The mining shares across the board have fallen to ridiculously low levels with some even hitting their 2009 lows. For the physical precious metals, while they are off their peaks they stand well above their 2009 price lows. Is it just me or is there a huge disconnect between the prices of the miners and the price of the ores they mine? My guess is that the miners are very undervalued right now. There may be continued weakness through the summer but ultimately in a few years time, the prices of the miners should rocket upwards.
The news for commodities in general is particularly bearish right now. I just read an article on cnn.com where the author was laughing and mocking all the goldbugs for being wrong which is absolutely ridiculous because the author points to a 17% drop from gold's all time high but ignores the fact that gold rose from $250 an oz and is holding steady at the $1500 an ounce range. What I find consistent among all these people who despise gold is they point out that gold isn't money, that gold doesn't bring in any dividends, etc... but I think what they fail to realize is that when one owns gold you're not getting rich. It's just that the people around you are getting more poor. Rich is when you go to another country that has a much stronger currency than yours and you find that the prices don't really bother you.
Of course, I'd have to agree that all things end in a bubble and that in the end you do want a share in a company that pays dividends as oppose to a chunk of gold which pays nothing. The truth is gold is no more money than copper or salt, but then again neither is fiat currency. Money is whatever the majority of traders will accept as payment. If you can't understand this, then don't buy gold.
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