I don't like the way the US markets are looking. And I'm increasingly fearful about what we're seeing.

When you consider liquidity problems in the market, derivatives, the adjustable rate mortgage dilemma on the heels of all of this subprime mess...just to name a few...it's clear that we've got some major problems to deal with. And the outlook for gold is stronger than ever.

We have the US dollar hitting a all-time lows against many other currencies. At last look the US Dollar Index was just over 72. And we're getting to that critical 70 benchmark, which, once broken, I believe gold will start having $100 up days instead of $20 up days.

Outlook for Gold and Junior Mining Stocks

Needless to say, I'm very bullish on gold. In fact, I think gold prices may move from $1000 to $2000 an ounce in a matter of six to eight months, depending on how the issues with the dollar pan out from here. So be prepared.

However, junior mining stocks are in a real funk. There's no denying it. And I think that we're going to stay in that funk until we get past the capital gains taxpaying season. After that I think higher precious metal prices are going to start pulling junior mining stocks out of the trough and moving them much higher.

There are three or four big hedge funds in New York that have gone long gold with all the majors, but have shorted all the juniors. But as gold an PM prices keep going higher, the juniors are going to move higher, and these guys are going to have to run to cover their short positions. And that should launch our junior market up to new highs. So, my outlook is to stick with it.