A year ago I predicted gold would reach $1,500 an ounce in2010. At the time, gold was hovering around the $1,080 mark,so I expected about a $400 per ounce gain during the year.

Gold came tantalizingly close to my forecast, setting newprice records throughout the year and topping out at an intradayall-time high of $1,431.30 in early December before settlingto a year-end close of $1,421.60. Even though gold didn’t ringthe $1,500 bell, it sure made it hum.

Peering deep into 2011, I see further increases for goldthis year, though at a slightly more deliberate pace and notwithout pitfalls along the way. I expect gold to reach at least$1,600 an ounce in 2011. That’s about a $180 gain per ouncefor the year.

However, numerous indicators strongly hint that goldprices could soar well beyond $1,600, depending on how anumber of variables fall into place.

Without question there will be ups and downs. It’s never astraight line. Along with the exciting bull rallies will comegut-turning corrections at times.The year has begun with sharppullbacks in gold (silver, too). This should be no surprise norshould it be cause for alarm. And it almost certainly won’t be theonly time this year when heart-in-the-throat dives in the goldmarket take place. Gold investors need to keep the long view inmind to keep from getting whipsawed into selling low and buyinghigh. Hang onto your core holdings and ride the waves.

In the last half of 2010, gold raced through a relentlesssurge to successive record highs in the last quarter, gaining30% for the year. A healthy pullback was inevitable and shouldbe welcomed. There was too much speculative froth in the goldmarket, and if it had continued, the gold market would eventuallyhave collapsed under the weight of its own enthusiasm.

A good solid correction will clean out the weak money andleave a strong base for the next leg up. The correction couldlast through the first quarter of this year, then we shouldsee a more orderly, sensible climb to new highs as the yearprogresses. The odds – and technical indicators – favor thelong term trend that has been in place for ten years and showsno signs of weakening in the intermediate to long term. Thepullbacks should be temporary and short (great opportunitiesto grow your gold portfolio).

Of course, the gold-bashers and perma-bears will trumpetthe correction as the end of the gold bull market. You’ll seeheadlines like these at times in the Wall Street Journal [WSJ]proclaiming “Gold Continues to Lose Luster” or “From China,Signs That Gold's Rally Isn't Endless.” The gloomy tone of theseominous-sounding commentaries could make the uninformedinvestor nervous about holding onto gold. But, you’ll also seemore balanced headlines there like “The Power of Gold: TheRisk and Rewards.” This WSJ Smart Money article quotes meand is very balanced.

And you’ll likely see comments from fair-weather goldbuyers like Dennis Gartman, a hedge-fund manager and authorof the Gartman Letter. Gartman says he has sold two-thirds ofhis gold holdings over the past few weeks because it wasn’tmaking new highs and he thought the gold market was toocrowded. “Everywhere you went, everyone you knew wasaggressive long,” he said. “That's a bad sign, because thatmeans everybody has already bought.”

No, not everybody. Only the market insiders and traderslike Gartman. The institutional and public retail investor has, forthe most part, not discovered gold yet.

Visit our free weekly Metals Market Report online: universalcoin.com

By Mike Fuljenz

BULL MARKET

2011

Exclusive

ANNUAL

REPORT

12 BULLISH REASONS WHY GOLD COULD REACH $1,600 IN 2011

BULL MARKET

1-800-459-2646 � universalcoin.comThank You for making us your rare coin team.

IMPORTANT NEW CUSTOMER DISCLOSURES AND AGREEMENT TO ARBITRATE (1) All statements, opinions, pricing, and ideas herein are believed to be reliable, truthful and accurate to the best of UCB’s knowledgeat this time. They are not guaranteed in any way by anybody and are subject to change over time. UCB disclaims and is not liable for any claims or losses which may be incurred by third parties while relying on information published herein. Individualsshould not look at this publication as giving finance or investment advice or information for their individual suitability. (2) All readers of Investors Profit Advisory are advised to independently verify all representations made herein or by itsrepresentatives for your individual suitability before making your investment or collecting decisions. (3) Coin collecting and investing are only meant for those who are personally and financially suited. UCB does not recommend financing anypurchase or spending more than you can afford to lose if your investment goes down in value. Numismatic purchases are affected, in part, by economic and market conditions. While UCB’s competitive pricing, margins and market strategy approachthe market with specific attention to the areas we recommend, we impress upon the customer to perform his or her own due diligence in deciding on the amount and type of their numismatic position and independently verify all representations. (4)As with all investments, the value of the coins could go up or down. UCB and its representatives do not offer any implied or assumed promises. (5) UCB considers coin collecting and investment to be a mid to long term investment. As withall investments, past performance is not a guarantee of future returns. Further, you understand the coin market is speculative and unregulated and you could lose money if you have to sell these coins in the short run, say a year or two. UCBrecommends a hold time of five to ten years or more. While offering no guarantee of growth in any time frame, UCB wants the customer to understand that holding numismatic coins shorter than the recommended hold time could result in losses,while longer holding periods, such as 5-10 years or more increase the chances a coin’s value can rise. (6) Our 100% Satisfaction Guarantee is: If you are not 100% satisfied with your purchase, you may return it in its original packaging withinten (10) days of receipt for a full refund except on special orders or bullion orders. (7) Other returns of numismatic items may be subject to restocking fee of up to 20%. (8) Our policy is that payments for refunds on coins received and confirmedfor liquidation will be processed in 10-15 business days unless specified otherwise by management in writing. (9) Although many areas of numismatics lend themselves to third party grading and authentication, third party certification does noteliminate all risks associated with the grading of coins. (10) Arbitration: UCB strives to handle customer complaint issues directly with customer in an expeditious manner. In the event an amicable resolution cannot be reached, youagree to accept binding arbitration. Any dispute, controversy, claim or disagreement arising out of or relating to transactions between you and UCB shall be resolved by binding arbitration pursuant to the FederalArbitrationAct andconducted in Beaumont, Jefferson County, Texas. It is understood that the parties waive any right to a jury trial. Judgment upon the award rendered by theArbitrator may be entered in any court having jurisdiction thereof. (11)In order to stay abreast of changing market conditions, UCB may contact you from time to time regarding items of interest. (12) All phone conversations between you and UCB are recorded. (13) All transactions and communicationbetween UCB, its employees, and you are only conducted through UCB business address and business telephone numbers. (14) You understand and acknowledge UCB employees cannot receive gifts from customers. (15) You understandit is your responsibility to contact the UCB customer Service Hotline and speak with a manager regarding any issues or complaints that you may have. The toll free UCB Customer Service Hotline is 877-899-8380. (16) Someexperts recommend that in typical times, a diversified investor’s portfolio contain a rare coin and precious metals component of 5% minimum to 25% maximum. Customers should not look at our written materials or our recommendations as givingpersonalized legal or investment advice. (17) Coin values are constantly changing and estimated verbal indications of value may vary due to multiple factors. The company cannot be responsible for any indications used for valuation and purchasingof customer coins unless its offer is in writing and confirmed according to the company’s policies and procedures. (18)You understand and acknowledge all transactions between you and UCB are processed in Jefferson County, Texas. (19)Reproduction or quotation of this newsletter is prohibited without written permission of UCB. Investors Profit Advisory is published by Universal Coin & Bullion, Ltd. ®, 7410 Phelan Blvd., Beaumont, Texas 77706.

Board Member: ICTA

Est. 1994

rev. 03/11

Words to the Wise…The gold and precious metals universe is probablythe biggest and most profitable bull market thatmost of us will see in our lifetime.

