TGR: Are there specific indium companies that you're watching right now?

JL: Unlike many other metals in the marketplace, there aren't many companies that are specifically indium-focused. It's usually something that develops when they're looking for gold or silver, or they just happen to come across indium. It kind of resembles zinc. It's a metal that could become a scarce resource over the next decade due to increased usage.

TGR: Where is indium being found? In specific geographic areas or worldwide?

JL: It's not worldwide. There is some indium in Argentina, as I mentioned. China has one of the largest indium resources; Russia has some, too. Those are the biggest sources. The U.S. does not produce any indium whatsoever.

TGR: In the past, you've been bullish on platinum and palladium. Do you still think those are good plays for investors?

JL: I am and, being that I am so bullish on gold, I think that platinum and palladium are platinum group metals (PGMs) that will not only ride the coattails of the gold market strength but also establish themselves as unique metal plays. Recent launches of ETFs on those metals show that investors are gaining more confidence in them as individual metals—rather than metals used solely by automakers for catalytic converters. Both metals are also starting to see more use in jewelry, especially in Asia. Palladium is so much cheaper than gold. You can imagine that's definitely resonating with the youth in Asia. They can get something that looks like platinum but is actually much cheaper.

TGR: You said that geographic factors were very important in choosing gold equities. Do you feel the same way about companies in the platinum and palladium sectors?

JL: If you're looking at commodities, you have to. That concept goes across the entire spectrum.

TGR: Regardless of what business they're in?

JL: It doesn't matter if it's energy, metals or bottling Coca-Cola. If a company's not in a geographically and politically sound area, investors should think twice about investing in it.

TGR: You mentioned platinum and palladium were going to increase as gold takes off. What do you think about silver?

JL: In my opinion, silver has been gold's evil stepchild for years. And I continue to view silver as an overlooked commodity. Uses of silver continue to increase, and I like the prospects of the metal very much. Right now, platinum and palladium are the sexy metals, so to speak, because the ETF is new. However, I think silver prices will surge above $20 by year's end or in 2011.

TGR: What about ETFs?

JL: The volatility created by these ETFs is historically known to take the price of futures higher. You can apply that to crude oil, natural gas, gold or silver. Platinum and palladium are the new kids on the block that will benefit from the same concept. One of the reasons the Commodity Futures Trading Commission (CFTC) is looking to curb speculation is because it is a major driver of commodities these days.

Recently, a trader told me that if the CFTC puts regulations in place and limits the amount of contracts individual firms can trade, it might actually do more harm than good. That's because more violent price swings can actually take place if there's less volume. It was interesting to hear a trader say that. It makes me think that, as much as these ETFs seem like a blessing from above, they're probably one of the worst things to happen to the commodities market.

TGR: Given what you've said, do you anticipate government regulations on these ETFs; and, if so, in what timeframe?

JL: Government has too much on its plate right now to handle everything at once. In a month's time, we'll be talking about the CFTC regulations on energy and metals. So I don't necessarily think ETFs are right at the forefront of new legislation, but I do think it's something we'll hear about in the near future. There's so much happening on the regulatory side in terms of energy prices and metals; concentration needs to be focused. As we saw with the healthcare plan, you can only do one thing at a time.

TGR: Of course. Thanks so much for your time, John.

By arrangement with: www.theaureport.com

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