Jan 9, 2012
We're back on with Jeb Handwerger to discuss "The January effect," and how to pick the best mining stocks. According to Jeb, gold and silver miners will rise again in 2012, and the time honor trope regarding the month of January reigns true as the first week of the New Year shows stocks opening on a bullish note. When asked about the best gain for 2012, Jeb says investors must look at undervalued junior mining natural resource assets--he recommends companies with strong financial positions that are progressing toward a stage of mine development.
As you're all aware, the Euro has been breaking into new record low levels. While many are concerned, Jeb states that there is a Golden opportunity for mining stocks emerging in this Eurozone crisis. While many people are concerned going into the dollar with long term treasuries, the major mining companies are looking to transfer their growing cash positions into undervalued European natural resource assets. As the Euro sinks into new lows, European mining capital is flowing in the right direction as miners costs are going down and margins are going up.
As we look into precious metals as the true base for currency, we're going to need the mining companies to produce more. Demand has not subsided; in fact, we're in a bull market regarding gold and silver--the trend has not been violated. Although gold finished higher for the last 11 years, Jeb really likes silver for out preforming gold in 2012. Regardless, it looks like this is going to be an up-year for gold and silver mining stocks. You should stand strong--this is not a time to sell for pennies on the dollar!
Please send your questions to kl@kerrylutz.com or call us at 347-460-LUTZ.