–Richard Russell, editor of The Dow Letters

Dealers or financial competitors who badmouth the coin market or other dealers typ-ically have many deficiencies themselves.When bad mouthing is present say whatthey say in Missouri “show me” to bothcompetitors for your business. Give bothdealers a chance to provide a response andproof of memberships, awards, accredita-tions and service. In most cases, the “badmouthing” dealers or financial competitorsare seriously deficient in credibility or theiraccusations are seriously mischaracterized,outdated or blatantly false.

– Mike Fuljenz

Stop by Booth #251 in Pittsburgh.

Are Stock IndexesReally Beating Gold

– At Long Last?The S&P has only 60% of the samestocks as it did in 2000.

The S&P 500 changes an averageof 25 to 30 stocks per year.

In 2007, they changed 43stocks (8.6%) on the list.

Gold has been gold for thousandsof years of recorded history.

Gold doesn’t get a “mulligan”like major stock indexes.

Due to index changes over time,long-term comparisons of stockindexes to gold are flawed.

Recently I googled “Texas un-

claimed property” to see if the

State of Texas was holding

any money I was entitled to. I

do this yearly. It turned out

there was some! You should

google your state and then

“unclaimed property” for you

and any of your relatives that

might have left you money in

the past. It is kind of like free

money! Interestingly enough,

on the Texas unclaimed prop-

erty site one of their headers

is “Come and Get It.”

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INVESTOR’S PROFIT ADVISORY | SPRING 2011

GOLD & SILVERGOLD & SILVER

The Official Rare Coin & Bullion Dealer of the

Despite the occasional corrections, the long term bullishtrend line has not been violated and shows every indication ofremaining intact through 2011 and well into 2012. It has actuallybeen turning dramatically higher but hasn’t gone hyperbolic yet.That will be the time to get out of gold because it will indicatethat the mania has started and the end of the long gold bullmarket is near. That’s still a good ways off.

One thing I can predict with virtual certainty is that after thefirst quarter you can expect the return of recurring headlineslater in the year proclaiming “a new record high for gold.” Thatsounds great, and it helps stir up interest among mainstreampublic investors who may not be all that familiar with gold. Justkeep in mind that what they’re talking about is a nominal newrecord high in dollar terms. In inflation-adjusted terms, though,gold won’t reach a real-money record high until it gets to$2,250 in today’s dollars. That’s how much it will have to costto equal the value of gold’s high of $850 in 1980 dollars.

But what about all that talk you hear about a “gold bubble”that’s about to pop? Not going to happen, period. Why?The facts say otherwise. I’ll give you a dozen reasons whythe bull market for gold (and for that matter, silver and mostall commodities) will continue to flourish in 2011…

BULLISH REASON #1:

UNPAYABLE U.S. DEBTThe U.S. national debt has swelled to almost $14 trillion, a

figure that numbs the brain for most of us. The debt is growingat the rate of $1.4 trillion a year – 10% annually. At that pace,the national debt will double before this decade ends.

As it stands now, if we incurred not another penny of debtand just paid off what we owe right now, this minute, at therate of $1,000,000 a day – that’s a million dollars a day – itwould take 38,356 years to pay off the U.S. debt!

When the world can’t trust the U.S. government to payits debts fairly, then what can investors trust in? For 5,000years, people have been trusting gold over governments atdifferent times.

BULLISH REASON #2:

EUROPEAN SOVEREIGN DEBT CRISISThe sovereign debt crisis in Europe refuses to go away. No

sooner had the furor over Greece sort of died down than Irelandtripped over its Blarney Stone. And before that crisis was calmeddown,worries about Portugal and Spain percolated to a simmer.Italy is in none to sturdy a shape, either, though it hasn’t slippedinto crisis mode…yet. France looks shaky, too.

The hard reality is that the European Union has finiteresources and simply can’t keep bailing every weak-sisterspendthrift country that can’t manage its finances. And throwingmoney at the problem doesn’t cure what causes it to begin

with – nanny-state cradle-to-grave social welfare spending.The Europeans have long been smug about their vaunted socialsafety net, but now the real cost of the socialist ideal is comingclear. As Margaret Thatcher once observed, “The trouble withsocialism is that eventually you run outof other people's money.”

“The European crisisis most likely to heat upagain several times morebefore it comes to somekind of conclusion,”says Filip Petersson, acommodity analyst atSwedish bank SEB.

BULLISH REASON #3:

DOLLAR DEVALUATIONIt is doubtful if Washington has either the ability or the

intention of paying back what the U.S. owes our creditors.Democrat or Republican, it doesn’t matter who’s in charge – thedebt is nearly impossible to repay. It is simply more massivethan we have the means to pay or possibly ever will have. ButWashington won’t default on the debt as many other countriescommonly do when they drown in red ink.

No, Uncle Sam will instead shrink the dollar, which willtherefore shrivel the debt. Washington nags China to boost thevalue of the yuan, which is just another way of saying “We needto debase the dollar.” It’s all part of the “race to the bottom”that infects most major fiat currencies these days…a limbogame of how low can you go to get lower than somebody else’scurrency bar.

And because there’s no accountability for monetary policy– like a gold standard – the Capitol men can simply keep printinglots more dollars out of thin air and pay back the debt withcheaper dollars. But the Washington insiders Bernanke andGeithner get away with it because many in Congress, thePresident, and the Supreme Court seem to look the other way.

Your cash is losing value even while you’re reading this. Itwill lose much more.

As cash shrinks in purchasing power, gold gainsmuscle. Goldmost often rises as the dollar falls…and falls…and falls. Gold isthe ultimate store of wealth when paper currencies cave in.

BULLISH REASON #4:

INFLATION/HYPERINFLATIONThe increase in the headline CPI remains tame at 1.1%,

so the Labor Department tells us. And if you believe that,best avoid realtors offering great deals on beachfront propertyin Kansas. The Consumer Price Index is one of the biggestinaccuracies perpetrated by the government, manipulated andmassaged to minimize reported inflation.

If some of the world’smajor currencies

collapse, the moneythat most can trust

will be gold.

2 | universalcoin.com • 1-800-459-2646

SELL YOUR GOLD WITH CAREBE CAREFUL about dealing with east coast deal-ers you’ve never heard of, who may “cold call”you to buy or sell coins. Be especially careful ifthey do not deal in coins graded by PCGS orNGC, which are the two leading certificationservices preferred by the vast majority of na-tional dealers. Many of these east coast dealerssell coins graded by services that sound likePCGS or NGC over the telephone, so make sureyou confirm you are getting PCGS or NGC prod-ucts before you do business with them. Also, itis always a good idea to check out their currentBetter Business Bureau status. Our company isonly located in Beaumont, Texas and we haveno East Coast Representatives. All our calls toyou should come from a 409 area code. Allpackages shipped to us should be addressed toour Beaumont, Texas address..

���DISADVANTAGES To Dealing With HOTEL BUYERSGold and rare coin buyers doing business out of a hotel, often do not really know whatthey are looking at and may pay as little as 20¢ on the dollar compared to major coindealers. They often lack expertise, and likely do not have appropriate numismaticcredentials and/or industry membership affiliations. They also may fail to give you anitemized receipt, and their “appraisal” process may take longer than normal times, witheven common coins taking 45 minutes or more to get a value. Some of these companieshave received numerous customer complaints and may not be Better Business Bureauaccredited. Additionally, they may not comply with your state’s laws requiring licensingof scales. In 2010, I received the NLG Radio Report of the Year Award for my programson this topic, which were broadcast on KLVI 560 in Beaumont. Jerry Jordan, managingeditor of The Examiner, provided expert research and input for those programs.

���DISADVANTAGES To Dealing With MAIL-AWAY GOLD BUYERSRoutinely, their offers may be about 20¢ on the dollar and you may have to negotiate toeven get that or higher. Some customers have reported their gold items were either lostor melted, could not be returned and were refused reimbursement. Like hotel buyers,some of these companies have been the subject of numerous customer complaints,which has resulted in new laws in many states to address some of their businesspractices. Additionally, they may not be Better Business Bureau accredited. So, be careful!

