Details

About the Author ix <p>Introduction xi</p> <p><b>Section 1: Advantages and Risks of Precious Metals 1</b></p> <p>The Gold Debate 2</p> <p>Fundamental Forces against Gold 3</p> <p>Valuation Forces against Gold 3</p> <p>Psychological, Technical, and Liquidity Forces against Gold 4</p> <p>Fundamental Forces for Gold 5</p> <p>Valuation Forces for Gold 8</p> <p>Psychological, Technical, and Liquidity Forces for Gold 8</p> <p><b>Section 2: Precious Metals Investment Performance and Correlations 11</b></p> <p>Correlations of Annual Returns of Precious Metals 12</p> <p>Principal Uses of Precious Metals 13</p> <p><b>Section 3: Overview of Gold 15</b></p> <p>History and Background of Gold 15</p> <p>Why Central Banks Hold Gold 16</p> <p>Gold Sales under Central Bank Gold Agreements (CBGA) 17</p> <p>Major Central Banks’ Gold Holdings 18</p> <p>Gold as an Asset Class 19</p> <p>Demand, Supply, and Global Gold Holdings 22</p> <p>Jewelry and Net Retail Investment in Gold 23</p> <p>Above-Ground Stocks of Gold, Demand and Supply Flows 24</p> <p>The Price of Gold 26</p> <p>Gold Demand Outlook 27</p> <p>China and Gold Ore Reserves 28</p> <p>Origins of Gold Demand in China 29</p> <p>Long-Term Outlook for the Chinese Gold Market 30</p> <p>China and Gold 31</p> <p>India and Gold 31</p> <p>Gold Price Relative to the S&P 500 32</p> <p>Gold Prices during Periods of Uncertainty 32</p> <p>Gold Price versus the DJIA and the S&P 500 34</p> <p>Ratio of the Price of Gold to the Price of Silver 34</p> <p>Annual World Production of Gold since 1900 34</p> <p>Global Supply of and Fabrication Demand for Gold 36</p> <p>Investment Performance of Gold Share Indices 37</p> <p>Physical Gold 38</p> <p><b>Section 4: Overview of Silver 41</b></p> <p>History and Background of Silver 41</p> <p>The Price of Silver 42</p> <p>Annual World Production of Silver since 1900 44</p> <p>Global Supply and Demand Data for Silver 44</p> <p>Physical Silver 44</p> <p><b>Section 5: Overview of Platinum and Palladium 47</b></p> <p>History and Background of Platinum and Palladium 47</p> <p>The Price of Platinum and Palladium 48</p> <p>World Production of Platinum and Palladium 51</p> <p>Global Supply and Demand Data 52</p> <p>Physical Platinum and Palladium 54</p> <p><b>Section 6: Overview of Precious Metals Companies 57</b></p> <p>Select Factors Leading to Price Divergence between Precious Metals and Precious Metals Mining Shares 57</p> <p>Select Precious Metals Mining Shares Indexes 57</p> <p>NYSE Arca Gold BUGS Index 57</p> <p>Philadelphia Stock Exchange Index 58</p> <p>Market Vectors Junior Gold Miners Index 59</p> <p>FTSE Gold Mines Index 61</p> <p>S&P/TSX Global Gold Index 62</p> <p>Examples of Precious Metals Companies 63</p> <p>Precious Metals Futures and Options Contracts 64</p> <p><b>Section 7: Select U.S. Legislation Affecting Gold 67</b></p> <p>The Gold Confiscation Executive Order of April 5, 1933 67</p> <p>The Trading with the Enemy Act of October 6, 1917 70</p> <p>Executive Order 6102 of April 5, 1933: Forbidding the Hoarding of Gold Coin, Gold Bullion, and Gold Certificates 71</p> <p>Reports of Safe Deposit Box Seizure 71</p> <p><b>Section 8: Additional Information on Gold 73</b></p> <p>Background Information on Gold 73</p> <p>Characteristics 74</p> <p>Monetary Exchange 74</p> <p>History 75</p> <p>Occurrence 76</p> <p>Production 76</p> <p>Consumption 77</p> <p>Symbolism 77</p> <p>State Emblem and State Mineral 77</p> <p>The California Gold Rush and the Panic of 1857 78</p> <p>When Wall Street Rescued the U.S. Treasury 79</p> <p>Britain’s 1999–2002 Sale of Gold Reserves 80</p> <p>Switzerland and Gold 82</p> <p>Gold Performance Relative to Real Interest Rates 84</p> <p>Gold Investment Flows 84</p> <p>Money Supply and Gold Price vs. Inflation 84</p> <p>Operation of the Gold Market 86</p> <p>Over-the-Counter Market 86</p> <p>London Bullion Market 86</p> <p>Futures Exchanges 86</p> <p>Market Regulation 86</p> <p><b>Section 9: Additional Sources and Disclosures 89</b></p> <p>Select Websites 89</p> <p>Books 89</p> <p>Reports 92</p> <p>Periodicals 93</p> <p>Other 94</p> <p>Disclosures 94</p> <p>Acknowledgments 99</p>

<b>David M. Darst</b> (New York, NY) is a Managing Director of Morgan Stanley and chairs the firm's Global Wealth Management Asset Allocation and Investment Policy Committee. He serves as Chief Investment Strategist of the Global Wealth Management Group, with responsibility for Asset Allocation and Investment Strategy, and was the founding President of the Morgan Stanley Investment Group. Mr. Darst joined Morgan Stanley in 1996, after more than 20 years with Goldman Sachs, where he served as a senior executive in the Equities Division. Previous responsibilities with Goldman included serving as Resident Manager of their private bank in Zurich. Darst is the author of four books: <i>The Complete Bond Book, The Handbook of Bond and Money Markets, The Art of Asset Allocation,</i> and <i>Mastering the Art of Asset Allocation</i>. He has also contributed numerous articles to <i>Barron's</i>, <i>Euromoney</i>, <i>The</i> <i>Money Manager</i>, and other publications. Darst is frequently quoted and regularly profiled in the business press including the <i>New York Times</i>, the <i>Wall Street Journal</i>, Reuters, <i>Financial Times</i>, among others. He is a frequent guest on CNBC, Bloomberg, and FOX News, and on radio shows. Darst earned his MBA from Harvard Business School and received a BA in Economics from Yale University, both of where he has served as a visiting faculty member. Darst also holds a CFA.

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