Ann: Resource Capital Research - Analyst Report 4, page-3

re: Ann: Resource Capital Research - Analyst ... Hi Moorookamick and others.

What a week and then after the close in NY the big surprise of the S.P. down grade of USA debt from triple A.

I guess we could see more red price quotes on stock markets around the world starting unfortunately in our neck of the woods on Monday.

If one believes that in the past the gold price has been held back as part of a plan to ensure that investors are directed into the allegedly safer position of US treasuries and other US debt instruments then this downgrade may prove to be a kick in the orchestra stalls for TPTB.

However, having followed gold and market action including the USA for several years now I find the hairs on my neck standing up at this down grade. Not much of a birthday present for Mr Obama. Somehow I cannot believe that S.P. would break ranks and take such a risk of being punished appropriately. Recall what happened to Bear Stearns when they refused to play ball in that rescue package.

Maybe there is some stomach for cutting back on US internal socialist expenditure and a sacrificial lamb is required. To quote Mark Faber soon we will know if Uncle Ben is a professional or amateur money printer. QE3 waiting in the wings perhaps as early as next week.

We could be in for a few more down days on our small but solid gold producing favourites. I would like to think that at some point in the future investors take note of the record gold price and give consideration to one segment of the market that may just save them from financial oblivion in the coming months.

I have to say that a solid physical gold holding is a major help during times like these of what I like to think of as irrational exuberance in reverse when record gold prices are ignored and producers get smashed, thoughts of bath water and babies comes to mind.

I guess those guys in the red tunics standing in rows of three before the hordes of Zulus must have considered braking ranks at some point in time. (Lots of old movies on UK TV.) However, they held fast and maintained the empire for at least a little longer.

As an aside I am back in the UK after thirty years in Oz. Obtaining a few basics such as a bank account, broad band and telephone service and trying to set up a trading account the red tape is horrendous.

I never did understand how such a small island nation built up one of the greatest Empires in the world but with their current business practices and political light weights I can certainly understand how they lost it.

I feel this coming week will be a major test for KRM and other gold company stock holders, I for one have a little dry fiscal powder so will be looking for a point to load up more shares once I feel the carnage has passed.

Investing in times like these is not for the feint hearted, then again no one ever told us life was going to be easy. I am sure those of still standing in a month or two will be well rewarded as we see gold breach the AUD $2,000.00 mark later this year.

Best of luck to you all in what could well be a trying week.

As always just thoughts and not advice if you do not understand that this is an everyman for himself market particularly these days you are trading in the wrong market. D.D. always a must.

Cheers: Andy