Tom Winmill, portfolio manager of the Midas Fund, reveals potential catalysts for gold and explains why investment demand will stay strong.

Dennis Wheeler, CEO of Coeur d’Alene Mines, says silver prices are rising and demand is steady making his business a success in the recession.

Henry Smyth Director of Granville Cooper Gold Funds says gold will hit $3500 an ounce over the next two years and gives his reasons why.

Speaking of gold, see:
Game Over: How You Can Prosper in a Shattered Economy
Is the Scrap Gold Business Legit?
All That Glitters: 3 Reasons To Invest in Gold Now

Peter Schiff, president of Euro Pacific Capital, says Treasury Secretary Tim Geithner’s new “Financial Stability Plan” is just more of the same bad policy. Here’s what Schiff would do if he was in charge.

By Jeffrey Strain | MainStreet.com

If you have been tempted to turn scrap gold into cash over the Internet, don’t.

The cash for “scrap,” or “junk,” gold industry took a huge step in trying to upgrade its image, with one company moving beyond the typical late-night TV commercials to a coveted Super Bowl advertisement (seen in the image above). Even with the higher profile, selling scrap gold over the Internet is still something you should avoid.

The concept is straightforward. Chances are you have mismatched, damaged or otherwise unneeded gold jewelry you have kept around even though you’ll never use it. With gold prices hovering around $900 an ounce, even that scrap gold is worth some money and a number of Internet businesses have cropped up to buy it.

Here’s how it works: You send scrap gold to the company, and you receive a check with a money-back guarantee that says if you are not satisfied with the price, you get your gold back. At first glance, it appears to be a fair deal, but there are a few issues you need to be aware of.

How they price the gold is unknown: Gold is weighed in pennyweight, with one pennyweight equaling about 1.555 grams. You are unlikely to find the pennyweight price that the scrap-gold company offers for 10-karat and 24-karat gold on its Web site. This makes it impossible for you to estimate your gold’s value and, basically, the company can make up any number it wants when making the offer.

Quick-cash ripoff: You may not be concerned that the company doesn’t list the price because it offers a money-back guarantee. While this is true when the company cuts a check for the scrap gold, the guarantee is usually waived if you opt for getting the payment quickly though direct deposit, the method it promotes heavily.

Insurance for your package is not enough: To get your money, you need to send the scrap gold to the company. The company will provide you with a convenient mailing envelope, which is insured. The fine print most likely will say it is only insured for a small sum (about $100). With gold at about $900 an ounce, even a small amount of scrap gold will surpass this limit. Worse, anyone looking to steal something knows exactly what’s inside the envelope, and that it has a monetary value, making it a likely target.

Your gold’s worth is purposely undervalued: Most of these outfits greatly undervalue the gold that has been sent to them. They know there is a certain percentage of people who will opt for the quick-cash option. Undervaluing the gold in the first place means more profit for the company.

Even if you do raise a dispute, the company probably won’t lose your business. You will find that it will quickly offer a lot more for the same pieces, sometimes double or triple the price, that was originally offered. Even at triple the offer, the company is still making money, so you can imagine how much it makes off those who don’t complain.

Limited time to dispute: If you want to claim the money-back guarantee, you need to do so within a certain number of days, usually about 10. If there is a delay in your mail, or if you’re not around for a few days when the check arrives, you may find you can’t bring a dispute.

They only consider the price of the scrap gold: These companies base pricing purely on what scrap gold is worth. If you have a ring that has a valuable diamond, an antique gold pendant, an old gold collectible coin or a gold watch, they will not put any value above the gold content. If you have any doubt that something might be worth more than the gold content, you don’t want to send it to any of these companies.

In the end, if you have scrap gold that you no longer need, your best option is to go to some local pawn shops and get a few estimates. You will probably get a fair price, and you will also be able to ask questions and learn about scrap gold’s true worth. This also helps to ensure that if any of the items has value beyond the gold itself, you will get paid for that as well.

If taking scrap gold to a pawn shop is too much trouble and you decide to go with an Internet cash-for-gold outfit, be sure you retain the option to dispute the price offer and, if need be, stay within the allotted time period. These two simple steps may triple the amount you receive for the gold.

Welcome to a 234-page financial nightmare: “Game Over: How You Can Prosper in a Shattered Economy”.

Win a copy of “Game Over” — see below!

The book will send shivers down your back. It covers — among other topics — a weakening dollar, the soaring price of oil, increasing competition from China and India, and our runaway national debt.

You’ll wonder when the book will ever get to the part about “prospering”, or any financial recommendations at all, for that matter. Keep reading…. if you dare.

Let’s start with the need for alternative energy. Do any of the available technologies consider the relative scarcity of water and other commodities necessary to manufactuer these replacement fuels? How will we live, even survive, in a world where all of our natural resources are dwindling?

There are several steep challenges in the years ahead that will affect the price of everything. Here are just two discussed in the book:

1. Peak Commodities. Similar to the idea of “Peak Oil”, “Peak Commodities” will occur when there are fewer natural resources left than demand for these resources. This was once a fringe idea. Now, however, Leeb draws out a landscape where — even if the commodities are still in the earth — we are unable to get to or process them before Doomsday climate change.

Here’s just one example: wind energy. Sounds great, right? It is — but let’s not forget the steel necessary to build the wind farms. Do we have enough? What about the water necessary to create steel? Our assumption has been that we’ll have the other necessary natural resources. Not so fast…

2. Growing Complexity. Scientific research continues to grow more specialized. So do our laws. So do our procedures concerning just about anything. How will this web of complexity prevent us from clearly seeing solutions to our most urgent needs?

3. Growing Inflation. Leeb sets the stage for what he considers the growing “inflation tsunami”. Forget the 1970s, he says. We could see staggering inflation as high as 30-40% as the price of goods and fuel increase. That spells major trouble for your long-term investments.

Leeb does make several financial recommendations in the last 1/4 of the book. Here’s a quick overview:

1. Gold. Leeb argues that gold and other precious metals could be the best hedge against major inflation as the world’s resources dwindle. He discusses various ways you can directly or indirectly invest in gold.

2. Investing Abroad. A secondary recommendation is to invest in either rapidly developing nations or nations who are resource-rich. He suggestions two acroyomns: BRIC and BRAC. “BRIC” stands for nations who are rapidly developing: Brazil, Russia, India and China. “BRAC” is shorthand for nations blessed with surplus natural resources: Brazil, Russia, Australia, and Canada.

3. Investing in Support Players of the Coming Resource War(s). Forget investing in oil. Everyone knows oil is declining. Instead, invest in the companies who will be hired by the oil companies as they frantically search for the last drops. Think: oil rigs, 3-D imaging technology, or other defense companies.

Scary? Yes. The book lays out a cup-half-empty view of the coming decade, possibly longer. You’ll enjoy reading it and determining what parts of Dr. Leeb’s projections will come true. Even if half of them never materialize, the book is a great reminder about how critical our energy and environmental policies will be in the coming years.

Win a copy of this book! We have five copies to give away. Be one of the first five people to complete the sentence, “I will know the economy has reached bottom when…” Click here!