Universal Coin & Bullion | 7

Why Gold and Rare Coin Prices Should Rise in 2011Demand for gold was at a 10 year high in 2010 according to the World Gold Council. There was a 56% increase in tonnage demand forphysical bars and a 17% increase in tonnage demand for gold jewelry. Increased demand for gold typically results in more customersfrom advertising for dealers.At some point enough of those new customers are introduced to rare coins by their dealers andthe coin market has often taken off. Many of those bullion buyers then trade some of their bullion for rare coins, furtherfueling the market. The recession has resulted in premature selling by some coin buyers but that is slowing down, which in my opinion,bodes well for the rare coin market in 2011. Banks that reduced credit lines to dealers in 2008-2010 are now becoming a bit morereceptive. The almost certain repeal of 1099 provisions in the new healthcare bill will further boost the market and discredit those dealers whoused this as a scare tactic to get collectors and investors to prematurelysell or trade. Obviously the past doesn’t guarantee future results.

1970-2011 Rare Coin Index ResultsTracking the last 41 years, a highly respected Mint State Rare Gold Coin Indexidentifies that rare mint state gold coins outperformed a generic gold coinindex, a 3000 Coin Index as a whole, gold bullion and a return of 5% a year.Based on a number of factors, including the results found in the respected3000 Coin Index,we recommend rare mint state gold coins.While individualrare coin performance may vary, in my opinion, the results indicate that better condition grades, rarity and a market makerstrategy are all important factors in rare coin performance over the long-term. Other experts I respect concur. Furthermore,the coin indices we reviewed do not swap coins in and out like major stock indices do.When one studies the performance of collectionsand sets of coins put together over generations by famous collectors like Eliasberg, Pittman and Bareford, the research is further validated.Set building provided diversification and set premiums for some sets during bull market conditions. Articles on these famous collectorsand their strategies are available free from your account representative. Please call for a free copy.

What Is A Market Maker And Why Is It Important To You?A “market maker” is anyone who is competitively buying and selling a specific product while providing ongoing research and support tothe markets and customer base for such product. Because we focus on buying, selling and publishing activities in only four major areas ofrare coins, out of the thousands available, we are able to provide meaningful and sustained support for the coins we recommend. Ourspecialized commitment is key to building long-term market awareness, collector enjoyment and demand among dealers and collectors.This commitment betters the odds your collection will be worth more in the long term when you decide to sell.Remember, our policy isto competitively buy what we sell. For a free copy of our Select Four Coin Recommendations contact your account representative.

Performance Results from 1970–2011:

Rare Mint State Gold Coin Index

3000 Coin Index

Gold Spot Price

Generic Gold Coins

5% a year

up about 110x

up about 67x

up about 38x

up about 30x

up about 7x

“Inflation is like fuelon gold’s fire.”

Why cook the books? Maybe because of all those Costof Living Adjustments (COLAs) for social benefit (like SocialSecurity) and entitlement programs that are tied to the CPI.If inflation goes up, the government has to pay out more incost-of-living raises.

The CPI is also heavily weighted toward real estate, andhome prices continue to plunge, according to the most recentStandard & Poor’s Case-Shiller report showing home pricesdown 28.6% from the July 2006 peak. That artificially de-presses the CPI even as most commodity-based productsare seeing increases.

According to JohnWilliams’ Shadow Government Statistics,actual inflation is running close to 7% annually, more thansix times what the government is reporting or using for costof living adjustments.

The flood of money supply already spewing out of theFed and the likelihood of chronic quantitative easing for theforeseeable future virtually guarantees serious inflation aheadand very possible hyperinflation.

Then there’s inflation imported from China. Not so longago, China exported deflation with its cheap goods that becamea staple on the shelves of many U.S. retailers.Now China’s success has caught up with it in theform of escalating inflation in commodity pricesthat drives up the price of its goods. U.S. retailersWal-Mart, Gap, and J.C. Penney have warned thatthey expect Chinese clothing goods to cost 30%more because of zooming cotton prices.

Cotton isn’t the only commodity settingrecord highs. The real cost of living is embed-ded in the soaring prices for raw materials andenergy necessary to make goods. Through theages, gold has been the traditional favoritehedge against inflation.

BULLISH REASON #5:

BOOMING CHINA-INDIA-ASIAKeep in mind that most of the financial media reports you

read or see onTV deal almost exclusively about what’s happeningin the U.S. But the U.S. is no longer the center of the financialuniverse. If you really want to know what to expect from gold,forget about what’s going on in the U.S...Asia is what countswhere gold is concerned.

Asians are buying gold in record numbers, especiallyas the price softens. If it weren’t for eager gold buyers inChina, India, and the rest of Asia, the gold market mightwell fall on hard times now, but they provide a solid floorof support that largely offsets the risk-chasing Americangamblers who have been switching from the safety of gold

for the stock market crapshoot.China is the world’s biggest gold producer

and still can’t dig up enough of the yellowstuff to satisfy demand. China and Indiajockey neck and neck for the title of biggestimporter and consumer of gold. Other Asiancountries are just as enthusiastic aboutgold as are China and India; just not on thehumongous scale of their giant neighbors.

Soaring commodity prices and rapidlyrising labor costs have driven up Chineseproduction costs dramatically in the lastyear, generating an unwanted problem theyhadn’t had to deal with before – inflation.

Beijing has raised interest rates twice in just a couple ofmonths to try to put the brakes on inflation, but now concedethey will have to raise their target inflation rate to 4% for 2011,up from 3% for 2010. The Chinese CPI for November ran morethan 5% higher than a year earlier.

WheatCornOats

Canola

HeatingOil

Gasoline

NaturalGasBeefPorkCoffeeSugar

Cotton

CopperGoldSilverCPI-U

80%

70%

60%

50%

40%

30%

20%

10%

0%

THE REAL COST OF LIVING

Year-Over-Year Change ( October 2010) Year-Over-Year Change ( August 2010)

Universal Coin & Bullion | 3

with lit matches on all sides just inchesfrom the fuse. Relations between theU.S. and China have been none toocordial of late. The Russians are nonetoo fond of American politicians, either.Conflicts with either China or Russiaprobably would be trade warfarerather than military… and they’re bothin stronger position.Then there are the natural catastrophes that couldhave global consequences.

SILVER: AMPED-UP “POOR MAN’S GOLD”As gold goes, so goes silver more or less…mostly more.

Over time, silver tends to track in the same direction as gold,and for some of the same reasons – supply/demand squeeze,Asian demand, ETFs, commodity bull super-cycle, inflationworries among them.

When gold goes up, silver typically rises, too, and whengold slips, silver stumbles. However, silver movements tendto be more volatile, rising sharply higher than gold in goodtimes and plunging deeper than gold on reversals. It’s like goldwith the volume amped up to rock concert levels, making boththe high notes and low notes more dramatic.

As gold prices have punched regularlyinto record territory,more investors globallyare looking at silver as a cheaper way toplay the precious metals boom with “poorman’s gold.” Price-conscious buyers inIndia, in particular, have increasingly beenadding silver to their precious metals stashalong with gold.

Lately, the gold-to-silver price ratio has generally been runningabout 44:1 – that is 44 ounces of silver equal to one ounce ofgold. In recent trading, though, the ratio has slipped to about43:1, meaning silver has become more expensive in gold termsbecause it takes fewer ounces of silver to match one ounce ofgold. That indicates that silver is climbing in value faster thangold is, even at gold’s record pace over the past year. The ratiowas as high as about 70:1 in June of last year.

The correction and rebounds we’re seeing in gold reflectsin the silver market, too. Silver led all metals last year, doublingin price from February to December. Too much, too fast, toohot. Silver needs a little cooling off time.

