Gary Tanashian

Newsletter provider, long/short equity, macro, gold
Gary Tanashian
Newsletter provider, long/short equity, macro, gold
Contributor since: 2005
Company:'s Notes From the Rabbit Hole
A simply excellent article Michael.
Sorry folks, two positions WERE mentioned. I disclosed otherwise. Regardless, I have no positions in either TWTR or FB, and no plans to initiate any time soon.
Thank you Sawdust... I almost don't want to go look, but I'll have to I guess. I can't say I am surprised. I am a gold bull and have been since 2002 but I just keep pounding the message that that does not need to mean incurring all kinds of pain during the bear phases. There is this thing called risk management. I have no fears about physical gold because it is there as insurance. Too many gold bulls seem to not understand the concept of insurance and value in a whacked out system. Hence, they attack. Same old same old and if it is as bad as you imply @ GoldSeek, then that is ultimately bearish because the psychology is still alive and well.
Thanks to others here for your thought on the article too. Appreciated.
It is worth noting that inflation effects have sprung up on this cycle, but they have rooted in the stock market, not in the 'bad' areas like commodities and gold.
Good points. The article was actually pulled from my site where I make assumptions that people know the inside jokes and irony. I'll try to clean that up for SA articles in the future.
The US dollar is in a downtrend by daily and weekly charts, but is most certainly in an uptrend on the long-term monthly shown above. If the break is down then that will change. If the break is up... not so much.
I actually agree with you VSKzn. We are in highly unconventional territory. I am not saying it is healthy. Indeed, I believe the average participant has simply come full circle from March, 2009. I just finished writing an NFTRH report that notes exactly that, how many traditional indicators are on the fritz, much of it due to the degree to which policy making has been intensively used as an input for the last 5 years.
You know, I try to avoid wearing the tin foil hat because I look stupid in shiny head gear. But anyone who says markets are not manipulated is just not thinking it through. Markets are all about manipulation, but the gold "community" personalizes it too much IMO.
Dialing out to the setting of rates of interest, that is all the manipulation needed. Men and women deciding what rates will be on the Fed Funds, trying like hell to influence rates on other durations Op/Twist and QE. It's all manip, and it is working because we are in a phase of market compliance to policy makers' every utterance and action.
QE's removal theoretically at least pressures long term bonds, which (again theoretically because it may actually work opposite or contrarian), given the ZIRP at the borrowing level, is a positive for banks. Now with recent data showing banks have increased commercial lending you can see why the removal of QE has its positives for the economy and by extension, stocks.
Gold is counter cyclical and anybody boosting gold along with commodities and non US stock markets is barking up the wrong tree.
Agree Yasolav. But it is wise for gold bugs not to actively fight the process with their own speculative funds. Physical held for personal reasons is a whole different story.
Love the Doctor Fed metaphor. We as humans deal in the here and now, but over time these markets and the perceptions of we little bit players, ping back and forth. In 2011 mobs with pitchforks (led by Bill Gross who was short the long bond) were assailing Bernanke. In 2014, the Fed has it all under control. Cue the old Outer Limits shtick...
'do not adjust your television set, we will control the volume, make the picture flutter...'
Thanks Mikdns, did!
GOGO meandered out of a bullish falling wedge a while ago. This has been a classic bullish consolidation.
First of all, thank you all for the intelligent and well thought out comments. I was cringing when I checked because I thought I'd get my feelings hurt (just kidding, comes w/ the territory).
When it comes to the US 3Dp's I am not talking so much about survival as valuation. There is a big difference. The industry will survive and flourish, but the question is whether today's valuations are anywhere near the reality of the future earnings they are supposedly forecasting?
I think that is wise Sky. ;-)
Short term casino thinking (about prices) is the reason why so many people are in agony now. Gold is probably going to sub-1150 and anyone who bought (hint hint) in 2002 and 2003 should not lose a wink of sleep.
Hi BLTS, Not sure about most people but I became alarmed early last decade (started the website in '04 based on this alarm) about the policies that were creating a massive bubble in commercial credit/debt in order to promote (inflationary) growth.
This cycle we are on an 'official' credit cycle (as opposed to commercial) as government paper is propped up to support the economy.
I am no expert on the 70's by any means, but I believe debt to GDP dynamics were much better then. Inflation was more honest and open.
This time around the inflation is not 'getting out there' and driving up prices and policy appears genius. We cannot know when this will be resolved on big macro balance sheet, which is the point of why I am portraying monetary insurance as a sensible part of doing business in this confusing atmosphere.
Nobody's got the answers this time around. At least I don't.
Well to tell you the truth, I am currently hedge by being short on silver. But if the gold-silver ratio rises, the USD is likely to rise as well. That has been an ongoing theme for an economic contraction.
What I am trying to say is that the enviro that is good for gold mining is also theoretically good for the USD. In this enviro Au out performs cost-input commodities like oil. The gold sector is fundamentally counter cyclical, as hard as that is for inflation bulls to believe.
There is IMO a reason why gold stocks have been so lame for so long, and that is because inflation bulls insist they are part of the inflation play. But in that enviro, their fundamentals actually degrade.
Hi ilc,
Yes, I suppose I meant it in a somewhat cynical way. My point was that this administration would be a promoter of inflation (just like the last admin) but that the targeted groups of beneficiaries are different. Of course the banks happily use and abuse the money first, as usual. Same system, different beneficiaries (after the banks get theirs).
My apologies dear readers (and SA)... right under the Dow chart should be this paragraph, which helps make sense of the one that follows.
"Interestingly, today’s Dow is mimicking the average election year to near perfection! I am going to assume that the market has no clue yet who it thinks is going to win."
My pleasure Leftfield.
My pleasure Colin. Thank you for reading!
My pleasure Colin. Thanks for reading.
I am prepared for them to go down in the short term. Not predicting, but some evidence says 'be prepared'. Big picture, a-okay IMO.
YUP... that was me. It was a target. But it got scrapped in March when HUI lost a key level.
100% agree. That is the big picture, and it is why speculation is fine... but only after one has seen to eliminating debt and getting the leverage out of their lives.
Thank you for your comments.
I started my website in 2004 because of catastrophic risk you note. I am not intending to snear at it. EVER. What I am doing is noting the cycles that play out over the years within this risk environment.
As an example, had I acted on my alarm in 2004 I'd have not only missed many subsequent profit opp's, but I'd have likely sat 100% in US dollars (I always keep a significant level there BTW) and fallen behind by leaps and bounds.
What I mean by the Age of Inflation onDemand is that we have an ongoing 'continuum' of deflationary pressure (I use the monthly TYX or USB chart to illustrate) that is routinely met by inflationary policy. This policy is always doomed to fail, but it has thus far reliably produced 'swings'.
I also believe there is going to be a 'final deflation', which would end the system.
Does this sound like snearing?
The target for the SPX is and has been (for many weeks now) 1200 to 1250. The play has also had gold miners leading. Check. People get so worked up about a headline and that is really not productive.
I have a feeling that is a question that many people who have no position are struggling with today. The open letter was written by NFTRH subscriber Larry Lepard, and I cannot give an answer for him.
Just be slow and patient.
Could you list some of them Gus? I'd love to see 'em all lined up.
Hanging tough Gripper. ;-)
I have been following a trend in GDM's bullish %, with a target of 5-10%, the top of which has been registered before a little up turn last week. Also Hulbert, and general public opinion and Rydex. I maintain an account w/ and am always watching sentiment. It is brutal, which means really bullish pending final bottom. Unfortunately, on straight technicals HUI can march lower.