Back in June 2002, I showed readers how to buy gold for $250 an ounce. I've been an unwavering gold bull since.

Until today.

Gold seemed easy to me back in 2002... It was cheap, hated, and the uptrend was just beginning. But nobody would buy it. Nobody would take my advice.

Gold was so hated, even my parents and my in-laws wouldn't buy gold... and they buy just about everything I recommend! Hey, these folks love me... but they also knew that gold had been dead money for 20 years. Even they couldn't pull the trigger.

We started buying gold as "cheap financial catastrophe insurance." After all, when is catastrophe insurance the cheapest? When there is no catastrophe... The last financial "catastrophe" was the late 1970s/early 1980s.

We're in one again.

Gold has soared. The cost of insurance has risen from $250 to $900. It can keep going. I don't know how high.

But now we're reaching a scary place... For the first time in a quarter century, people are willing to talk about gold. Legitimate investment banks actually say it will go over $1,000 an ounce this year.

(I'm not making this up: Citibank now predicts we'll see $1,000 an ounce in 2008, the Financial Times reported on Tuesday. The newspaper said, "Key gold traders such as UBS, Mitsui Precious Metals, Barclay's Capital, and The Bank of Nova Scotia expressed a similar view." Wow!)

Everyone's a gold bull now. The Financial Times also said, "Speculators on the New York gold market hold 10 bets on higher prices for each one held on lower prices." Now that is extremely scary.

The bullishness is even scarier in silver... Unbelievably, in last week's London Bullion Market Association poll, all 21 of the analysts polled predicted we haven't seen the highs for silver yet.

When I first started recommending commodities, there was no supply, and plenty of demand. So we bought.

But now, in the case of silver, it's the opposite...

"New mine supply is rising strongly," the Financial Times tells us. "Deutsche Bank is forecasting the silver market's supply surplus will rise from 66.2m ounces in 2007 to 82.5m ounces this year and 91.2m ounces projected for 2007."

So supply is rising. But silver demand is down... You see, silver used to be used significantly in film. But with the rise in digital cameras, silver use has fallen by 22% in cameras.

More supply. Less demand. Economics 101 says we'll see lower silver prices.

Yet speculators have disregarded this... Silver just hit 27-year highs.

With all the excitement, I'll take the contrary view. Personally, I don't hold any gold or silver stocks right now. With the exception of Seabridge Gold, I don't recommend owning any silver or gold stocks right now either.

But I'm not betting against precious metals. I know that in my career, I've seen things early... I've gotten in early... and I've gotten out a bit early. And my "new year's resolution" for my investments is to NOT bet against a trend.

So we'll continue to ride the gold bull market... a trend readers of mine have ridden profitably for many years.

It's tough to hang in there when you know something is getting crazy... when you know it's in all the headlines and people are starting to talk about it. It's like real estate in 2003, or dot-coms in 1998.

My unscientific guess is that we'll have a violent correction in the near term, to cool some of this excitement. Then we'll return to the gold bull market and have a few more years to run.

By that time (in a few years), gold will likely be the talk of cocktail parties.

And it'll likely be time to move on to the next big thing...

My goal in my newsletter True Wealth is to identify that next big thing, and to have made triple-digit returns on it safely – before it reaches the cocktail parties.

Your Last Chance to Buy Cheap Gold $500 Gold? It's a Bargain

Our readers first bought gold at $250 an ounce in our June 2002 issue, when gold didn't make the back page, much less the headlines. Now with gold making headlines at $900, I'm getting nervous for the first time in this gold bull market.

With experience as our guide, it probably means we have a few more years to run, but the "easy" money has been made.

Good investing,

Steve