If my forecast target of $1,600 for gold is on themoney, silvershould reach at least $36 an ounce using the trend ratio of 44:1.It could go higher if silver’s volatility accelerates. Silver bullion coinsales are strong in 2011 and mints are having to allocate again.

Catastrophe creates fear, andfear sends investors running to

safety. Reflexively, almostinstinctively they flock to gold

as a safe haven in times ofuncertainty and anxiety.

$36

6 | universalcoin.com • 1-800-459-2646

Silver Should Reach at leastSilver Should Reach at least anounce$36

Source: Casey Research

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“Inflation is like fuelon gold’s fire.”

So the Chinese people are buying gold to protect themselvesfrom inflation…and the government is officially encouragingthem to do so! Beijing has been vigorously promoting privateownership of gold and introducing programs to make it easy forcitizens to stock up on the yellow metal.

“Gold's perceived property as an inflation hedge is makingthe metal an attractive investment in the country, particularly asthe other popular inflation hedge, property investment, hasalready achieved stellar price increases in the past two years,”says BNP Paribas precious-metals analyst Anne-Laure Tremblay.

“Everybody in the gold market knew there was a surge ininvestment demand, but they didn’t know it was China,” saidJeff Christian, managing director at CPM Group.

“The big picture is that China is continuing to relax the rulesgoverning the domestic gold market,” said Martin Murenbeeld,chief economist of DundeeWealth. “What we are seeing is thelatent demand that has been there all the time and now can beexercised in the market because now the market is freed.”

China figures prominently in gold demand in another majorway: central bank purchases. China is the world’s biggest holderof U.S. debt. Concerned about the decline of the dollar’s value (andthus the value of their reserve holdings), the Chinese have quietlybeen diversifying into otherfinancial assets, includ-ing gold. They’ve beenvery discreet in their goldpurchases, knowing thatword of huge Chinesebuying would send goldprices into the strato-sphere. They have to do itslowly and silently. Even subtly, though,it takes gold off the market table and reduces supply, whichmaintains a steady support for gold markets.

BULLISH REASON #6:

CENTRAL BANK BUYINGCentral banks, which in recent decades had been selling

off gold reserves to buy dollars, now have reversed course,trading dollars in for gold and becoming net buyers of the oncescorned metal. China, India, Saudi Arabia, Russia have beenthe largest central bank gold buyers this year. They haven’tstopped buying gold because of the latest correction, nor arethey panicking and selling gold from their vaults.

While China has been subtle about its gold acquisitions,the Russians have been blatantly demonstrative about convertingits reserve dollars to gold. Prime Minister Vladimir Putinloathes the U.S. dollar and wants the world to know it in nouncertain terms. The Russian central bank has very publiclybeen buying hundreds of thousands of gold ounces everymonth over the past year.

Economists at the Dubai International Financial CenterAuthority (DIFCA) have urged Gulf States banks to boost theirgold reserves to protect their huge dollar assets from globalcurrency turbulence. The Persian Gulf Cooperation Councilincludes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, andthe United Arab Emirates. “When you have a great deal ofeconomic uncertainty, going into paper assets, whatever theymay be - stocks, bonds, other types of equity - is not attractive,”said Dr. Nasser Saidi, the chief economist of DIFCA. “Thatmakes gold more attractive.”

“What we’re seeing now is emerging-market centralbanks stepping in as new buyers of gold for the first time, whiledeveloped-market central banks have stopped selling,” saidJorge Beristain, Deutsche Bank Securities analyst.. “So we’reseeing central banks going from a net supply position to a netdemand position, and that could be termed as additionalinvestment demand as well, and one of amore long-term nature.”Beristain notes that China, Brazil, and Russia each hold lessthan 10% of their assets in gold, compared to two-thirds bycentral banks in developed markets. As these markets develop,gold demand is predicted to increase further.

“As emerging market countries become wealthier both froma balance of trade and simply continuing to maintain a

relative similar percentage of gold, that could be a driverfor increased gold demand,”Beristain said.“But additionally,we think that these central banks are re-evaluating howmuch gold they want to hold as a percentage of theiroverall assets, which could be a further driver.”

BULLISH REASON #7:

SWELLING GOLD ETFSThe introduction of gold exchange-traded funds (ETFs) in

recent years opened up the yellowmetal to a whole new audienceof investors who either didn’t know how to buy physical gold orweren’t interested. ETFs made it easy for investors to participatein gold with a point-and-click on the computer. The popularityof ETFs has been a driving force pushing up physical gold prices.Shares in ETFs represent fractional ownership in actual goldpurchased by the fund and stored in a vault (though questionshave been raised about whether there’s actually as much goldin the vaults as the shares represent). As more shares arebought,more gold has to be bought and stored to back it up. Asenthusiasm for gold ETFs continues to rise, more gold supply istaken off the market to be put into the fund vaults.

Sure there have been some outflows from the ETFs in theearly part of this year as the correction unfolds. There mayeven be more over the next month or so. Yet the largest goldETF, SPDR Gold Trust (GLD) is still the sixth largest holder ofgold in the world, bigger than all but five central banks and theIMF. The popularity of gold ETFs should continue to explode asgold prices erupt upwards.

If you really want to knowwhat to expect from gold, forget

about what’s going on in the U.S...Asia is what counts where

gold is concerned.

4 | universalcoin.com • 1-800-459-2646 Universal Coin & Bullion | 5

BULLISH REASON #8:

THE END OF PRODUCER HEDGINGDuring the two decades when gold was in the doghouse,

producer hedging was the bane of gold bugs worldwide.Producers would sell their supply forward to lock in prices theyhoped would be better than in the future as gold valuesdropped week by week. Gold bugs claimed hedging artificiallykept a lid on prices by upsetting the supply/demand balance.

With gold prices relentlessly climbing year after year,producer hedging in gold is now essentially a thing of the past.More than a year ago, Newmont Mining unwound its entirehedge book and was followed soon after by Barrick Gold, longknown as the largest of the producer hedgers. Last year,AngloGold Ashanti, the last of the big hedgers, closed out itshedge book, paying a hefty premium to get out from under itsfutures contracts. Now there are no major gold producers withactive hedge books.

The only remaining hedgers are smaller producers whomostly retain the practice as required as a condition of loansfrom bankers who want to have some security locked in fortheir collateral.

BULLISH REASON #9:

EMERGING MAINSTREAM INTERESTPublic investors – that is, the mom-and-pop players –

haven’t as yet discovered gold in large numbers, though a feware beginning to get the word. Institutional buyers have beendabbling in gold but not charging into it full bore, except forsome aggressive hedge funds and a few forward-thinkinginstitutional buyers like the huge Teacher Retirement Systemof Texas. When public buyers and institutions catch on to goldin a big way, get ready for a wild ride.

However, it’s not likely to happen this year. There’s plentyof room and time for mainstream investors to come on board.The smart money is saying gold will see markedly higherprices in 2011. A poll by Wall Street Journal revealed thatnearly 85% of respondents expect gold to top $1,500 in 2011,and a whopping 41% believe gold will soar higher than $2,000during the year! Only about 15% of the voters in the poll thinkgold has topped out.

BULLISH REASON #10:

FLAT PRODUCTIONAt a time when gold demand is soaring, supply isn’t keeping

up. South African production has been in decline, and globalproduction remains essentially flat. Quality of ore minedcontinues to decline.

Investment manager and natural resources guru Rick Rulesays the easy gold has been found. Any new gold fields will beharder to find and more expensive to mine.

Even if and when a promising big new gold discovery comesalong, it would be nearly ten years before it would contribute anynew supply to themarket, and the way demand has been soaring,it would more than offset the new source of supply by then.

