like discarded old shoes. Gold was selling in the 250 to 275 range, and at that time, buying gold was akin to buying Smith Corona typewriters today.

Nevertheless, I was able to cajole a percentage of my subscribers into buying gold shares and even some gold coins. After that, I went on a campaign of begging my subscribers to buy gold coins and sit with them. Coins are a pain in the neck to trade, and once holding coins, I discovered that few people play “in-and-out” games with them. For one thing, carrying 100 or so gold coins to the dealer requires a strong leather satchel and a muscular arm. Happily, it’s not a task designed for everyone. Easier to store your gold coins away and then leave ’em alone.

At the time when gold was around 260, my thinking was that at worst, gold should correct back halfway to its old 1980 high at 850. That would mean a rise from roughly 250 to 550, a profitable climb by any reckoning.

It took me a while to realize that gold had entered a new primary bull market, but when gold recorded a new high in each successive year it dawned on my tired brain that instead of a correction, gold was, indeed, in a new primary bull market.

My policy (call it a strategy) since 1990 was to beg, urge, cajole, encourage my subscribers to buy gold. This became easier with the advent of all the new exchange traded funds along with the rise of GLD, GDX, GDXJ, SGOL and so forth.

At the beginning of this site I stated that some of my old subscribers are “zonked” at what has happened to their early investments. These people have seen their original investments mature to the point where their early gold investments have become serious money, even retirement money. To my great pleasure, I’ve received e-mails from subscribers who tell me that my advice on gold has changed their lives. And I think to myself, “Ah, at least my stay on this green earth has done some good.”

The only thing better than keeping my subscribers out of a costly bear market, is to be able to steer them towards a life that is without money worries.

Richard Russell has made his subscribers fortunes. One of the best values anywhere in the financial world at only a $300 subscription to get his DAILY report for a year. HERE to subscribe. Amongst his achievements Richard was in cash before the 2008/2009 Crash and he has been Bullish Gold since below $300

Summer is here. The markets are still undecided on whether to climb, fall, or sit still. So while the market takes its vacation, both gold and silver haven’t taken a break. Gold is now on a nine-week win streak and silver is up over $19.

If prices continue to hold at these levels for another year, many of us who are invested in precious metals miners and explorers may finally reap the rewards we were looking for.

The prices of gold and silver have yet to translate into a fair share price increase for many of the precious metals juniors – including our recent investments into Minco Silver (TSX: MSV) and United Mining Group (CNSX: UMG).

Neither Minco Silver or United Mining Group are producing – but both are very close.

Minco Silver has delineated over 158 Moz of silver, which at today’s prices are worth over $3 billion. Their 2009 feasibility show reserves of 55 Moz, using only $13.57/oz silver – add another $5 to that number and those reserves alone are worth another $275M in revenue. The Company currently has a market cap of $130M – but it was just $110M when our Special Edition Report on Minco was released last week (see The Brink of Milestone) and shares prices of Minco Silver shares were trading at $2.56 (June 11, 2010). Minco Silver is currently trading at $3.05, nearing Raymond James’ target price of $3.35. (see The Brink of Milestone)

United Mining Group currently has a market cap of under $31 million, but had revenues nearing $16 million last year, and a 10Moz silver resource scheduled to go into production within a year. Not only that, their Crescent Mine project sits between two of the world’s largest-ever silver mines and is a potential takeover target given its untapped resource and location. They also have over $6 million in the bank and is fully permitted and financed to go into production. The math is pretty simple – they are extremely undervalued when stacked against comparable companies. (see The Secret Battle)

The biggest difference in valuating juniors is how close they are to actually producing. Having ounces in the ground is one thing, but to actually get it out is a different story. Minco Silver is as close as ever to becoming the largest pure silver play in China. United Mining Group is fully permitted and financed to go into production in less than a year, in one of the largest silver districts in the world.

We’re sure many of you who have invested in precious metals juniors may be scratching your head at the current valuation of your investments based on resource in the ground. The average consensus by institutions is around $80-90 of market valuation for every ounce a gold company has in the ground, but we have seen companies with over 3Moz of gold valued at less than $20 million.

Look at United Mining Group – its trading with the same market cap as its own 2011 projected revenues.

Mining Takes Time – But It’s Worth Every Penny

We have to remember that mining is a time intensive process and look at share prices the same way. The juniors are lagging the rise in precious metals for one major reason: fear.

When the market crashed, many junior explorers were forced to raise money at significantly discounted prices. They issued millions of shares and warrants far below market value and we’re still seeing some of that overhang in the markets.

The economic problems that are driving gold and silver prices will affect the junior markets. The problem lies in the fact that investors fearful of the market implications of a Euro collapse due to Greece will retreat to areas of safety such as gold and the U.S. dollar, leaving the market for capital bone-dry.

There is a very real possibility that risk aversion will outweigh any positive sentiments from a rise in gold prices, putting junior companies with exposure to precious metals under significant downside pressure.

Strike While the Irons Hot

Right now, retail traders have an advantage: risk.

Institutions are still weary of the markets and there hasn’t been a propensity by the larger institutional funds to buy into the resource sector yet. Institutions have a lot less room for errors and thus, have to mitigate their risks. This gives retail investors the advantage to enter into the resource markets before the institutions.

When things settle down and precious metals stay above current prices, perhaps a year from now, these institutional investors will return to the Venture Exchange. When they do, look out. All of that patience could be rewarded and we could see the Venture exchange above 4000.

Right now, the summer has arrived early for traders and we`re starting to see thinner trades and lighter volumes – including that of gold, which is rising despite very low average volumes. If you can stomach investing during the summer, it can be a great time to pick up some cheap shares of juniors.

For now, we continue to look toward companies such as  Minco Silver and United Mining Group. They both have lots of cash in the bank to survive a downturn in the markets, and both are near term producers.

Keep your eyes on the juniors during the summer – there will always be garage sales with bargain prices on a nice sunny day.

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