sdavid0419

Stock Market Overbought: What This Means for Silver and Gold

I was all ready to jump all over rick12345 when manaboutdallas did it so aptly in front of me. All I can add about fear mongering is the real numbers that I am seeing. 1.8 trillion deficit and growing. 56% of gnp going to sevice the debt. Growing (not shrinking) unemployement. A president hell bent on yet another BIG government program like the IOU's in the Soc Sec lock box or the out of control costs of Medicare aren't bad enough. I'm not mongering the fear I'm just reading the numbers and trembling!!!!!!

Speaking of Gold...

Inflation began when oil prices soared post Katrina. Then in what I call the pre-election collapse of oil prices actually caused deflation. Now oil is once again on its trek up as the oil companies spend millions to keep Congress from acting on T Boone Pickens alternative energy plan. At the same time the banks are paying off their government loans as fast as possible so they can get back into the poker game since the government has failed to take action to put an end to the risky behavior. Oh did I mention the banks are spending millions to keep congress from doing that.

I had some significant gains in gold's run up. I'm the type that takes a short profit and runs at the first sign of a sell off which is how I was able to get some gains. Somehow, I have resisted selling off my current position through several cycles as I am so sure that Mr. Bernakes printing of money will cause hyper inflation and that the gold I'm holding is only an insurance policy. I don't expect it to be worth a gazillion dollars like most gold bugs but I do feel it will be worth more than the dollar once inflation sets in and that is a fact I'm relatively certain of. I vividly remember the Regan years when I was not market savy and I don't want to go there again.

Gold Stocks Look Cheap - BMO

The Gold Barron, and I don't want to speak for him, said "gold mines" not "gold" was a bad investment. There is a big difference. Gold is a finite thing with a value reflecting true worth. If a side of beef goes up to $200/lb gold will reflect that value. On the other hand a gold mine has other things like unfair taxes from the 3rd world country they mining in or fines or other things like power cut off from such countries. When I held Newmont I saw a huge overnight loss due to the CEO being arrested for poluting the local waters, a point vehimently denied by Newmont. Actual GOLD is what it is.

Gold Traders Whipsawed

Perhaps the spike was caused by the unexpected announcement that energy and clothing price inflation hit a six year high and whenever the government is admitting to that much inflation we all know the actual amount is way higher. The deflation argument due to oil price collapse never materialized because all of the needy and greedy that suffered during the rise figured they were entitled to the bonanza created by the fall. Deflation NEVER happened althought the admitted inflation number got to its lowest point in decades. Now that the printing press is cranking out money as fast as it can print it the much needed inflation will be more obvious and faster. Folks there is absolutely no way at all our economy will ever generate enough revenue to pay off the debt that Washington is amassing without hyper inflation which will allow us to pay it off at pennies on a dollar. Note the copper in the pennies is or will be worth more than the paper in the dollar!!!!! Where would you rather ride out hyperinflation in GOLD or in a rapidly failing currency?