But finding a huge new gold field is a mighty big if. Real-istically, the more likely case is that global gold production willstay flat for a while longer and then begin to decline.

Growing demand and no growth in supply points to highergold prices.

BULLISH REASON #11:

COMMODITY SUPER-CYCLEMary Anne and Pamela Aden, co-editors of The Aden

Forecast, pioneered technical analysis applied to preciousmetalsand natural resources. They continue to declare that even asgold sets new record highs, it is historically a bargain withinwhat they call the “commodity super-cycle.”

Looking past the day-to-day seesaw price gyrations, theAdens look at long term cycles for gold, silver, and other metals.According to their interpretation of the charts, the commoditysuper-cycle is still in the early stage of a bull market that hasa number of years left to run.

The same basic story goes for most all other commoditiesas well – oil, copper, coal, cotton, and all that other stuff thatChina, India, and the rest of the emerging nations need tomodernize their economies and infrastructure.

BULLISH REASON #12:

GLOBAL CATASTROPHE AND UNRESTThe potential for a global catastrophe and unrest hangs

always near and can happen at any time. There’s no shortageof catastrophes lying around to trip over. They are by natureunpredictable and maddeningly difficult or even impossible toplan for. Egypt and evenWisconsin unrest are current examples.

There are wars and rumors of wars, naturally. The mostdangerous is the Korean standoff between North and South.The brinksmanship has escalated to the point that an “accident”could touch off a shooting war that could quickly escalate intoa global nuclear holocaust. Tensions between junior nukersPakistan and India could easily erupt into nastiness that spillsglobally. The Middle East is always a huge powder keg

topped outnow

$1,500 $1,750 $2,000 Higher

15.2%651 votes

13.7%586 votes

12.5%536 votes

17.7%758 votes

41%1758 votesHow high can gold go?

Source: Wall Street Journal

So the Chinese people are buying gold to protect themselvesfrom inflation…and the government is officially encouragingthem to do so! Beijing has been vigorously promoting privateownership of gold and introducing programs to make it easy forcitizens to stock up on the yellow metal.

“Gold's perceived property as an inflation hedge is makingthe metal an attractive investment in the country, particularly asthe other popular inflation hedge, property investment, hasalready achieved stellar price increases in the past two years,”says BNP Paribas precious-metals analyst Anne-Laure Tremblay.

“Everybody in the gold market knew there was a surge ininvestment demand, but they didn’t know it was China,” saidJeff Christian, managing director at CPM Group.

“The big picture is that China is continuing to relax the rulesgoverning the domestic gold market,” said Martin Murenbeeld,chief economist of DundeeWealth. “What we are seeing is thelatent demand that has been there all the time and now can beexercised in the market because now the market is freed.”

China figures prominently in gold demand in another majorway: central bank purchases. China is the world’s biggest holderof U.S. debt. Concerned about the decline of the dollar’s value (andthus the value of their reserve holdings), the Chinese have quietlybeen diversifying into otherfinancial assets, includ-ing gold. They’ve beenvery discreet in their goldpurchases, knowing thatword of huge Chinesebuying would send goldprices into the strato-sphere. They have to do itslowly and silently. Even subtly, though,it takes gold off the market table and reduces supply, whichmaintains a steady support for gold markets.

BULLISH REASON #6:

CENTRAL BANK BUYINGCentral banks, which in recent decades had been selling

off gold reserves to buy dollars, now have reversed course,trading dollars in for gold and becoming net buyers of the oncescorned metal. China, India, Saudi Arabia, Russia have beenthe largest central bank gold buyers this year. They haven’tstopped buying gold because of the latest correction, nor arethey panicking and selling gold from their vaults.

While China has been subtle about its gold acquisitions,the Russians have been blatantly demonstrative about convertingits reserve dollars to gold. Prime Minister Vladimir Putinloathes the U.S. dollar and wants the world to know it in nouncertain terms. The Russian central bank has very publiclybeen buying hundreds of thousands of gold ounces everymonth over the past year.

Economists at the Dubai International Financial CenterAuthority (DIFCA) have urged Gulf States banks to boost theirgold reserves to protect their huge dollar assets from globalcurrency turbulence. The Persian Gulf Cooperation Councilincludes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, andthe United Arab Emirates. “When you have a great deal ofeconomic uncertainty, going into paper assets, whatever theymay be - stocks, bonds, other types of equity - is not attractive,”said Dr. Nasser Saidi, the chief economist of DIFCA. “Thatmakes gold more attractive.”

“What we’re seeing now is emerging-market centralbanks stepping in as new buyers of gold for the first time, whiledeveloped-market central banks have stopped selling,” saidJorge Beristain, Deutsche Bank Securities analyst.. “So we’reseeing central banks going from a net supply position to a netdemand position, and that could be termed as additionalinvestment demand as well, and one of amore long-term nature.”Beristain notes that China, Brazil, and Russia each hold lessthan 10% of their assets in gold, compared to two-thirds bycentral banks in developed markets. As these markets develop,gold demand is predicted to increase further.

“As emerging market countries become wealthier both froma balance of trade and simply continuing to maintain a

relative similar percentage of gold, that could be a driverfor increased gold demand,”Beristain said.“But additionally,we think that these central banks are re-evaluating howmuch gold they want to hold as a percentage of theiroverall assets, which could be a further driver.”

BULLISH REASON #7:

SWELLING GOLD ETFSThe introduction of gold exchange-traded funds (ETFs) in

recent years opened up the yellowmetal to a whole new audienceof investors who either didn’t know how to buy physical gold orweren’t interested. ETFs made it easy for investors to participatein gold with a point-and-click on the computer. The popularityof ETFs has been a driving force pushing up physical gold prices.Shares in ETFs represent fractional ownership in actual goldpurchased by the fund and stored in a vault (though questionshave been raised about whether there’s actually as much goldin the vaults as the shares represent). As more shares arebought,more gold has to be bought and stored to back it up. Asenthusiasm for gold ETFs continues to rise, more gold supply istaken off the market to be put into the fund vaults.

Sure there have been some outflows from the ETFs in theearly part of this year as the correction unfolds. There mayeven be more over the next month or so. Yet the largest goldETF, SPDR Gold Trust (GLD) is still the sixth largest holder ofgold in the world, bigger than all but five central banks and theIMF. The popularity of gold ETFs should continue to explode asgold prices erupt upwards.

If you really want to knowwhat to expect from gold, forget

about what’s going on in the U.S...Asia is what counts where

gold is concerned.

4 | universalcoin.com • 1-800-459-2646 Universal Coin & Bullion | 5

BULLISH REASON #8:

THE END OF PRODUCER HEDGINGDuring the two decades when gold was in the doghouse,

producer hedging was the bane of gold bugs worldwide.Producers would sell their supply forward to lock in prices theyhoped would be better than in the future as gold valuesdropped week by week. Gold bugs claimed hedging artificiallykept a lid on prices by upsetting the supply/demand balance.

With gold prices relentlessly climbing year after year,producer hedging in gold is now essentially a thing of the past.More than a year ago, Newmont Mining unwound its entirehedge book and was followed soon after by Barrick Gold, longknown as the largest of the producer hedgers. Last year,AngloGold Ashanti, the last of the big hedgers, closed out itshedge book, paying a hefty premium to get out from under itsfutures contracts. Now there are no major gold producers withactive hedge books.

The only remaining hedgers are smaller producers whomostly retain the practice as required as a condition of loansfrom bankers who want to have some security locked in fortheir collateral.

BULLISH REASON #9:

EMERGING MAINSTREAM INTERESTPublic investors – that is, the mom-and-pop players –

haven’t as yet discovered gold in large numbers, though a feware beginning to get the word. Institutional buyers have beendabbling in gold but not charging into it full bore, except forsome aggressive hedge funds and a few forward-thinkinginstitutional buyers like the huge Teacher Retirement Systemof Texas. When public buyers and institutions catch on to goldin a big way, get ready for a wild ride.

