Why Im Worried About Gold
Its not often youll catch me raising a red flag on gold or silver. Im a firm believer in these hard currencies. So I tend not to worry much about them. But Im starting to see a pattern that has me worried about gold.
Basically, Im concerned a bubble is forming in gold stocks
Now before the gold bugs call me crazy, let me just say my concerns have merit. And theres no doubt, weve seen this kind of activity before.
Heres what Im seeing
Im sure you remember the tech stock bubble of the late 90s and early 2000s. For those who dont, heres a quick recap.
The late 90s were a wild time for tech stocks. Just about any company with an e- or a .com in their name was gobbled up by investors much like a kid in a candy store. And up until the spectacular NASDAQ crash, buying tech stocks was almost a guaranteed profit.
Thats what drew in the dark element. Unsavory people found a way to capitalize on the weak. And when thieves and con artists smell blood, they attack
I remember seeing an endless number of faxes and emails coming across my desk. These promos were hyping the next great tech stock you had never heard about. A common refrain was This company has a product that will revolutionize the internet!
And investors afraid of missing the boat jumped into every opportunity.
Sadly, many of these faxes and emails were nothing more than pump and dump schemes set up by major shareholders, through various LLCs. In some cases, the insiders themselves were helping pump up the worthless stocks!
Theyd get you to buy into their stock, and once the share price rose, theyd sell off for a huge profit.
Even worse, sometimes these companies would change their name and business, just to become any type of technology based outfit. Theyd have no management experience in tech and sometimes no real tech products.
And thats the reason Im concerned about gold
Its happening again. But instead of tech stocks being pumped, as they were at the end of the huge NASDAQ run up Im seeing the hyping of mining and gold exploration ventures.
Im constantly exposing company after company for pumping their shares through paid promoters! Of course, its almost always a third party LLC. But whats clear is theyre doing the same thing with these gold mining stocks that they did with tech stocks back in the late 90s
And theyre hoping that everyone thats missed out on the huge run up in gold over the past few years, will jump on new gold and exploration companies now.
Here are just a few of the most hyped gold and metal mining stocks Ive outted for being involved with paid penny stock promoters
- Lone Star Gold (LSTG)
- Viking Minerals (VKML)
- Abot Mining (ABOT)
- North Springs Resources (NSRS)
- Auric Mining (AUMY)
I could go on, and on, but you get the picture.
As I said earlier, I believe in the fundamentals of gold and silver. These metals are a great asset to hold in a world full of weakening fiat currencies.
But now, there are a huge number of gold and mining outfits cropping up all over the place. And Im getting nervous. I mean, really this isnt 1862.
Bottom line
The onslaught of tech pump and dump promotions in the late 1990s was a strong signal that the NASDAQ bubble was about to burst. Today, were starting to see the same patter play out in gold mining stocks. This could be a sign that the gold bubble is getting ready to burst. It could happen in a matter of weeks, or it could take years.
So be sure to keep a close eye on our weekly pump and dump articles. Its one of the only places youll find thats exposing the pump and dump game being played on gold stock investors.
For more information on what to look for in a penny stock pump and dump, read our free report.
Until next time,
Brian Walker
Category: Gold Stocks
