I said that we were likely to have a final run to the downside primary support level of between 540 and 560 for gold, and then move quickly higher to maybe 640 before closing the year at 700. In other words " given this is now October " the action was about to start.

I pointed out that in my weekend blog entry (WIR) I laid out my stance on gold (and the other precious metals), as follows:

(T)he major broker-dealer research reports appear to be solidly behind a consensus opinion that gold will trade at least ten percent higher next year, and the gold bugs are holding dear to that as well.

I continue to believe, however, that gold in the near-term will have one more test of the floor, which in my view is $540 (maybe $560), before moving into the mid-600's.

Personally, I don't see that as a problem (if it happens) because most of the top-quality gold miners can make good profits at that gold price.

But I also believe that the next Bull phase in the gold market will be on the back of a sliding $USD, and that $GOLD will move back over $700, and probably (as I see it) over $800. I also see that happening sooner than later " say within 12 months.

When I look into the future of these gold miners, I can see a lot of new but small mines coming on-stream, but the winding down of some major producers. The net effect will likely be a declining gold production over the next 5 to 8 years.

The U.S. reserves are still quite sufficient to sell off bullion to hold the price from escalating to the $2000, $4000 and $10000 price levels I have read that some people are forecasting, so I'm content to stick with the $800 range as a best guess on the peak level of the next spike.

Depending on how many years you'd care to plan, I see that gold will continue to do as well as or better than say land banking or average home values after netting out costs.

But the truth is I'm only interested in gold (and silver) right now (ie, at relatively modest CPI levels), as an alternative to a heavier weighting of cash " partly because I believe that the $USD will fall in value (and the Cdn $ not do that well either) and partly because I believe that following a Bear market in equities, there will be plenty of excellent places to put the bulk of that cash to work.

So the message I'm giving here is (i) I'm not a gold bug, (ii) I think gold prices will get a bit worse before taking off, and (iii) I hope the average person hangs in with their gold positions for the time being, and adds to them when $GOLD breaks out into the $615-625 range (which would be a momentum play), or breaks down into the $540 range (which would be a value play).

When one of my associates " Mr. Platinum " asked for my forecast on the Cdn Dollar, I said that I was not high on it for now, but if gold did move to $700, as I believed, that the CAD would likely be trading at 92 cents.

We'll see. Everybody has a viewpoint " that's what markets are driven by.

Today I see that Dec. gold is down -$13.10. I'm starting to wonder how many people are listening. (lol)

BTW, an interesting point was made around the table re uranium. The consensus was that uranium will continue to move higher, but the statement from one of the experts that surprised me was his unequivocal statement that Sprott, let's say, "materially affects" the global uranium price. More on that "Street talk" later. I'm sure Sprott would disagree, so I'll look into it.