Warren Buffet And Gold Mining Stocks
This is true, gold prices are at their historical peak. Many analysts are of the opinion that gold prices can double from the present price of $1,200 per ounce to around $2,500 per ounce in the next six months to one year. Then there are experts who are predicting gold prices to go as high as $8,000 per ounce before 2014.
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Now, stock market is ruled by two kings. One is called the Fear and the other is called the Greed. Both keep on fighting each other. This is what Warren Buffet has said on fear and greed," We simply attempt to be fearful when others are greedy and to be greedy when others are only fearful."
When the investors are greedy, Warren Buffet become fearful or rather what you would say cautious. Remember the Technology Bubble, the Dotcom boom. Warren Buffet had refused to invest in the techology stocks in those days.
The long term trend in the gold market is extremely bullish. Right now, the junior precious metals like gold and silver mining stocks are being viewed with fear and this reminds us of the above statement by Warren Buffet. This statement is the essense of Warren Buffet Investing Style. He buys when others are selling and he sells when others are buying. What you call the perfect contrarian investor.
Don't forget Warren Buffet never took part in the tech bubble. Many people initially criticized him for not investing in tech stocks when the prices were going skyhigh. But soon, when the bubble burst and everyone started crying, Warren Buffet was proven right.
