Tags: jim | Cramer | Gold | Bubble | Rally

Cramer: Gold Isn't a Bubble, Rally Just Beginning

By    |   Friday, 29 Oct 2010 08:15 AM

Gold hit a record high of $1,388 earlier this month before slipping back to current levels around $1,340. Star CNBC commentator Jim Cramer says another leg of the rally is coming.

“There is no bubble in gold,” he said on his show Mad Money. “It is a genuine multiyear rally, a super cycle. I think the move here is just beginning.”

Indeed, gold isn’t merely a commodity, Cramer says. “I call it a currency. It works everywhere – a universal currency that we’re running out of. I would do anything I can to get you to build a big gold position in your portfolio — up to 20 percent.”

And how should investors get into gold? Cramer recommends the shares of Agnico-Eagle Mines. “It just reported a beautiful quarter” of earnings, he says.

The company has outperformed the SPDR Gold Shares exchange-traded fund (Ticker: GLD), soaring 28 percent since Cramer turned bullish Feb. 24, compared to a 21 percent increase for the ETF.

“It’s a growth gold stock,” Cramer says.

“The company expects production to rise from 1 million ounces this year to 1.4 million ounces in 2014.” And management seeks a dividend increase.

Not everyone is bullish on gold.

“The expectation of a gradual introduction of quantitative easing is leading to selling in the gold market on the belief that gold had become overbought,” Mark O’Byrne, executive director of GoldCore brokerage in Dublin, tells Bloomberg.

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Gold hit a record high of $1,388 earlier this month before slipping back to current levels around $1,340. Star CNBC commentator Jim Cramer says another leg of the rally is coming. There is no bubble in gold, he said on his show Mad Money. It is a genuine multiyear...
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2010-15-29
Friday, 29 Oct 2010 08:15 AM
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