The euro reflected that growth in Europe for the first quarter of 2007 exceeded the U.S.'s meager 1.3%, a four year low. April consumer confidence fell to its August low, but the Dow Industrial Average was up about 6% and reached another alltime high, closing at 13,062.

The dollar was not helped by more central banks intending to convert some of their foreign reserves from dollars to other currencies or to gold. One of the stated reasons was the continuing large U.S. trade deficits and the increasing of the U.S. money supply at a rate exceeding 10% per year.

A major reason for the economic slowdown is the slump in housing as inventories increase and sales decrease, and it's predicted to get worse. This limits the Federal Reserve's options on interest rates, because to raise rates to strengthen the dollar might bring about a worse housing problem. Therefore, for another month, the Fed did not change its short term interest rate, still at 5.25%. In the real world the long bond yield at 4.82% would indicate that the market thinks rates should come down, but it may be just an indication of foreign money willing to buy long bonds keeping the price up.

Japan's largest trading partner is now China, not the U.S., which is another sign of China's growth with its neighbors. China's growth is reflected in its purchasing of basic materials worldwide, including oil and basic metals. The price of all energy products keeps rising, from uranium to oil, which closed over 66 with natural gas at 7.71.

fn            Fund                1 mo   3 mo  12 mo   2 yr   3 yr
22 VGPMX Vanguard Prec Metals .   4.7    9.0   11.9  117.2  184.9
19 UNWPX US Global World Pr Mns   4.7    4.6    2.5  139.9  153.6
10 LEXMX ING Precious Metals A.   4.3    8.6   -1.5  108.2  107.0
 1 ASA   ASA Ltd              .   3.3    7.6   -1.9  100.1  104.1
15 INPMX Riversource Prec MtlsA   3.0    3.0    0.8  104.5   94.3
13 OPGSX Oppenheimer Gold A   .   2.9    8.0   10.8  132.2  158.2
12 OCMGX OCM Gold             .   2.2    1.6   -1.9  104.1   99.9
 8 FKRCX Franklin Gold & PrMt A   2.2    6.7    5.1  120.1  135.7
24 GLD   StrtTrks Gold Shrs ETF   2.1    3.5    3.1   54.8        
 9 GOLDX GAMCO Gold AAA       .   1.6    2.9   -2.8  104.0  106.4
 7 SGGDX First Eagle Gold A   .   1.4    4.0   -2.8   74.6   84.0
21 INIVX Van Eck Intl Inv GoldA   1.3    2.2    3.6  117.6  126.6
17 TGLDX Tocqueville Gold     .   1.1    4.9    4.4  108.6  121.6
16 RYPMX Rydex Prec Metals    .   1.1    1.3   -5.9   81.8   71.2
 4 SGDAX DWS Gold & Prec Mtls A   1.0    3.7   -1.6   90.0   80.4
11 MIDSX Midas Fund           .   0.9    6.9    7.4  156.0  172.5
 3 BGEIX Amer Cent Global Gold.   0.7    0.7   -9.1   91.0   94.7
26 HUI   Amex Gold Bugs Index .   0.6    1.1  -10.3   90.8   90.0
 5 EKWBX Evergreen Prec Mtls B.   0.6    2.1    0.4  111.9  120.7
18 USERX US Global Gold Shares.   0.5   -3.1   -7.2  130.5  130.9
 2 FGLDX AIM Gold & Pr Mtls Inv   0.2    1.0   -0.6   95.7  106.9
14 PMPIX Profund Prec Mtls Ultr   0.1   -4.8  -28.0   69.9   69.6
 6 FSAGX Fidelity Select Gold .   0.1    1.0   -2.9  102.7  112.4
27 XAU   Phlx Gold/Silver Index   0.0   -2.0  -13.3   64.1   67.3
20 USAGX USAA Precious Metals .   0.0    2.4    6.6  135.4  137.3
23 GDX   Mkt V Gold Miners ETF.  -0.0   -0.1  		          
25 SLV   iShrs Silver Trust ETF  -0.1   -1.3   -3.5		         

ING Precious Metals (LEXMX) remained in the top three and was joined by Vanguard(VGPMX) and US Global World Precious Metals(UNWPX). SLV was the bottom holder for the second month in a row as silver and silver stocks came down from their recent highs. Although XAU was up and down, most gold equities had small gains and all gold funds posted monthly advances. Compared with last years high at this point in late April, the yearly stats look terrible, but the two year gains are obvious.

