GOLD

Citigroup says gold could rise above $2,000

Fair Value for Feb Gold is currently $912

Current Probability of 1000 gold by/before 2010 99%

Current Probability of 1200 gold by/before 2010 90%

Current Probability of 1500 gold by/before 2010 71%

Current Probability of 2000 gold by/before 2010 11%

GOT GOLD?

AFUND H1 2009 FORECAST

H1 2009 is positive for Yellow Gold, Black Gold (Oil) and Silver

Comments:

•Physical Gold is selling a premium – Why?
•Asian Central Bank (CB) buying more than offsets European CB selling
•While there is short term strength in the US $, fair value is .78 not .88 (12/05/2008)
•Gold/Silver ratio of 87 is too high – it should drop 65 or lower.
•With base metal mining supply dropping, Silver as a byproduct supply is reduced
•High end Silver jewelry demand is growing
•2010 Silver Astrology is very strong

GOLD INVESTING & TRADING

INVESTMENT

•Hold Gold as both an investment & hedge.
•Gold is the Cheapest insurance against both declining US dollar and inflation.
Gold and precious metals are can perform well in either an inflationary or deflationary environment.
•Strong Demand underlying from Chinese India Middle East Japanese, Russia, and smart money US & Europe.

Gold Trading Targets come earlier and revised higher

2009 TRADING TARGETS: GOLD $1005 & SILVER $14/$16

2010 TRADING TARGETS: GOLD $1200 & SILVER $21/$26

Current Gold Fair Value $912
Silver Fair Value is $14 as an Investment and $11 as a Commodity

Gold is a commodity, currency, inflation measure and crisis metal

Q1 2009 Gold FV $912/955 or $1005? =

Commodity FV: $840 +

Currency FV: $940 +

Inflation Metal FV: $820 +

Crisis FV: $1045/1200 or $1400?

Weaker US Dollar Same Time Next Year

.78 Fair Value US Dollar Index (.88 12/5/2008)

As with Currency “release” our forecast has been:

“Once oil drops to 46 or below, it will no longer have a negative effect on gold/silver and will be positive” [as gold/oil ratio far from 10-1]

1. Gold and Silver are recommended multiyear investments for both wealth preservation and wealth creation.

2. Ben Bernanke was and will continue to be great for Gold

HYDE PARK SOAPBOX
If $400 gold indicates the presence of inflation, how can there be $700 gold and virtually none?
Must it be $1200 before the talking TV heads acknowledge what every living and breathing American knows: Living in the REAL world costs are far HIGHER than the official US government statistics pretend!

“Gold is still an exceptional buy. Traders will start looking at more traditional relationships like future inflation, government spending and devaluing of currencies.”
Frank McGhee, head dealer, Integrated Brokerage Services

READER: Is Q2 the best period of gold in 2009?
HW: It should be one of the three best quarters in 2009.

READER: If you have the time can you please let me know your "top three picks" from the global Gold miners and producers as under?
1. AAUK
2. AU
3. ABX
4. GG
5. GFI
6. NEM
I do not know if you fancy RANDGOLD [GOLD] of South Africa?
I am planning to buy top three stocks from the above short list this week for investment for self and clients for the year 2011. My target price for Gold for December 2011 is US $ 3000.00 pto).
HW: Personally I prefer midcaps and small caps as they offer a far better Risk/Reward under such a scenario. Additionally I am inclined to wait another week rather than this week and or would recommend stepping in.
That being said I would probably choose AAUK, ABX and GG.
READER: : Very close to my top three picks - NEM, ABX and GG.