I forgot to add in my previous note that in addition to asset...

I forgot to add in my previous note that in addition to asset inflation and fiscal cliff impacts on gold, there will also be the welcome inclusion of gold as tier 1 capital under Basel III. I know that a lot has been written in other forums with respect to this (apologies to readers that already have this covered). The real impact for banks is that gold is the main tier 1 capital asset that has the prospect of protecting against inflation (other than common equity if you assume bank shares will appreciate). This is a hugely important factor in the market from 1 Jan 2013.
The catch is that the physical gold management reporting standards are stringent. Gone are the days of getting a different bar number back. Banks will need to account and audit like it's cash. You will see it reported on the balance sheet of Australian banks for the first time since the 70's.

Historically, commercial banks have not invested their own capital in physical gold since Nixon demonetised gold in 1971. This is now a massive new market. If there is any sense of run away inflation in the US (likely as the US government seeks to inflate away debt with QE3 continuing past the fiscal cliff), then US banks may move quickly to secure physical gold.

Blackrock today have signalled that they want to see transparent production costing from producers - a signal that they are looking to put more meat on the bones for valuing "in ground" resources. The math becomes very simple.

So that is why I hold ABU and TAM and my personal favourite OCG because they are all hugely undervalued and leveraged for the potential opportunity in the improving gold market.