The Position indicator gives the relative position of a fund between its 52 week high and low. A high is represented by +100 and its low by -100. Positions and prices as of the end of April:

fn          Fund                  pos   03/30/07  04/30/07
11 MIDSX Midas Fund           .   70.3     4.62     4.66
22 VGPMX Vanguard Prec Metals .   58.2    29.81    31.22
24 GLD   StrtTrks Gold Shrs ETF   55.9    65.74    67.09
 8 FKRCX Franklin Gold & PrMt A   50.8    32.95    33.66
13 OPGSX Oppenheimer Gold A   .   49.3    30.57    31.45
20 USAGX USAA Precious Metals .   47.1    28.67    28.68
23 GDX   Mkt V Gold Miners ETF.   43.9    39.57    39.56
 2 FGLDX AIM Gold & Pr Mtls Inv   41.7     6.15     6.16
17 TGLDX Tocqueville Gold     .   40.0    52.67    53.27
 1 ASA   ASA Ltd              .   38.5    64.69    66.80
21 INIVX Van Eck Intl Inv GoldA   33.9    16.16    16.37
 5 EKWBX Evergreen Prec Mtls B.   33.1    55.01    55.32
25 SLV   iShrs Silver Trust ETF   32.8   133.52   133.35
16 RYPMX Rydex Prec Metals    .   32.1    56.21    56.85
10 LEXMX ING Precious Metals A.   29.1    10.84    11.31
26 HUI   Amex Gold Bugs Index .   21.7   337.66   339.60
19 UNWPX US Global World Pr Mns   19.9    27.21    28.48
15 INPMX Riversource Prec MtlsA   15.9    14.08    14.50
12 OCMGX OCM Gold             .    9.7    17.87    18.26
18 USERX US Global Gold Shares.    7.3    15.34    15.41
 3 BGEIX Amer Cent Global Gold.    5.7    19.12    19.25
 9 GOLDX GAMCO Gold AAA       .    5.7    24.85    25.24
 6 FSAGX Fidelity Select Gold .    4.1    36.38    34.66
 4 SGDAX DWS Gold & Prec Mtls A   -1.2    20.83    21.03
 7 SGGDX First Eagle Gold A   .   -4.2    21.08    21.37
27 XAU   Phlx Gold/Silver Index  -21.1   137.01   137.06
14 PMPIX Profund Prec Mtls Ultr  -66.0    37.12    37.17

With XAU and only three funds below their averages, this stat shows that most funds are holding onto their yearly gains. It is obvious from this comparison that some funds do better than others.

The following list shows the approximate size of funds as measured in total assets under management. (In $millions as of the end of April) This is only an approximation as the size changes daily with new purchases, redemptions, and nav changes. Relative positions of the funds usually don't change much. The largest remain the largest.

fn         Fund                  $assets
22 VGPMX Vanguard Prec Metals .   3478
 6 FSAGX Fidelity Select Gold .   1370
 3 BGEIX Amer Cent Global Gold.   1011
 8 FKRCX Franklin Gold & PrMt A    961
19 UNWPX US Global World Pr Mns    918
17 TGLDX Tocqueville Gold     .    863
 7 SGGDX First Eagle Gold A   .    703
 1 ASA   ASA Ltd              .    671
13 OPGSX Oppenheimer Gold A   .    661
20 USAGX USAA Precious Metals .    652
21 INIVX Van Eck Intl Inv GoldA    417
 9 GOLDX GAMCO Gold AAA       .    386
23 GDX   Mkt V Gold Miners ETF.    340
18 USERX US Global Gold Shares.    228
16 RYPMX Rydex Prec Metals    .    198
 4 SGDAX DWS Gold & Prec Mtls A    172
14 PMPIX Profund Prec Mtls Ultr    155
 2 FGLDX AIM Gold & Pr Mtls Inv    150
11 MIDSX Midas Fund           .    145
10 LEXMX ING Precious Metals A.    130
12 OCMGX OCM Gold             .    106
15 INPMX Riversource Prec MtlsA     85
 5 EKWBX Evergreen Prec Mtls B.     75

Three funds are well over a billion dollars in assets, but GLD has total holding exceeding $10 billion.

