John Embry

Gold prices. Reasonable probability of gold reaching $2000 in the spring of 2010 but doesn't like putting hard targets on specific dates because market isn't totally free. Feels it will hit $1300-$1400 by late spring. Important to focus on the trend, which has been up for 9 years. Ignore corrections and use them as an opportunity to add to your goal positions.

Gold/Silver ratio. Very bullish on Silver. Ratio in the neighbourhood of 60 to 1 but historically has been in a range from a low of 15 to 1 to 100 to 1. Expects the ratio to fall significantly when this bull market starts to pick up speed and he expects silver to go up dramatically.

Gold stocks or gold ETF? Not a great fan of gold ETF's. He can’t be convinced they are backed with the amount of gold they say they are. Also, the people that have been sponsoring them are the same ones that have been involved with the gold suppression scheme for 15 years.

Does a gold price lead to more M&A activity? He feels it should, especially in a larger gold company.

Major gold strikes. Expects that most of the major new discoveries will occur in places you would not want to spend a holiday.

Small-cap, mid-cap or large-cap gold? Gold stocks have under performed and are relatively cheap to the gold price. A sharp move up in gold prices will restore the confidence and there will be a massive catch-up mood in the stocks. Biggest moves will come in the mid-cap to the smaller vehicles but you should have a mix and you will do exceptionally well in the next few years.

China. Chinese are past masters at manipulating markets/bullion, etc. No question that they want to add a lot of gold in the forthcoming years in order to hold the largest backing of their currency globally. They will go to great lengths to talk the gold price down.

Will gold ever decouple from the US$ and what would be the signals? Next big decline in the US$ will have gold going up. Can see other countries not wanting their currencies to fall sharply against the US$ for competitive reasons. At that point the market will make the judgment that the currencies are terrible and will want gold for its self.

2 mines in production in Ontario and Quebec and makes very good money. Pays a dividend and has a market cap of about $250 million that is in line with half of the companies that he doesn't think will ever be in production. Has confidence in the new management.

Trying to redevelop the old United Keno Hill mine. Good management. Real good silver speculation.

Has the right formula for succeeding in the silver market because they buy streams of silver production and control their costs. Pay a lot up front but had a guarantee of a certain cost level.

Good merger with Peak Gold and Metallica. Pretty good package of assets. This will be one of the “go to” stocks as we go forward in the cycle. Has been a victim of forced sales, nothing to do with the underlying fundamentals of the company. Tremendous buying opportunity.

Inflation Hedge: Gold bullion, gold fund or gold stocks? The core of anybody's exposure in gold should be gold bullion. If you are going to get into smaller gold companies, you should be in a fund. Larger gold stocks are somewhat efficient so you should have a balanced portfolio.

Gold/Oil Correlation: Historically an ounce of gold was worth about 15-17 barrels of oil. That has changed with the high price of oil and the holding back of gold. Not terribly concerned about demand destruction of oil and the oil price drops. If oil goes back up there will be more printing of money and people will be going to gold as a refuge. Eventually we will head back to the relationship of 15 to 1.

Gold or Silver: Gold has always been acknowledged as real money while silver is called poor man's gold. In the long run, gold is the safer one to be in because of the huge industrial component to silver. However, he feels silver is more under priced than gold and in 2 to 3 years the percentage gain in silver will be better.