This is G&G Investment Society (GGIS) e-newsletter. Why I m Bullish Commodities Again

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Sandra Miller
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1 Karibu (Welcome) GGIS Subscribers, This is G&G Investment Society (GGIS) e-newsletter Why I m Bullish Commodities Again Ok readers I m here in Las Vegas poking my eyes out in this conference trying to stay awake and since I don t gamble I decided to write this report. Before I get started check this out I was listening to this investing cd a couple weeks ago and the author said, investing is much like gambling. But, the difference is that with knowledge in investing you can at least increase your odds of winning. Here in Vegas those saps on the slots don t even realize they have already crapped out. Oh well, let me get on with it Since the beginning of the quantitative easing (QE2) last fall, the benchmark S&P 500 stock index climbed 28% to its recent high. The benchmark Commodity Research Bureau (CRB) commodity index climbed as much as 37% and gold climbed as much as 24%. These moves were in response to the government stimulus. I'm not going to pretend to know exactly what will happen in the next few months. But we can't escape the fact that big economic trends like QE2 cause huge swings in the prices of resource assets... and "Financial D-Day" presents huge risks to those who aren t prepared portfolios. I m seeking safety by sticking to cheap assets in gold and energy. I m remaining "close to the exit door" with some big winners that have we have in the GGIS portfolio, and I m still keeping my pockets open to let natural gas income flow Internal Sponsorship: To become a G&G Investment Society Lifetime Subscriber before the price increases, send an to GGIS@gngassoc.com and/or visit our website at and click on the Products & Services link and we ll get you signed up right away. And, since you are already a GGIS Subscriber, you ll receive a 50% off discount on Tax Preparation services for life if you sign up for a Lifetime subscription. DON'T WAIT ANOTHER DAY! - Lifetime subscription - $699

2 *** Membership Guarantee... If you don't make your money back from being a GGIS member by the end of your subscription...we'll refund 100% of your subscription fee back. That's how confident we are that this will be one of the best financial moves of your life. So, Sign up today!!! Time for a chart lesson here Silver Time to Be Bullish Again Let's start with one of my favorite commodities... Silver was clobbered in May. You can see the carnage in the following chart. Silver gained a colossal 174% from August 2010 to April Then, in May 2011, the price collapsed 31% in just four weeks. This happened for one simple reason. Silver trading grew overcrowded... At one point near silver's peak in April, the silver bullion fund Sprott Physical Silver Trust (NYSE: PSLV) traded at 24% over its net asset value. Think about this for a moment. PSLV does nothing to create value. It buys silver bars and holds them. Shares of the fund simply represent a claim to some percentage of that silver. So in late April, people were paying $1.24 for the privilege of owning $1 worth of PSLV's silver. That's just silly... and smart investors took advantage. Even silver bulls like heavyweight resource investor Eric Sprott, who created PSLV, sold his position in his own silver fund. Now that we're past the correction, silver stocks look attractive.

3 To get a sense of the road ahead for silver, let s take a look at the metal's 120-day moving average (DMA). To find the 120-DMA, you average an asset's closing prices from the last 120 days. Charting the 120-DMA each day produces a line that smoothes out market volatility and helps gauge the general trend. If an asset's current price is above its 120- DMA, we're in a bull market. If the price crosses below, it's entered a bear market. As you can see, silver prices fell all the way down to that 120-DMA trend line, but didn't cross it. If it had, it would have signaled that silver was entering a bear market and the bottom could be a long way off. But the price of silver bounced off that level and started moving back up. The long-term trend for silver remains up. Still, that precipitous fall scared the daylights out of most investors. I doubt we'll see them back in this trade for a while. That's OK with me... I like to be away from the crowd, and I'm still bullish on silver. Here's why... Irrespective of what panicked U.S. investors were doing last month... the Chinese kept buying let me type this again the Chinese kept buying. Throughout the selloff, they bought more gold and silver than ever before. China is on pace to become a net importer of silver in Industrial demand is up 16%, and demand from silver investments is "explosive." The Industrial and Commercial Bank of China (ICBC) sold 14.3 tons of silver in January a little less than half of the 36.3 tons it sold in all of To put that in perspective, China represented 1% of silver's investment demand in If January is the average, its total demand in 2011 will be tons. That's a 372% gain in demand from That would represent 3% of the total world silver investment demand. The 10-year chart below shows last month's correction was just a blip in a long-term bull market for silver...

4 That's why these small peaks and valleys don't throw me. We'll stay long silver and use trailing stops to protect our downside and take profits. That brings me to the performance of the silver miners... Unfortunately, the recent decline in silver prices decimated stocks and that s why it s time to climb back in as recommended in this month s GGIS portfolio. Traders unnerved by falling commodity prices have dumped resource stocks that suggest risk like junior miners. The S&P 500 is down about 5% since early March. The Global X Silver Miners ETF fell 20% over that same period. Silvercorp, the best silver producer in the world, is down 30% for the year. Silver Wheaton, my favorite silver stock, is down 17% for the year, but still up quadruple digits since recommended in GGIS. Ignore the Noise and Focus on the Big Trend Standby for my report on gold as this is another commodity with a clear big trend uppp! As always, if you want to educate yourself on some of the terms I m using in my e-newsletters, check out this site: Also, a good place to learn more about reading and looking up charts is Remember, The more you learn the more you earn, the less you know the more you owe. If you need a one-on-one consultation to learn how to implement these investments or any other on the GGIS portfolio, feel free to contact me to setup an appointment. Until the next time! Ankh Uja Snb (Life, Health & Strength)

5 Asar Gary Gray Tax & Financial Consultant, RFC G&G Associates office toll free fax Become a Fan G&G Associates and G&G Travel on Facebook. "Never love anything that can t love you back. Your investments can t love you back" Warren Buffet P.S. If you are looking to Travel and looking for steep discounted travel, visit click on the G&G Travel link and let your travel planning begin. Let us know where you want to go and we ll do our best to find you the best deal your money can buy. Become a Fan of G&G Travel on facebook. LEGAL NOTICE: This work is based on SEC filings, current events, interviews, corporate press releases and what I've learned as a financial consultant. Nothing herein should be considered personalized investment advice. It may contain errors and you shouldn't make any investment decision based solely on what you read here. It's your money and your responsibility.

This is G&G Associates Tax & Financial Consulting Services e-newsletter. Claiming Two Cars in Your Business

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