Gold Editorials & Commentary

Since 2005 we have shared our thoughts regarding our expectations of how the markets might move in this current large cycle.

People everywhere are depressed and confused. Their depression is due to their net worth being severely lacerated and their confusion arises as a result of not knowing what to do next.

The next gold bull market could be just around the corner and with thought in mind; it has many traders and investors on edge, because they are worried they could get left behind.

March 20, 2009 -- I've written in the past that if you want to make 'BIG' money in the market, you have to take an over-sized position and be dead right on the trend. The last time I did that was in late-1958. I was very bullish on the market at that time.

It seems the dead cat bounce may now be behind us as the US markets resumed their decline late in the week after testing important breakdown levels.

Last week a very dangerous precedent was set when the Fed announced that it is going to start overtly intervening to backstop the ailing Treasury market. The market's verdict on this announcement was immediate and unequivocal.

On Wednesday, March 18, another handsome gift was delivered by the Fed to the bond bulls.

The party was good while it lasted or at least that is what we thought.

GLD - buy signal this week.

TORTURE

What a crazy day! The Fed's announced plans to buy long-term Treasury bonds and increase its purchases of mortgage backed securities today sending everything higher except the US dollar which plummeted nearly 3% Wednesday.

You may have heard the old saying that "the Market is the news", and it is true.

USTREASURY BONDS AS COMPETITOR FOR GOLD

As of the close yesterday (and actually before then), the 50 year returns for holding physical gold are much higher than the 50 year returns for the Dow Jones Industrial Average.

I've heard more than a few pundits question an investment in gold or gold stocks in the current environment. They point to deflation and the lack of inflation in the foreseeable future as reasons why precious metals should be avoided.

Market analysts, investment newsletter writers and financial planners are always commenting on how well, or poorly, the precious metals (read gold) mining sector is doing based on how a particular gold/silver mining index is trending but they are not telling yo

This analyst has been watching the markets in the past couple of weeks with a fascination akin to that associated with watching a snake charmer in action.

The week finally saw a bounce from the past many weeks of declines. It wasn't so much that good news rallied markets, rather a lack of bad news for a change.

GLD - on sell signal.

This is the second part of a conversation I was privileged enough to have with the great Mr. Jim Rogers.

Gold bullion and Crude Oil are both setting up for a rally higher if they continue to complete the breakouts.

I had the pleasure to talk with the famed investor and world traveler Mr. Jim Rogers on February 2nd, 2009 and I have finally gotten to transcribing the conversation.

"We are spending more money than we have ever spent before, and it does not work.

A speculator is a trader who approaches the financial markets with the intention to make a profit by buying low and selling high (or higher), not necessarily in that order.

GLD - on sell signal.

This was one of the most news filled and busiest weeks I have ever had. Bailouts, lies and deception ruled the week. The events unfolding could hardly be imagined by most even a month ago, let alone years ago.

In my previous article I was calling for a trend acceleration in gold. My recommendation was to build and maintain a core position in physical bullion held in your own possession.

Gold and gold stocks have had a nice controlled correction over the past 9 days. We look to be nearing the bottom of the bull trend channel, which could be a great buy point.

A couple of bright friends reported to me some overriding themes at the PDAC gathering in Toronto last weekend. Apparently, some surprise came to them. They mentioned that more than a few analysts, writers, and speakers still do not get it.

In summary, the following analysis/argument concludes that Depression is a far more likely outcome than Hyperinflation.

The mathematics of inflation is as follows: