Conversation
with Gold
(part 3)
Olaf Sztaba
Olafinvest
Research
Posted August
22, 2003
Just the
other day we were lucky enough to talk to gold itself. Here is the third
and final part of our conversation:
Gold:
Look
at Eldorado Gold, Golden Star, Nevsun Resources and Wheaton River
is doing an excellent job.
Olafinvest
Research (OR): Do
you think investors should get into these stocks now?
Gold: Since the beginning
of my bull market people keep asking the same questions. You
guys recommended most of those stocks when they were trading
at significantly lower prices than they are trading now. Did
people listen? I don't think so. The investment world still does
not recognize this bull market. People will only start listening
when gold shows up on the first page of the major newspapers
and magazines.
Coming back
to your question those stocks are all great buys.
OR: Don't you think that
the gold stocks need to blow off steam before they resume moving
up?
Gold: In the short term you
are right. The leaders of the gold sector need to take time off.
Traders may want to wait for the coming correction and get in
sometime at the beginning of next year.
Keep in mind,
however, that the nature of a bull market is to bring upside
surprises. Those who wait for lower prices are most likely to
be disappointed. The longer-term investors should get in now.
Period.
OR: Could you please share
with us at least a part of your plan for this bull market? How
are you going to play out the next few months?
Gold: Look at the major gold
stocks' indices. The latest ride was truly amazing and I think
it is a good omen for me. Secondly, please keep in mind that
the general stock market is enjoying a cyclical bull market,
which may last until the beginning of next year. The main gold
indices may (and should) take a break now, but when the stock
market sinks back into its malaise, the sky is no limit for us.
OR: How long will it take
you to develop into a full-fledged bull market?
Gold: I am already in a powerful
bull market. It is still unnoticed because it's in its early
stages but if you mean when I show up on TV, it may take another
two or three years and maybe a price of $500 - $700 in order
to be recognized by the general public.
OR: How long do you plan
to be in this bull market?
Gold: Let's get it straight.
I am in a secular (multi-year) bull market which will last years.
On the road I will experience cyclical bear markets (corrections,
like contra-trend declines) but the general direction is going
to be up.
In 2000 we
reached the top of the 40-year cycle in equities. As a result,
the main secular theme of the stock market is bearish even though
we are experiencing a cyclical bull market now. The only difference
is that in each four-year cycle, the bottom will most likely
be located lower than the previous one (compare this to the pre-2000
period when each of the four-year cycle lows occurred higher
than the previous one).
In my case
just the opposite will take place. Each cyclical bottom is going
to be higher than the previous one. I may easily be in a secular
bull market for the next 10 years most likely longer.
OR: You are an optimist!
Gold: I am not. This is a
fact of life. You guys don't have a clue about how far I can
go. The bulls of the bulls will be shocked. I am not going to
share it with you because, as usual in this business, I will
be accused of craziness.
OR: It is time to wrap
up the last part of our discussion. Is there a final thought
you would like to share with us?
Gold: Be patient. Stay loyal
to me. Ignore the noise you hear every day in the media. Stick
to your principles. You guys are in the right place at the right
time. Don't get out too early. The biggest show in the history
of the financial markets has only just begun. Enjoy!
Olaf Sztaba,
August 22, 2003
E-mail: olaf@olafinvest.com
Website: www.olafinvest.com
About Olaf Sztaba
Important
note:
We would like to give credit to Ron Meisels, President of P&C
Holdings, who first came out with this kind of presentation.
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321gold Inc Miami USA
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