'Real Money' Radio Recap: Gold Shines Through Selloff
Stocks may be selling off, but Aaron Task says gold is glittering.
Once again sitting in for the vacationing Jim Cramer on
RealMoney Radio
, Task told listeners that Friday's selloff is due to
Dell's
(DELL) - Get Report
lowered guidance and may not be the end of the world. Still, it's a good opportunity to look at gold prices, which have been heading in the other direction, up more than 5% since last month to $445 an ounce.
"Armageddon is not around the corner," said Task, co-executive editor of
TheStreet.com
. "However, gold is a safe haven against financial distress and should be at least 5% of an investor's portfolio."
Task reminded listeners that people have been flocking toward hard assets such as real estate since the bubble burst, and people need to remember that gold is also a hard asset worth picking up. When everybody is buying gold, said Task, then it's time to leave, but "we are nowhere near that point."
One way to enter the precious metals is to buy gold coins and put them in your safety deposit box. Another method is to buy shares of the
streetTracks Gold
(GLD) - Get Report
exchange-traded fund, which mirrors the changes in the price of gold.
Real gold bugs may also want to buy large-cap mining stocks such as
Newmont Mining
(NEM) - Get Report
and
Placer Dome
( PDG). More speculative gold plays include smaller-cap, "momentum" names like
Glamis Gold
(GLG) - Get Report
,
Meridian Gold
( MDG) and
Coeur D'Alene Mines Corp
(CDE) - Get Report
.
Yet another way to get into the gold game is by purchasing a mutual fund like the
(TGLDX) - Get Report
Tocqueville Gold fund, which Task owns personally.
"If you get a pullback in gold next week, then you should take a look at gold," said Task. "Think about a pinch of gold for your portfolio and don't panic."
Task Wrestles Bradshaw
Task's special guest was John "Bradshaw" Layfield, professional wrestler and stock guru. Layfield professes to be "a buy-and-hold guy who buys on dips, not a heavy daytrader."
And unlike his aggressive wrestling persona, Layfield describes himself as "timid when it comes to buying stocks."
Bradshaw's pick of the week on the
WWE
Web site is
Wal-Mart
(WMT) - Get Report
. Bradshaw says Wal-Mart has been successful fighting the unions and will continue to be. It has also shown a strong ability to expand. "They just do a better job than everybody else. They are a cash cow that will continue to keep growing."
Bradshaw also likes oil shipper
Tsakos Energy Navigation
(TNP) - Get Report
.
"They have 25 double-hulled oil tankers and will add 13 more," said Layfield. "Shipping capacity is dropping, so this company is well-positioned to take advantage of that, plus they have a big dividend to tide you over."
Layfield, a native Texan, also shook off today's selloff in Dell, advising listeners to buy shares on the dip.
"You don't bet against Michael Jordan in basketball and Tiger Woods in golf. And you don't bet against Michael Dell when it comes to computers."
Layfield likes
Bank of America
(BAC) - Get Report
now that it is coast-to-coast and sporting a nice dividend. "It's been dead money for a while, but it's good now."
Task and Layfield like almost all the drilling companies with energy now at a premium; that includes
Superior Energy
(SPN)
.
In response to a caller, Task said he would buy
Motorola
( MOT) on weakness as a long-term holding. Layfield also likes the cash-rich tech sector, especially companies such as
Microsoft
(MSFT) - Get Report
which have no debt.
Aaron L. Task is the co-executive editor of TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. He invites you to send your feedback to
atask@thestreet.com.
