With lustre coming back to gold, investors are being bombarded by pitches from the bull and bear camps.

So, to whom does one listen?

A punch-drunk gold bull with his pockets turned inside-out or a brash gold bear fattened by a 20-year bear market for the precious metal?

The bull sounds like a groggy George Chuvalo after 15 rounds with Ali and it’s no wonder. More than two decades of getting bootstomped by the bear will do that to you.

The gold bull has been out of fashion about as long as those glittering discotheque balls that were all the rage in the 1970s, when gold mania had people melting down gold-plated bowling trophies as the price rocketed from $39 US in 1973 to $850, its all-time high, in 1980.

Since then, the gold bear has been laughing off any bullish comments about gold and dismissing the yellow metal as a barbaric relic.

But, with the spot price of gold surging $21 to $303 US (per ounce) in the week of Feb. 4-8, that anti-gold sentiment seems to be changing even as many of the bulls shrug off the recent spike.

With the spot price breaking the $300 technical barrier for the first time in two years and most gold stocks boasting enormous gains of 25-75 per cent since the beginning of the year, the bear is starting to squirm uncomfortably, perhaps wondering if the train is about to leave the station.

And the bear’s claim that this rally will be shortlived as usual is starting to sound somewhat hollow. On the other hand, the long-ignored bull is starting to raise eyebrows in boldly forecasting the beginning of a raging gold bull market.

The bull seems to have a strong case for a sustained rally, citing numerous factors:

* gold’s role as a hedge against waning confidence in the markets * the recent trend to hedging reductions by major gold producers such as Normandy Mining;

* a rush by the Japanese to buy gold bullion bars as a safe haven against the fragile yen;

* technical indicators in gold charts that show little resistance to the $320-$300 range;

* a belief that the U.S. dollar’s strength is precarious.

The bear counters that the gold price, which would have to increase substantially to support current lofty valuations of gold stocks, will dip back under $300, citing an economic recovery that would lead to a robust stock market.

Canada’s two most outspoken gold bulls have been John Embry, vice-president of RBC Global Investment Management, who has ventured that gold could bust out to the $400-$500 range, and John Ing, president of Maison Placements, who is calling for an average gold price of $325 this year and a high of $375.

Ing believes that hedging – the forward selling of gold at predetermined prices – has become unfashionable, particularly with the Enron-induced selloff of stocks in companies with misleading or confusing balance sheets.

“Hedging has become like smoking,” quips Ing. “It’s socially unacceptable.” Ing has been touting “third-tier” gold plays on the TSE such as Kinross Gold (K), Eldorado Gold (ELD) and High River Gold (HRG-TSE).

All three stocks are leveraged to benefit from rising gold prices and Ing believes they have 10-bagger potential even after hitting 12-month highs recently. As of Feb. 7, Kinross, at $1.75, had gained 46 per cent since Jan. 1; Eldorado, at .73, had gained 143 per cent; and High River, at $1.45, had gained 142 per cent.

“People see gold as something that maintains value in times of uncertainty,” says Canadian market strategist Kate Warne, of Edward Jones & Co. “It’s like the modern version of a mattress.”

Among the bulls not sold on the recent rally is Jim Bartlett, an analyst with Odlum Brown who specializes in energy, mining and utility stocks.

Bartlett’s latest picks are featured in this week’s Pro’s 3 Stars (see page 18) but none are gold plays.

“I’m mystified by what’s going on with gold,” said Bartlett, a day before the gold price broke out with a $9 single-day gain to crack the $300 plateau.

“I’m not sure what people are betting on,” added Bartlett, citing what he views as bloated prices of some gold stocks.

“Maybe they’ve got accounting problems. The price of gold is a nice price, but it’s not a printing press yet!”

* STREET TALK: “The gold market is likely to correct a bit on overbought conditions, but pullbacks should be bought,” says Erik Gebhard, an analyst with Altavest Worldwide Trading. “I wouldn’t want to be short (short-selling gold)! When gold awakens, it can act like a sleeping giant.”

* SILENCE ISN’T GOLDEN: Two Calgary wireless company stocks – CSI Wireless and Cell-Loc – have been headed in opposite directions since Jan. 1. CSI (CSY-TSE) has been causing a racket with a pair of news releases, one of which announced an $850,000 purchase order for one of its products, since the start of the year and its stock has climbed to $1.70, up 38 per cent.

Cell-Loc (CLQ-TSE), which has been silent (no news in two months), has seen its stock plummet 34 per cent to $1.75 since Jan. 1.

* SAGE ADVICE: “An almost hysterical antagonism toward the gold standard is one issue that unites statists of all persuasions. They seem to sense that gold and economic freedom are inseparable.”

– Federal Reserve chairman Alan Greenspan.

HOT ALBERTA STOCK: Synsorb Biotech



SYB-TSE 43 Cents

Up 13 cents (+43.3%) on 2,351,200 shares (for week ending Feb. 8).

After rocketing in a single day from .28 to a peak of .48 on 1,902,000 shares, Synsorb issued a press release Feb. 8 saying it was unaware of any reason for the sudden surge in the share price. However, shareholders were banking that something was cooking with the Calgary-based biotech firm, which has been plotting a new course since announcing in December that it was terminating the development of its only product in trials, Synsorb Cd.



COLD ALBERTA STOCK: Cell-Loc Inc.

CLQ-TSE $1.75

Down 50 cents (-22.2%) on 259,500 shares (for week ending Feb. 8).

If you've been ridin' this wild buckin' bronc of the TSE, you're either having a blast swing trading or your heart's lodged in your throat. A year ago, stock in the Calgary-based wireless-location company was $3.50 out of the gate, then plunged to $1.50, then leaped to $2.80, then crashed to 38 cents post-Sept. 11, then made a late-year rally to $3.25. Now it's getting stomped again as investors snub the techs. Hang on, pardner!