Gold Stocks Prognosis: Catalyst, Please

By Jeff Clark, BIG GOLD

It’s probably the #1 question on every gold investor’s mind right now: Why are gold stocks underperforming gold? Aren’t they supposed to bring us leverage to the gold price?

Yes, they are, and their performance been both disappointing and puzzling. There are some exceptions, to be sure, but in the majority of cases the stocks are lagging the metal. And it’s been happening for most of the year. What’s going on?

I think part of the answer lies in the state of our current environment. Recent headlines and developments around the globe have ratcheted up fear… from the S&P’s downgrade to European bank solvency, from fears of another recession to worse-than-expected unemployment. The nervous climate has pushed investors toward gold for safety, simultaneously reducing the demand for gold equities.

You don’t say, “Hey, I need a new iPad!” when you live in hurricane alley and a storm is coming. You make sure you’ve got protection for your family. Likewise, fears of Europe’s debt problems ruining their economy don’t exactly make investors run out and buy Barrick. They buy gold.

Click the link below to see why now is a great time to be buying gold and silver and their respective stocks….

via Gold Stocks Prognosis: Catalyst, Please.

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