Mining for Metals Information

By Kristina Zurla Landgraf   ISSUE 505 | MAY 2006

Metals have been moving in May! Gold rose to a new 26-year high above $730 an ounce, silver a 25-year high above $15 an ounce, and platinum a record above $1,300 an ounce. Gold and silver futures trade at the COMEX division of the New York Mercantile Exchange, and you can also trade mini-gold and mini-silver contracts at the Chicago Board of Trade. Sized for smaller investors, these mini-contracts have been setting volume records as the price of the shiny metals continues to soar and correct.

Some facts about gold you might not have known:

• Gold peaked at an all-time high of $850 an ounce in January 1980. At that time, the inflation rate was above 13 percent. Incredibly, in four years, gold had climbed more than 700 percent from its low back in 1976 of just over $100.
• In the past 12 months to date, the price of gold has risen about 70 percent, outperforming major stock market averages such as the S&P 500 and Dow Jones Industrial Average, both up just under 14 percent during the same time frame.
• Pedestrians in Manhattan may not realize they're walking on gold. The New York Federal Reserve's underground gold vault, 80 feet below street level on solid bedrock of Manhattan Island, contains billions of dollars worth of gold. Foreign official gold reserves have been held at the New York Fed since 1924 for numerous reasons, including the stability of the U.S. political system, the concentration of international trade and finance in New York City, and the convenience of centralizing gold holdings in a place where international payments can be made quickly. Read more about the New York Fed's gold vault.
• In March 1933, the exchange of gold for Federal Reserve notes took place to stop the public's Depression-era hoarding of gold bullion. Americans who refused to hand over all their gold currency and coin could be fined up to $10,000 or imprisoned up to 10 years. An exception was made for gold jewelry and rare coins. Read more in "Money, Gold and the Great Depression," a speech by Federal Reserve Governor Ben Bernanke.

More Informational Resources

Given these markets have been making headlines nearly every day, silver and gold have been popular topics during our weekly Lind Plus Markets on the Move webinars. Go to www.lind-waldock.com/events to sign up for these free online events! You'll hear the latest news and analysis on markets making moves each week, and get the chance to ask any questions you have in a live, interactive chat.

Find out what's going on in gold with daily market commentaries on price action and market-moving news from the CBOT, posted on its Web site in a special gold section. The CBOT also provides other information essential to metals traders, including contract specs, data and outside links. Read a brief overview of the history of gold and get current trading session information on the NYMEX Web site, here.

Read about key events in the history of gold prices at the U.S. government's Geological Services Mineral Resources Program site, found here.

Read about the history of money and our nation's bimetallic standard in "Money Matters: The American Experience with Money" by the Chicago Federal Reserve Bank.

If you'd like to get started trading gold or other futures products in a self-directed account with Lind-Waldock or with the assistance of a broker through our Lind Plus division, give us a call at 800-445-2000.

Kristina Zurla Landgraf is editor of Lind eWire. She can be reached by email at editor@lind-waldock.com.

Futures trading involves substantial risk of loss and is not suitable for all investors.

Past performance is not necessarily indicative of future trading results. Trading advice is based on information taken from trade and statistical services and other sources which Lind-Waldock believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder.

© 2006 Lind-Waldock, a division of Man Financial Inc. All Rights Reserved.