The beta indicator measures the relative volatility of a fund's net asset value (nav) movement over the last 52 weeks as compared to the gold fund group average, 1.0. This number indicates volatility by measuring the difference between a fund's high and low navs, but does not specify the direction of movement, so it is only a measurement of relative activity of the price of the fund.

fn       fund                     beta
14 PMPIX Profund Prec Mtls Ultr    1.70
26 HUI   Amex Gold Bugs Index .    1.45
25 SLV   iShrs Silver Trust ETF    1.33
27 XAU   Phlx Gold/Silver Index    1.11
13 OPGSX Oppenheimer Gold A   .    1.08
24 GLD   StrtTrks Gold Shrs ETF    1.07
 4 SGDAX DWS Gold & Prec Mtls A    1.04
11 MIDSX Midas Fund           .    1.03
 3 BGEIX Amer Cent Global Gold.    1.00
 9 GOLDX GAMCO Gold AAA       .    1.00
 1 ASA   ASA Ltd              .    1.00
16 RYPMX Rydex Prec Metals    .    0.98
18 USERX US Global Gold Shares.    0.98
 8 FKRCX Franklin Gold & PrMt A    0.97
10 LEXMX ING Precious Metals A.    0.97
 5 EKWBX Evergreen Prec Mtls B.    0.95
17 TGLDX Tocqueville Gold     .    0.95
 7 SGGDX First Eagle Gold A   .    0.95
15 INPMX Riversource Prec MtlsA    0.95
20 USAGX USAA Precious Metals .    0.94
21 INIVX Van Eck Intl Inv GoldA    0.90
 2 FGLDX AIM Gold & Pr Mtls Inv    0.88
12 OCMGX OCM Gold             .    0.88
 6 FSAGX Fidelity Select Gold .    0.82
19 UNWPX US Global World Pr Mns    0.81
22 VGPMX Vanguard Prec Metals .    0.78
23 GDX   Mkt V Gold Miners ETF.    0.75

The beta for each fund may change as the fund advances and declines, but the general position on the list doesn't change much, except as a reference to other funds. As you can see, there is a big difference between portfolio management policies of different funds.

A quick look at recent graphs of gold equities shows that most are rolling over from a top in April, with XAU leading the way. Even gold ran into resistance near 685 and doesn't appear to have the momentum to punch through to test its yearly high near 725. Silver (SLV) has been sliding for two months. Perhaps we are due for a rest before world events reinforce the ultimate trend, which is up.

While commodity prices have been climbing and gasoline in the U.S. is once again soaring, shares of IYM(basic material) and IGE(natural resources) have topped out and indicate someone may be running out of cash to maintain this bull market. Almost every ETF chart I follow shows a rollover from recent highs in late April.

As the dollar weakened over the past six weeks, the price of gold demonstrated a solid uptrend, attempting to reach 700 before sliding back to regroup. Our problem is that gold funds have not matched gold's enthusiasm. As gold gained, gold equities have been slow to support golds advance.

With most economic indicators weak, why is the Dow booming to new highs? Why are companies reporting such good earnings? This market is posting the best bull market move in forty years. After watching the markets move over short periods of time, everything seems to move together: Dow, gold, gold stocks, energy stocks. Then, at a certain point, they all seem to correct together, like a big sugar daddy is suddenly putting cash or credit on the table for someone to buy, regardless of the fundamental merit of anything, and then taking it off the table. Over a long period of time, fundamentals rule and good stocks go up, but over a short period of time, it seems like there is financial manipulation on a huge scale taking place. Perhaps it is the cash and leverage of hedge funds moving in and out, but that is small scale. The correlation between the Dow Industrials or NASDAQ suddenly making a move and GLD following is only minutes at most. At other times it is vice versa. The back and forth action is starting to resemble a dice game. It favors those in the know and not the average investor.

In the past, when the U.S. GDP growth has been this low, we have a major recession.

Japan continues to maintain a weak yen to help support its markets and the U.S. dollar, and Toyota certainly benefits as General Motors and Ford Motors do not. As almost all currencies continue to get stronger against the yen, Japan will have to answer criticism from other central banks, and cannot continue it forever. When Japan is forced to change policy, such as happened in February, there will be shock waves throughout the world financial markets as investors and bankers adjust. I think the main casualty will be the U.S. dollar.