However, it’s not likely to happen this year. There’s plentyof room and time for mainstream investors to come on board.The smart money is saying gold will see markedly higherprices in 2011. A poll by Wall Street Journal revealed thatnearly 85% of respondents expect gold to top $1,500 in 2011,and a whopping 41% believe gold will soar higher than $2,000during the year! Only about 15% of the voters in the poll thinkgold has topped out.

BULLISH REASON #10:

FLAT PRODUCTIONAt a time when gold demand is soaring, supply isn’t keeping

up. South African production has been in decline, and globalproduction remains essentially flat. Quality of ore minedcontinues to decline.

Investment manager and natural resources guru Rick Rulesays the easy gold has been found. Any new gold fields will beharder to find and more expensive to mine.

Even if and when a promising big new gold discovery comesalong, it would be nearly ten years before it would contribute anynew supply to themarket, and the way demand has been soaring,it would more than offset the new source of supply by then.

But finding a huge new gold field is a mighty big if. Real-istically, the more likely case is that global gold production willstay flat for a while longer and then begin to decline.

Growing demand and no growth in supply points to highergold prices.

BULLISH REASON #11:

COMMODITY SUPER-CYCLEMary Anne and Pamela Aden, co-editors of The Aden

Forecast, pioneered technical analysis applied to preciousmetalsand natural resources. They continue to declare that even asgold sets new record highs, it is historically a bargain withinwhat they call the “commodity super-cycle.”

Looking past the day-to-day seesaw price gyrations, theAdens look at long term cycles for gold, silver, and other metals.According to their interpretation of the charts, the commoditysuper-cycle is still in the early stage of a bull market that hasa number of years left to run.

The same basic story goes for most all other commoditiesas well – oil, copper, coal, cotton, and all that other stuff thatChina, India, and the rest of the emerging nations need tomodernize their economies and infrastructure.

BULLISH REASON #12:

GLOBAL CATASTROPHE AND UNRESTThe potential for a global catastrophe and unrest hangs

always near and can happen at any time. There’s no shortageof catastrophes lying around to trip over. They are by natureunpredictable and maddeningly difficult or even impossible toplan for. Egypt and evenWisconsin unrest are current examples.

There are wars and rumors of wars, naturally. The mostdangerous is the Korean standoff between North and South.The brinksmanship has escalated to the point that an “accident”could touch off a shooting war that could quickly escalate intoa global nuclear holocaust. Tensions between junior nukersPakistan and India could easily erupt into nastiness that spillsglobally. The Middle East is always a huge powder keg

topped outnow

$1,500 $1,750 $2,000 Higher

15.2%651 votes

13.7%586 votes

12.5%536 votes

17.7%758 votes

41%1758 votesHow high can gold go?

Source: Wall Street Journal

“Inflation is like fuelon gold’s fire.”

Why cook the books? Maybe because of all those Costof Living Adjustments (COLAs) for social benefit (like SocialSecurity) and entitlement programs that are tied to the CPI.If inflation goes up, the government has to pay out more incost-of-living raises.

The CPI is also heavily weighted toward real estate, andhome prices continue to plunge, according to the most recentStandard & Poor’s Case-Shiller report showing home pricesdown 28.6% from the July 2006 peak. That artificially de-presses the CPI even as most commodity-based productsare seeing increases.

According to JohnWilliams’ Shadow Government Statistics,actual inflation is running close to 7% annually, more thansix times what the government is reporting or using for costof living adjustments.

The flood of money supply already spewing out of theFed and the likelihood of chronic quantitative easing for theforeseeable future virtually guarantees serious inflation aheadand very possible hyperinflation.

Then there’s inflation imported from China. Not so longago, China exported deflation with its cheap goods that becamea staple on the shelves of many U.S. retailers.Now China’s success has caught up with it in theform of escalating inflation in commodity pricesthat drives up the price of its goods. U.S. retailersWal-Mart, Gap, and J.C. Penney have warned thatthey expect Chinese clothing goods to cost 30%more because of zooming cotton prices.

Cotton isn’t the only commodity settingrecord highs. The real cost of living is embed-ded in the soaring prices for raw materials andenergy necessary to make goods. Through theages, gold has been the traditional favoritehedge against inflation.

BULLISH REASON #5:

BOOMING CHINA-INDIA-ASIAKeep in mind that most of the financial media reports you

read or see onTV deal almost exclusively about what’s happeningin the U.S. But the U.S. is no longer the center of the financialuniverse. If you really want to know what to expect from gold,forget about what’s going on in the U.S...Asia is what countswhere gold is concerned.

Asians are buying gold in record numbers, especiallyas the price softens. If it weren’t for eager gold buyers inChina, India, and the rest of Asia, the gold market mightwell fall on hard times now, but they provide a solid floorof support that largely offsets the risk-chasing Americangamblers who have been switching from the safety of gold

for the stock market crapshoot.China is the world’s biggest gold producer

and still can’t dig up enough of the yellowstuff to satisfy demand. China and Indiajockey neck and neck for the title of biggestimporter and consumer of gold. Other Asiancountries are just as enthusiastic aboutgold as are China and India; just not on thehumongous scale of their giant neighbors.

Soaring commodity prices and rapidlyrising labor costs have driven up Chineseproduction costs dramatically in the lastyear, generating an unwanted problem theyhadn’t had to deal with before – inflation.

Beijing has raised interest rates twice in just a couple ofmonths to try to put the brakes on inflation, but now concedethey will have to raise their target inflation rate to 4% for 2011,up from 3% for 2010. The Chinese CPI for November ran morethan 5% higher than a year earlier.

WheatCornOats

Canola

HeatingOil

Gasoline

NaturalGasBeefPorkCoffeeSugar

Cotton

CopperGoldSilverCPI-U

80%

70%

60%

50%

40%

30%

20%

10%

0%

THE REAL COST OF LIVING

Year-Over-Year Change ( October 2010) Year-Over-Year Change ( August 2010)

Universal Coin & Bullion | 3

with lit matches on all sides just inchesfrom the fuse. Relations between theU.S. and China have been none toocordial of late. The Russians are nonetoo fond of American politicians, either.Conflicts with either China or Russiaprobably would be trade warfarerather than military… and they’re bothin stronger position.Then there are the natural catastrophes that couldhave global consequences.

SILVER: AMPED-UP “POOR MAN’S GOLD”As gold goes, so goes silver more or less…mostly more.

Over time, silver tends to track in the same direction as gold,and for some of the same reasons – supply/demand squeeze,Asian demand, ETFs, commodity bull super-cycle, inflationworries among them.

When gold goes up, silver typically rises, too, and whengold slips, silver stumbles. However, silver movements tendto be more volatile, rising sharply higher than gold in goodtimes and plunging deeper than gold on reversals. It’s like goldwith the volume amped up to rock concert levels, making boththe high notes and low notes more dramatic.

As gold prices have punched regularlyinto record territory,more investors globallyare looking at silver as a cheaper way toplay the precious metals boom with “poorman’s gold.” Price-conscious buyers inIndia, in particular, have increasingly beenadding silver to their precious metals stashalong with gold.

Lately, the gold-to-silver price ratio has generally been runningabout 44:1 – that is 44 ounces of silver equal to one ounce ofgold. In recent trading, though, the ratio has slipped to about43:1, meaning silver has become more expensive in gold termsbecause it takes fewer ounces of silver to match one ounce ofgold. That indicates that silver is climbing in value faster thangold is, even at gold’s record pace over the past year. The ratiowas as high as about 70:1 in June of last year.

