Burticus

Precious Metals: Breakout, Fakeout or Shakeout?

I agree with LR. Regarding (3) a shakeout, I thought I just saw a huge one over the last year, since August 2008?

As JPM said, "Gold is money. Nothing else is" (except silver). Gold and silver do not change. Honest men have used them to store their wealth for eons. Only the paper/electron currencies change and they all just went down vs. gold, as they always inevitably do over the long term on their way to their intrinsic value of zero.

The markets? Wall Street fraud king banks are all insolvent zombies, yet while loan defaults and the derivatives death star loom, share prices soar. S&P P/E ratio is stretched over 100 to 1 even with fake earnings thanks to FASB sellouts. Gangsters running gubmint, printing/keying more fake money, handing it to their pals, skimming 100 million daily using computer trading and front running with the exchanges. CFTC pummels oil longs while banksters short 200,000 gold and 40,000 silver contracts. China revolting against the UK-US bankster cartel, frantically swapping FRN$ for resources, doing currency swaps, stockpiling gold, promoting silver, its stock market tanking again, saying bleep you on contracts "hedging" aforementioned silver shorts. Hahaha!

October stock market crash to new lows seems imminent to me, even with prices propped up by money printing and porkulus/scamulus.

After the stock ring is piled high with towels, starting late October to November, those who stampeded to "safety" of FRNs, Treasuries and bonds, will get vaporized in the dollar collapse through 2010. Real gold and silver (not paper) will be the only things left standing among the crispy critters in the twisted smoking wreckage.

Fundamentally, technically, interventionally (?), I would not want to be short silver or gold right now, unless I could create money and steal the metal to cover my positions.

Disclosures: Long physical gold, silver, steel, lead, food, rope