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Financial Times lets GoldMoney's James Turk explain metals bull market

Section: Daily Dispatches

Bullish on Bullion:
Desire for Safe Havens
Boosts Precious Market

By Monica Porter
Financial Times, London
Saturday, September 9, 2006

James Turk of GoldMoney ( claims we are in the early stages of a multi-year bull market in precious metals.

"It is similar to the 1970s bull market in the metals, and just as that lasted for more than a decade, I expect this one will too," he says. "So we still have several years to go.

"While I am bullish on gold, I am even more bullish on silver. People are fleeing national currencies because of growing problems with inflation. They are looking for safe havens, and that is typically the benefit provided by gold and silver.

"During precious metal bull markets, silver tends to appreciate faster than gold. For example, both gold and silver values have risen every year since 2001, when this current bull market began. But while gold rose 2.2 times, silver has risen 2.4 times. Therefore, the gold/silver ratio has fallen from 72.4 to 56.6 -- which means it now takes only 56.6 ounces of silver to purchase one ounce of gold -- and I expect the ratio to continue moving lower and approach the historical relationship, over hundreds of years, of 16 ounces of silver to 1 ounce of gold, last seen at the end of the last bull market in January 1980.

"So while both gold and silver will rise, I expect silver to rise at a more rapid rate. However, while silver has greater potential, it is more volatile than gold, so it is not for everyone."

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