The correction and rebounds we’re seeing in gold reflectsin the silver market, too. Silver led all metals last year, doublingin price from February to December. Too much, too fast, toohot. Silver needs a little cooling off time.

If my forecast target of $1,600 for gold is on themoney, silvershould reach at least $36 an ounce using the trend ratio of 44:1.It could go higher if silver’s volatility accelerates. Silver bullion coinsales are strong in 2011 and mints are having to allocate again.

Catastrophe creates fear, andfear sends investors running to

safety. Reflexively, almostinstinctively they flock to gold

as a safe haven in times ofuncertainty and anxiety.

$36

6 | universalcoin.com • 1-800-459-2646

Silver Should Reach at leastSilver Should Reach at least anounce$36

Source: Casey Research

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“Inflation is like fuelon gold’s fire.”

Despite the occasional corrections, the long term bullishtrend line has not been violated and shows every indication ofremaining intact through 2011 and well into 2012. It has actuallybeen turning dramatically higher but hasn’t gone hyperbolic yet.That will be the time to get out of gold because it will indicatethat the mania has started and the end of the long gold bullmarket is near. That’s still a good ways off.

One thing I can predict with virtual certainty is that after thefirst quarter you can expect the return of recurring headlineslater in the year proclaiming “a new record high for gold.” Thatsounds great, and it helps stir up interest among mainstreampublic investors who may not be all that familiar with gold. Justkeep in mind that what they’re talking about is a nominal newrecord high in dollar terms. In inflation-adjusted terms, though,gold won’t reach a real-money record high until it gets to$2,250 in today’s dollars. That’s how much it will have to costto equal the value of gold’s high of $850 in 1980 dollars.

But what about all that talk you hear about a “gold bubble”that’s about to pop? Not going to happen, period. Why?The facts say otherwise. I’ll give you a dozen reasons whythe bull market for gold (and for that matter, silver and mostall commodities) will continue to flourish in 2011…

BULLISH REASON #1:

UNPAYABLE U.S. DEBTThe U.S. national debt has swelled to almost $14 trillion, a

figure that numbs the brain for most of us. The debt is growingat the rate of $1.4 trillion a year – 10% annually. At that pace,the national debt will double before this decade ends.

As it stands now, if we incurred not another penny of debtand just paid off what we owe right now, this minute, at therate of $1,000,000 a day – that’s a million dollars a day – itwould take 38,356 years to pay off the U.S. debt!

When the world can’t trust the U.S. government to payits debts fairly, then what can investors trust in? For 5,000years, people have been trusting gold over governments atdifferent times.

BULLISH REASON #2:

EUROPEAN SOVEREIGN DEBT CRISISThe sovereign debt crisis in Europe refuses to go away. No

sooner had the furor over Greece sort of died down than Irelandtripped over its Blarney Stone. And before that crisis was calmeddown,worries about Portugal and Spain percolated to a simmer.Italy is in none to sturdy a shape, either, though it hasn’t slippedinto crisis mode…yet. France looks shaky, too.

The hard reality is that the European Union has finiteresources and simply can’t keep bailing every weak-sisterspendthrift country that can’t manage its finances. And throwingmoney at the problem doesn’t cure what causes it to begin

with – nanny-state cradle-to-grave social welfare spending.The Europeans have long been smug about their vaunted socialsafety net, but now the real cost of the socialist ideal is comingclear. As Margaret Thatcher once observed, “The trouble withsocialism is that eventually you run outof other people's money.”

“The European crisisis most likely to heat upagain several times morebefore it comes to somekind of conclusion,”says Filip Petersson, acommodity analyst atSwedish bank SEB.

BULLISH REASON #3:

DOLLAR DEVALUATIONIt is doubtful if Washington has either the ability or the

intention of paying back what the U.S. owes our creditors.Democrat or Republican, it doesn’t matter who’s in charge – thedebt is nearly impossible to repay. It is simply more massivethan we have the means to pay or possibly ever will have. ButWashington won’t default on the debt as many other countriescommonly do when they drown in red ink.

No, Uncle Sam will instead shrink the dollar, which willtherefore shrivel the debt. Washington nags China to boost thevalue of the yuan, which is just another way of saying “We needto debase the dollar.” It’s all part of the “race to the bottom”that infects most major fiat currencies these days…a limbogame of how low can you go to get lower than somebody else’scurrency bar.

And because there’s no accountability for monetary policy– like a gold standard – the Capitol men can simply keep printinglots more dollars out of thin air and pay back the debt withcheaper dollars. But the Washington insiders Bernanke andGeithner get away with it because many in Congress, thePresident, and the Supreme Court seem to look the other way.

Your cash is losing value even while you’re reading this. Itwill lose much more.

As cash shrinks in purchasing power, gold gainsmuscle. Goldmost often rises as the dollar falls…and falls…and falls. Gold isthe ultimate store of wealth when paper currencies cave in.

BULLISH REASON #4:

INFLATION/HYPERINFLATIONThe increase in the headline CPI remains tame at 1.1%,

so the Labor Department tells us. And if you believe that,best avoid realtors offering great deals on beachfront propertyin Kansas. The Consumer Price Index is one of the biggestinaccuracies perpetrated by the government, manipulated andmassaged to minimize reported inflation.

If some of the world’smajor currencies

collapse, the moneythat most can trust

will be gold.

2 | universalcoin.com • 1-800-459-2646

SELL YOUR GOLD WITH CAREBE CAREFUL about dealing with east coast deal-ers you’ve never heard of, who may “cold call”you to buy or sell coins. Be especially careful ifthey do not deal in coins graded by PCGS orNGC, which are the two leading certificationservices preferred by the vast majority of na-tional dealers. Many of these east coast dealerssell coins graded by services that sound likePCGS or NGC over the telephone, so make sureyou confirm you are getting PCGS or NGC prod-ucts before you do business with them. Also, itis always a good idea to check out their currentBetter Business Bureau status. Our company isonly located in Beaumont, Texas and we haveno East Coast Representatives. All our calls toyou should come from a 409 area code. Allpackages shipped to us should be addressed toour Beaumont, Texas address..

���DISADVANTAGES To Dealing With HOTEL BUYERSGold and rare coin buyers doing business out of a hotel, often do not really know whatthey are looking at and may pay as little as 20¢ on the dollar compared to major coindealers. They often lack expertise, and likely do not have appropriate numismaticcredentials and/or industry membership affiliations. They also may fail to give you anitemized receipt, and their “appraisal” process may take longer than normal times, witheven common coins taking 45 minutes or more to get a value. Some of these companieshave received numerous customer complaints and may not be Better Business Bureauaccredited. Additionally, they may not comply with your state’s laws requiring licensingof scales. In 2010, I received the NLG Radio Report of the Year Award for my programson this topic, which were broadcast on KLVI 560 in Beaumont. Jerry Jordan, managingeditor of The Examiner, provided expert research and input for those programs.

���DISADVANTAGES To Dealing With MAIL-AWAY GOLD BUYERSRoutinely, their offers may be about 20¢ on the dollar and you may have to negotiate toeven get that or higher. Some customers have reported their gold items were either lostor melted, could not be returned and were refused reimbursement. Like hotel buyers,some of these companies have been the subject of numerous customer complaints,which has resulted in new laws in many states to address some of their businesspractices. Additionally, they may not be Better Business Bureau accredited. So, be careful!

