Chris’ note: Regular Dispatch readers know we see big things ahead for gold…
But that doesn’t mean anything if you don’t know how to position yourself. That’s why today, I’m bringing in my good friend E.B. Tucker to share a simple two-step gold playbook.
As you may know, E.B. is a true gold expert. Before working in the newsletter business, he co-managed a precious metals equity investment fund. Today, he serves on the board of a successful gold company.
In short, he has deep connections in the gold business. He sees what’s really going on behind the scenes… before the mainstream media catches on.
This helps him recommend the best names in the industry for his readers. For example, one of his gold plays is up 119% since he recommended it just over a year ago. Another’s up 47% over the past six months.
It’s not too late to get involved… If you want to make the most of the coming boom, pay close attention to what E.B. says below…
Chris Reilly, managing editor, Casey Daily Dispatch: Hi, E.B. Let’s get right into it.
As regular readers know, you believe gold is primed for a big rally. You say it’s bound to take out its all-time high of around $1,900 per ounce next year… And from there, you can see it hitting $2,200 – a 50% gain from today’s price.
Today, I want to take a step back and help readers understand exactly how they can take advantage of the coming move. What’s the playbook?
E.B. Tucker, editor, Strategic Investor: Good question…
Well, if you’ve never touched gold before, then you’re completely crazy to go out and try to look for the next great mining stock. It’s the equivalent of looking for a cutting-edge software company stock if you’ve never turned on a computer and used it.
You want to start with physical gold.
That’s because gold is a tangible asset that you can hold in your hand. It’s real money, a safe-haven asset, and a way to protect your wealth. It’s survived every financial crisis and will continue to do so.
Chris: What’s the best way to buy physical gold?
E.B.: It’s very easy. I recommend common one-ounce gold coins. The first thing you can do is buy a 1-ounce U.S. gold Eagle. That’s a one-ounce gold coin. You can buy a South African Krugerrand that weighs more than an ounce, but has one troy ounce of gold in it. The Krugerrand is an alloy, so it’s more durable. You can buy a one-ounce Canadian Maple Leaf, which is the purest gold coin available. Any of these coins will work.
You’re going to pay just a tiny bit more than the price of gold to buy these coins. You can hold it in your hand, you can put it in a safe deposit box, you can put it in a kitchen drawer. I think it’s unlikely that someone’s going to burglarize your house for one ounce of gold. But that doesn’t mean you should tell people about it.
I recommend looking at the one-ounce coins offered by Gainesville Coins.
[Chris’ note: We asked Gainesville Coins to create this special page as a starting point for Casey Daily Dispatch subscribers who are new to physical gold. We do not receive any compensation from Gainesville Coins for bringing you this offer.]
Chris: Why is starting with physical gold important?
E.B.: The whole purpose of gold is wealth insurance. You probably have flood insurance living in Florida… well, gold is wealth insurance for your savings.
And your savings are in danger right now.
Think about this… If you had saved up a million dollars in 1994, and bought 10-year Treasury bonds, you would have made over $70,000 a year in interest. That was more than double the median household income at the time – or the equivalent of making over $125,000 today.
It would have been reasonable to think back in 1994 that saving up $1 million meant you’d control your own destiny. However, if you lived until today, just 25 years later, you’d be going back to work.
If you kept that $1 million in the Treasury market, only spending the interest each year, you’d only earn $16,000 a year today. To get back to earning $70,000 today, you’d need close to $4 million saved up.
Here’s where gold comes in: During that time the value of a one-ounce gold coin moved from $385 to $1,450 today. In other words, gold has kept pace with the decline in income from your savings.
You see how this works?
Chris: Indeed. Seems like a no-brainer.
E.B.: That’s right. You’re not looking to make a fortune by buying physical gold. You’re looking to preserve your wealth status. That’s why people have owned it for thousands of years.
Think back to stories of people fleeing war-torn areas ages ago… They had gold coins sewn into their clothing. Why would they do that? They didn’t have stock certificates sewn into their clothing. They didn’t have exotic gold ETF products sewn into their clothing. They had coins because the coins were fungible. They could take them out when they arrived in a foreign land and trade them for the local money and use that money to get started.
Chris: That makes sense. Okay, after buying physical gold for wealth insurance, what’s next?
E.B.: Let’s talk about how you can get filthy rich off of a shocking move in the market…
You can do that with mining stocks.
Gold mining stocks provide “leverage” to a rising gold price… meaning when gold moves an inch, the stocks can move a mile.
If gold takes off like I think it will – and runs through its old high to over $1,900 – even the worst mining stocks are going to go flying. And you’re going to feel like a genius if you buy it.
What’s going to happen is you’re going to buy company “XYZ Resources” located in the middle of nowhere.
Its primary business activity is taking your money and drilling holes in the ground. All of a sudden that company’s stock will get some attention. One of those holes in the ground could strike gold. You’ll see a surge in interest as a frenzy takes hold. The stock price could go way up. If it does, you’ll think, “I’m a genius for picking XYZ stock.”
But really what’s happening is that money is flowing into the gold business. That hasn’t happened for a long time. Actually, it hasn’t happened in earnest since 2011.
So you’re talking about an eight-year drought in that market. Now at some point that drought will come to an end, it’ll turn into a flood.
Chris: Are we getting close to that point?
E.B.: I believe so. Now’s a great time to bet on gold miners.
Remember, this is a cyclical business. When the price surges, mobs of people rush into the gold business. When it falls they abandon the effort and look for something else to get behind. Recently that’s been cannabis and bitcoin.
The gold business is not popular right now. It hasn’t been for a while. I’ve been to conferences that have a black curtain closing off a large section of the attendance hall so people don’t notice it’s half-full.
But here’s the thing… You want to own the mining stocks before the flood. And that’s part of being a contrarian, like we are at Casey Research.
If you’re looking to get exposure to miners, you can check out an exchange-traded fund (ETF) like the VanEck Vectors Gold Miners ETF (GDX), which holds a basket of gold stocks. But remember to treat this as a speculation. Don’t bet more money than you can afford to lose.
Chris: Thanks, E.B. Lots of good tips here. We’ll talk soon.
E.B.: Sounds good, Chris.
Chris’ note: If you haven’t yet, I urge you to check out our 2020 Gold Spike Summit: a rare interview with our founder, legendary speculator Doug Casey.
In it, Doug talks about one of the most important changes of the last 45 years to rules governing gold…
This rule change presents a once-in-a-generation money-making opportunity for those willing to act now. In fact, if you follow this secret, it could make you 10 times, 20 times, even 50 times more as the price of gold continues to rise. But fair warning: This situation is unfolding quickly. You don’t want to wait around.