Royal Mint warns against melting pennies as dentists profit from scrap fillings

Section:

Gold Bugs

By Peter McKay
The Wall Street Journal
Thursday, May 11, 2006

Investing pros have begun pondering the possibility that gold will
hit a record over $800 a troy ounce soon. This means that the gold
bugs -- that patchwork of sometimes offbeat investors who love the
shiny stuff -- are happier, and louder, than ever.

Gold futures for May delivery have risen this week 3.2%, or $21.50,
to a 25-year high of $703.70 per troy ounce. In the past two years,
prices have soared 86%.

"We all said what was going to happen and why," says Bill Murphy, an
ex-professional football player and trader who heads up a group that
goes by the name Gold Anti-Trust Action Committee, or GATA.

There are lots of reasons behind the move: For one, the dollar has
weakened, and seems headed lower. When people lose confidence in
paper currency some turn to gold, which is still seen in some parts
of the world as an alternative store of value, despite many years in
disfavor. This reputation as a store of financial value means it is
also seen as a hedge against inflation, which shows signs of picking
up, and against political turmoil, like say, turmoil in Venezuela,
Iran and Iraq.

For some gold bugs, though, it's rarely that simple. Back in 1999,
when gold was at multiyear lows around $250, GATA argued the metal's
price was being artificially suppressed by a cartel of large private
banks selling borrowed gold, much of it on loan from powerful
central banks. The latest stage of the rally, Mr. Murphy says, is
because Russia has become a heavy buyer, helping to squeeze the
alleged cartel.

"They're a little conspiratorial, for me even," says money manager
Peter Schiff, an outspoken gold bug himself. "I don't know if there
was any real orchestrated event."

Whatever the case, the gold bugs aren't alone anymore. The
investment audience for the precious metal is broadening as hedge
funds and others seek alternatives to stocks and bonds. Because the
gold market is relatively small, in terms of physical metal
available and the number of investors who have traditionally
participated, even a small increase in mass appetite for the metal
can result in more price increases.

Pick your reason. Gold seems headed higher still.

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http://www.plata.com.mx/plata/home.htm
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Ted Butler silver commentary archive:

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----------------------------------------------------

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----------------------------------------------------

HOW TO HELP GATA

If you benefit from GATA's dispatches, please
consider making a financial contribution to
GATA. We welcome contributions as follows.

By check:

Gold Anti-Trust Action Committee Inc.
c/o Chris Powell, Secretary/Treasurer
7 Villa Louisa Road
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USA

By credit card (MasterCard, Visa, and
Discover) over the Internet:

http://www.gata.org/creditcard.html

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Holding number 50-08-58-L

Donors of $200 or more will receive copies
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GATA is a civil rights and educational
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Code and contributions to it are tax-deductible
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