Universal Coin & Bullion | 7

Why Gold and Rare Coin Prices Should Rise in 2011Demand for gold was at a 10 year high in 2010 according to the World Gold Council. There was a 56% increase in tonnage demand forphysical bars and a 17% increase in tonnage demand for gold jewelry. Increased demand for gold typically results in more customersfrom advertising for dealers.At some point enough of those new customers are introduced to rare coins by their dealers andthe coin market has often taken off. Many of those bullion buyers then trade some of their bullion for rare coins, furtherfueling the market. The recession has resulted in premature selling by some coin buyers but that is slowing down, which in my opinion,bodes well for the rare coin market in 2011. Banks that reduced credit lines to dealers in 2008-2010 are now becoming a bit morereceptive. The almost certain repeal of 1099 provisions in the new healthcare bill will further boost the market and discredit those dealers whoused this as a scare tactic to get collectors and investors to prematurelysell or trade. Obviously the past doesn’t guarantee future results.

1970-2011 Rare Coin Index ResultsTracking the last 41 years, a highly respected Mint State Rare Gold Coin Indexidentifies that rare mint state gold coins outperformed a generic gold coinindex, a 3000 Coin Index as a whole, gold bullion and a return of 5% a year.Based on a number of factors, including the results found in the respected3000 Coin Index,we recommend rare mint state gold coins.While individualrare coin performance may vary, in my opinion, the results indicate that better condition grades, rarity and a market makerstrategy are all important factors in rare coin performance over the long-term. Other experts I respect concur. Furthermore,the coin indices we reviewed do not swap coins in and out like major stock indices do.When one studies the performance of collectionsand sets of coins put together over generations by famous collectors like Eliasberg, Pittman and Bareford, the research is further validated.Set building provided diversification and set premiums for some sets during bull market conditions. Articles on these famous collectorsand their strategies are available free from your account representative. Please call for a free copy.

What Is A Market Maker And Why Is It Important To You?A “market maker” is anyone who is competitively buying and selling a specific product while providing ongoing research and support tothe markets and customer base for such product. Because we focus on buying, selling and publishing activities in only four major areas ofrare coins, out of the thousands available, we are able to provide meaningful and sustained support for the coins we recommend. Ourspecialized commitment is key to building long-term market awareness, collector enjoyment and demand among dealers and collectors.This commitment betters the odds your collection will be worth more in the long term when you decide to sell.Remember, our policy isto competitively buy what we sell. For a free copy of our Select Four Coin Recommendations contact your account representative.

Performance Results from 1970–2011:

Rare Mint State Gold Coin Index

3000 Coin Index

Gold Spot Price

Generic Gold Coins

5% a year

up about 110x

up about 67x

up about 38x

up about 30x

up about 7x

A year ago I predicted gold would reach $1,500 an ounce in2010. At the time, gold was hovering around the $1,080 mark,so I expected about a $400 per ounce gain during the year.

Gold came tantalizingly close to my forecast, setting newprice records throughout the year and topping out at an intradayall-time high of $1,431.30 in early December before settlingto a year-end close of $1,421.60. Even though gold didn’t ringthe $1,500 bell, it sure made it hum.

Peering deep into 2011, I see further increases for goldthis year, though at a slightly more deliberate pace and notwithout pitfalls along the way. I expect gold to reach at least$1,600 an ounce in 2011. That’s about a $180 gain per ouncefor the year.

However, numerous indicators strongly hint that goldprices could soar well beyond $1,600, depending on how anumber of variables fall into place.

Without question there will be ups and downs. It’s never astraight line. Along with the exciting bull rallies will comegut-turning corrections at times.The year has begun with sharppullbacks in gold (silver, too). This should be no surprise norshould it be cause for alarm. And it almost certainly won’t be theonly time this year when heart-in-the-throat dives in the goldmarket take place. Gold investors need to keep the long view inmind to keep from getting whipsawed into selling low and buyinghigh. Hang onto your core holdings and ride the waves.

In the last half of 2010, gold raced through a relentlesssurge to successive record highs in the last quarter, gaining30% for the year. A healthy pullback was inevitable and shouldbe welcomed. There was too much speculative froth in the goldmarket, and if it had continued, the gold market would eventuallyhave collapsed under the weight of its own enthusiasm.

A good solid correction will clean out the weak money andleave a strong base for the next leg up. The correction couldlast through the first quarter of this year, then we shouldsee a more orderly, sensible climb to new highs as the yearprogresses. The odds – and technical indicators – favor thelong term trend that has been in place for ten years and showsno signs of weakening in the intermediate to long term. Thepullbacks should be temporary and short (great opportunitiesto grow your gold portfolio).

Of course, the gold-bashers and perma-bears will trumpetthe correction as the end of the gold bull market. You’ll seeheadlines like these at times in the Wall Street Journal [WSJ]proclaiming “Gold Continues to Lose Luster” or “From China,Signs That Gold's Rally Isn't Endless.” The gloomy tone of theseominous-sounding commentaries could make the uninformedinvestor nervous about holding onto gold. But, you’ll also seemore balanced headlines there like “The Power of Gold: TheRisk and Rewards.” This WSJ Smart Money article quotes meand is very balanced.

And you’ll likely see comments from fair-weather goldbuyers like Dennis Gartman, a hedge-fund manager and authorof the Gartman Letter. Gartman says he has sold two-thirds ofhis gold holdings over the past few weeks because it wasn’tmaking new highs and he thought the gold market was toocrowded. “Everywhere you went, everyone you knew wasaggressive long,” he said. “That's a bad sign, because thatmeans everybody has already bought.”

No, not everybody. Only the market insiders and traderslike Gartman. The institutional and public retail investor has, forthe most part, not discovered gold yet.

Visit our free weekly Metals Market Report online: universalcoin.com

By Mike Fuljenz

BULL MARKET

2011

Exclusive

ANNUAL

REPORT

12 BULLISH REASONS WHY GOLD COULD REACH $1,600 IN 2011

BULL MARKET

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Board Member: ICTA

Est. 1994

rev. 03/11

Words to the Wise…The gold and precious metals universe is probablythe biggest and most profitable bull market thatmost of us will see in our lifetime.

–Richard Russell, editor of The Dow Letters

Dealers or financial competitors who badmouth the coin market or other dealers typ-ically have many deficiencies themselves.When bad mouthing is present say whatthey say in Missouri “show me” to bothcompetitors for your business. Give bothdealers a chance to provide a response andproof of memberships, awards, accredita-tions and service. In most cases, the “badmouthing” dealers or financial competitorsare seriously deficient in credibility or theiraccusations are seriously mischaracterized,outdated or blatantly false.

– Mike Fuljenz

Stop by Booth #251 in Pittsburgh.

Are Stock IndexesReally Beating Gold

– At Long Last?The S&P has only 60% of the samestocks as it did in 2000.

The S&P 500 changes an averageof 25 to 30 stocks per year.

In 2007, they changed 43stocks (8.6%) on the list.

Gold has been gold for thousandsof years of recorded history.

Gold doesn’t get a “mulligan”like major stock indexes.

Due to index changes over time,long-term comparisons of stockindexes to gold are flawed.

Recently I googled “Texas un-

claimed property” to see if the

State of Texas was holding

any money I was entitled to. I

do this yearly. It turned out

there was some! You should

google your state and then

“unclaimed property” for you

and any of your relatives that

might have left you money in

the past. It is kind of like free

money! Interestingly enough,

on the Texas unclaimed prop-

erty site one of their headers

is “Come and Get It.”

FREE MONEY

134TH NRA ANNUAL MEETINGS & EXHIBITS

• Pick Up Free Award-Winning Goldand Silver Resources

• See Finest Known, Rare Gold Coins’

• Meet Gold Expert, Author, & Eddie EagleGunSafe® Sponsor Mike Fuljenz

• 2nd Annual Freedom FirstFinancial Seminar (stop by for location & time)

• Expert Gold, Silver, and RetirementConsultations

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INVESTOR’S PROFIT ADVISORY | SPRING 2011

GOLD & SILVERGOLD & SILVER

The Official Rare Coin & Bullion Dealer of the