Weekly Market Report 10/31/11

GOLD

What a week for Gold investors, Gold was up $111 per ounce (or 6.79%) in just five days.  It broke through the $1,700 psychological resistance price level on excellent volume and global demand. This breakout signals the acknowledgment that more quantitative easing is coming. The monetary stimulus (printing over 1 Trillion Euros) is the key element in last week’s eurozone crisis solution. The high probability that we will see QE3 in the United States should drive both Gold and Silver prices to new all-time highs. The New York Federal Reserve President, William Dudley, has said that the central banks have “not yet run out of bullets” and that a third round of quantitative easing is still a possibility.

The European Leaders reached a deal on Thursday which drove up the equity and precious metal markets around the world.  A combination of discounting Greek debt, recapitalizing the problem banks, and a stimulus program of over one trillion euros for nations with huge debt has apparently excited and provided renewed confidence for many financial professions. This demand for precious metals was also fueled by increased talk in Washington DC about another round of monetary easing (QE3) from the Fed, based on a report that US Consumer Confidence is at a 2 ½ year low.

Gold making a major breakout and closing at $1,747.20 per ounce last Friday is very bullish for the direction of the market. I would expect to see $1,700 to $1,750 short term trading ranges before the $1,800 level is tested.

SILVER

If last week made Gold investors happy, silver investors must be ecstatic. Silver rallied over $4 per ounce last week, closing at $35.28 per ounce on Friday. That is a whopping 13% increase on excellent trading volume all week. Last week, European leaders agreed to a monetary stimulus package to solve the debt crisis.  This agreement by European financial ministers has temporarily sidelined concerns that Europe’s problems would lead the world into a serious recession. Silver should be one of the biggest beneficiaries of any European monetary stimulus. I look for silver to establish a new $33 to $38 per ounce trading range, poised to build a base for the next breakout above $40.  Timing for this breakout will take its lead from gold trading.

Recommended investment commitment and diversification:

Precious Metal commitment: Minimum of 35 % of investment capital

Diversification:  Gold 66%, Silver 24%, Platinum & Palladium 10%

Diversification includes long term investment quality rare coins and short term bullion products.

WORLD’S LARGEST GOLD COIN

Australia has unveiled the world’s largest gold coin. It weights a massive 1,000kg, or 32,150 ounces of  gold (One metric ton) with a face value of $1 million dollars and is valued currently at $58,000,000. The Perth Mint achieved this record-breaking triumph with the successful casting of the world’s largest gold bullion coin, made from 99.99% pure gold.

2012 Hyperinflationary Study Booklet just released

I am very proud to announce that my 2012 Hyperinflation study has been completed. The booklet, titled “Is Hyperinflation the US Government’s Only Way Out?” is being mailed out today. The study answers two very important questions, “Is a gold standard possible?” and “Can gold be confiscated again?”

This 32 page booklet is my 2^nd edition and completely updated with eight more pages than the 1^st edition, released last May. A combination of great client suggestions on how to improve my 1^st edition, along with all the global and domestic events that have occurred since May 2011, has allowed me to completely update the study.

If you do not receive your copies by next week, please contact my office immediately. Once again, I am asking for your opinions and/or suggestions to improve the 2013 edition.

RARE COIN UPDATE

New CoinStats

I believe that my CoinStats report is the best investment tool for rare coin investors. CoinStats is an in-depth statistical analysis of popular rare coin series that allow investors to identify the best values in certified rare coins. I am proud to offer this unique and outstanding investment tool exclusively to our clients. The October CoinStats update is now available for $20 Gold Saint Gaudens, $20 Gold Liberties, and Morgan & Peace Silver Dollars.

While the collector coin market continues to be very weak, the high end gold and silver investment quality rarities (over $50,000 each) are setting record prices at auction. The best values and opportunities are in the middle area ($3,000 to $49,000) where the market is undervalued. The CoinStats Report provides a list of my recommended certified Investment quality US gold and silver coins listed on the best value page.  These are not the overly hyped modern issue bullion coins or low grade circulated coins, they are graded MS63 or higher, pre-1934 gold and silver U.S. coins that have a proven track record of appreciation.

On November 16th I am heading to Baltimore for two reasons. 

Baltimore Coin Expo

First, I’ll be attending the Baltimore Coin Expo, which is the last major coin convention of this year. I’ll be attempting to purchase investment quality, best value, certified rare coins that are listed in the current CoinStats report.  

Political Action Committee (PAC)

Second, as chairman of the rare coin and precious metal communities Political Action Committee (PAC) I am hosting a fund raiser for Senator Tom Carper.  Senator Carper is a key member of the Senate Finance Committee and a friend of the community. The Gold and Silver PAC will hold three or four fund raisers for incumbents and candidates for Federal office before the 2012 election.  The purpose for these fund raisers is to show our industry support for federal legislators and candidates for Congress who understand the issues of the rare coin and precious metal community.  I’ll keep you updated regarding the fund raiser for Senator Carper in next week’s “Weekly Market Report”.

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All statements, opinions, pricing, and ideas herein are believed to be reliable, truthful and accurate to the best of the Stuppler & Company’s knowledge at this time.  Stuppler & Company disclaims and is not liable for any claims or losses which may be incurred by third parties while relying on information published herein.  Individuals should not look at this publication as giving finance or investment advice or information for their individual suitability.  All readers are advised to independently verify all representations made herein or by its representatives for your individual suitability before making your investment or collecting decisions.