Gold Backed Securities and ISAs

The price is here:

I guess since it equity-based you just approach a normal shares dealer. You could also ask a UK-based gold bullion dealer such as

or

Cheers,

Roland Watson.

I'm always interested in what you have to say. What reasons do you have to be bullish on gold? and is this extended to all other metals?

Is this to counter the deflation you expect for 2005 and what percentage of your total assets do you intend to invest in this metal.

Looking at 5%. On the inflation/deflation thing, I think Greenspan will try to hold the credit bubble together until Bush is reelected, and that Brown will clearly have to borrow more. That would lead to inflation normally, but at least as far as the US is concerned, there's an output gap that will cap it.Basically asset inflation is likely to continue until the credit bubble goes into reverse either because the authorities panic (say over a crashing Dollar or US equities) or because either lenders or borrowers do. If it goes until the borrowers do the I think the uS and UK will be looking at the Japanese scenario. If it's a lender panic (and so far the eastern governments seem happy to snap up US treasuries to keep their currencies capped) then we'll see how far down the Argentinian path a major country like the US can travel. So basically asset inflation now and still deflation later. The longer the asset inflation, the worse the later reckoning. I'm amazed it's gone this far, but I'm certainly now far from alone in saying that it's a credit bubble (Rubin just came on board I understand) and that it poses the possibility of serious problems.

I admit that there's a risk in holding gold if a deflation comes (though it did OK in the US in the 30's) and it's basically a play against manic debt creation.

The credit bubble survived 2003 much to my astonishment. The US mortgage refi market looks tired now though and I suspect that once US citizens have to live from earned cash while still servicing their debts, we'll begin to see credit stress. Unless Greenspan is willing to follow the Japanese to zero, it's going to be hard for folks there to keep paying their car and credit card debt by cash out refis on their mortgages. If the US recovery doesn't hold up, then I think the game will be up pretty much everywhere else (China and India seem in the strongest position outside the US but even China has banking trouble and a credit boom they're trying to get on top of). Still, the only credit bust was South korea, and the authorities deliberately punctured it, so 2003 goes mostly to the bulls. I expect 2004 to prove that it's a bull rally in a bear market though.

-- A still bearish FoFP

The rise in gold (and silver) prices is partly to do with the fall in the dollar's value. Hence gold's price in Euros is pretty flat and is actually down in terms of the Rand. I think the Pound performance is in between. A lot of people also expect supply/demand problems in general to eventually fuel higher prices across all currencies.

I think the inflation/deflation debate is still wide open but I am betting on higher inflation and interest rates in the years ahead.

Roland.

So house prices increases then. With the exception of art and wine of which i don't know, everthing else is falling in price. Cars (except where supply is restricted), electrical goods etc. What else is there i could profit from.

The longer the

I trust you are aware that the price of gold to the Euro decreased by 6% in

2003. The ECB doesn't want to get into the game like the asian markets of selling its own currency and buying the dollar. After our ERM debacle can you see Brown messing with the markets. Although didn't the BoE sell off massive amounts of gold a few years ago to help the yanks.

I've been following the so call gold bull for a while, i can remember it breaching the wonderful $325 line. I never got on board, didn't know how best to invest. Looking back and even now i think the best way to invest would be by spread betting. This is because the price of gold is in dollars and you don't have to worry about currency conversions, even if it is simple to calculate. You can wait for the best time to invest (which is not now apparently) and you can also close and create stop losses.

No, our idiot chancellor announced to the world that he was going to sell half our gold reserves and buy Euros instead. That way he depressed the gold price in advance and so got a lousy deal. His Euro reserves should have gone up, but he probably sold them and bought dollars instead, judging by his sense of timing.