Who says opportunity only knocks once? Today gold is banging on investor doors for an amazing sixth consecutive summer, looking for more portfolios to protect … and grow! I expect the pundits will now claim gold has fallen into a bear market, but here’s why they will be wrong… again…

There have been six major “corrections” to the current long-term secular bull market in gold that began in 2001:

1. 2003 - Gold at $382 dropped to $319 (-16%)
2. 2004 - Gold at $425 dropped to $375 (-13%)
3. 2005 - Gold at $536 dropped to $489 (-9%)
4. 2006 - Gold at $725 dropped to $560 (-22%)
5. 2007 - Gold at $841 dropped to $778 (-8%)
6. 2008 – Gold hit $1002 on Mar 17 then dropped to $823 on Aug 11, a 22% correction so far.

Gold's trend is your friend. Nevertheless after each correction the analysts on Wall Street claimed the bubble in gold had burst and lower prices would be seen in subsequent years. Obviously they have been wrong five times in a row so far and I firmly believe they will be proven wrong again this time.

Gold prices may fall near $800/oz. before the speculators are out and the fundamentals kick back in. Oil prices may fall below $100 a barrel or rise to $150-$200 depending on geopolitics. If gold follows its past moves, the next up-move will start this fall, taking gold prices to between $1,175 and $1,485 before the next major correction.

Secular bull markets in commodities tend to have a life of 15 to 20 years. I see the current gold market no differently. Even if gold simply adjusts for inflation we should see $2156. While there may be more volatility and wider price swings in this market, it has been seven years in the making. It is very different from the rapid run up and run down we experienced in 1979-80. Therefore comparisons to 1980 are not valid.

Georgia on my mind... Russia too!

The escalation of hostilities between Russia and Georgia are noteworthy to investors. Russia and Georgia are now in a war and Putin is clear about his lack of desire to consider the ceasefire the world is demanding. Even President Bush has called the action "disproportionate" and yet Russia is not listening.

Keep in mind, America is an ally of Georgia. Georgia has troops fighting side by side with U.S. troops in Iraq. Therefore I would imagine they will look to friends for help. That is why it is so important to examine the initial response from Russia.

Putin, while denying claims that he targeted pipelines, is having a hard time selling that to the international community. The Baku-Tbilisi-Ceyhan pipeline carries oil that is headed for the West to the Mediterranean Sea, much of that oil finds it's way to America.

The fact that strategic oil pipelines were targeted is a clear indication that Putin is willing to use the strained oil markets as political leverage in defeating the Georgians. Russians fight wars to win.

Russia is the second largest producer of crude in the world and they have been rather quiet since the Soviet Union’s breakup. But make no mistake about it. Russia is a powerful nation, with a huge military and nuclear weapons. Putin is KGB all the way and a very good friend of the Iranians.

Russia is one of the strong voices telling the world to leave Iran alone in their pursuit of nuclear capacity. Russia provides nuclear technology and material to Iran's nuclear program. Iran is a good customer.

So why is the dollar unaffected, oil stable and gold prices down after being stronger in Europe all night?

Simple: The world is in a slowdown and many are expecting currencies that have been extremely strong to weaken and weak currencies to strengthen. The belief in “demand destruction” for all commodities is dominating the traders’ attention and as such we are seeing a sell off.

Gold: more than just another commodity

GOLD IS MORE THAN JUST A COMMODITY, IT IS A STABLE CURRENCY. If gold was simply a commodity, supply and demand would dictate price. Since 2001, gold investment has been transformed from primarily being seen as a commodity to now being seen for what it really is: the ultimate global currency. A currency that is inflation proof and immune from collapse.

America’s founding fathers said money must have four basic characteristics: 1) Scarcity 2) Portability 3) Divisibility, and 4) Dependability as a Store of Value. "The dollar is slowly becoming an I-O-U nothing," former Fed economist John Exter once said. Why? Because real money must be derived from a commodity or it will eventually become fraudulent money.

The dollar has been in a bear market for 36 years. Gold prices fell to 2008 lows today on recent dollar strength but that strength will be short-lived, just as it has been since 1972 when the long-term downtrend for the dollar began. Sure there are periods of recovery, but each rally has failed. All bear market sucker rallies do just that. They suck people in just before the next drop.

This week will be crucial in determining whether the dollar has broken free from its 36-year downward trend as we get the latest figures on the U.S. trade deficit and inflation. I expect both to expand faster, thus bringing the dollar rally to an end.

If the action in Russia doesn't calm this week, we should see upward pressure on oil and gold prices. Any major disruptions of natural gas or crude out of Russia may be viewed as an act of aggression to other nations, not just Georgia.

Time to Go for Gold!

Now is a time to focus on keeping your money safe by diversifying assets out of paper and into tangibles – including the world’s most stable currency – GOLD.

So if you are long gold stay long. If you haven't participated in the greatest gold bull ever, it is not too late. This recent pullback should be no different than any other and represents a great opportunity.

I see the greatest value in the gold market today in early American $20 gold coins and gold commemorative coins. These markets have not experienced the same growth as gold bullion yet held very well during this correction. That is a clear sign this area of the gold market has incredible strength and is overdue for a big increase.