williemo

Despite Economic Headwinds, Gold Will Outperform

I agree, in gen'l about gold, however, don't trends and momentum have to be considered,,,,,,as well as the historic relationship between the commodities of gold and oil? If so, either oil better go up 50- 100% in the next 3 months, or gold will need to come down to earth a little......maybe some of both. With the historic mean in the two commodities' prices over time being about 9 (gold to oil), the ratio is at an extreme right now at about 20. Regardless of all the reasons why gold will be the currency and metal of choice in the years ahead, it may not be the right time just now. We have a tsunami of deflation hitting us that is larger than any current demand for metals. We have actually made good $ the first part of the year shorting gold stocks, and feel we've only touched the surface. If asset rotation eventually rolls from oil stocks completely, leaving it at $40/bbl or below, then possibly the longer term relationship of the two commodities might be more apparent and it might just start raining gold, all the way to $650 or so. Who knows? It's worth a thought.