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  • The Gold Market Is Going Insane [View article]
    My anecdotal and very unscientific take on gold market sentiment over the last 3 years, in 2011-12 gold bulls like Eric Sprott were so certain that gold was going much higher while many remaining bears were conceding that it could still go higher. Today I see the opposite, with many gold bears certain that the price is going lower while steadfast bulls concede it could go lower in the near term.

    It reminds me of the Bertrand Russell quote:

    "The whole problem with the world is that fools and fanatics are always so certain, and wiser people so full of doubts"
    Oct 19 01:51 PM | 1 Like Like |Link to Comment
  • IAMGOLD: A Falling Stock Price In The Face Of Improving Fundamentals Presents A Unique Opportunity [View article]
    On the subject of political risk...
    Apart from the variety where a country descends into utter chaos, Political risk is usually greatest when gold prices are high and miners are seen to be making obscene profits. When prices are under pressure and miners are walking away from projects as they are today, foreign governments are less likely to squeeze them and more likely to adopt a favorable investment climate.
    Oct 15 09:44 AM | 2 Likes Like |Link to Comment
  • Is It Time To Just Give Up On Gold? [View article]
    The only reason I can see for the underperformance of GDX recently is that investors do not believe the recent rally in gold has any legs. Miners' costs are not going up, that is yesterday's story. If you look at the last several quarters costs have been coming down. The recent drop in oil and diesel prices will bring them down further as will the higher US $ for mines operating outside the US.
    Oct 12 11:35 PM | Likes Like |Link to Comment
  • Is It Time To Just Give Up On Gold? [View article]

    You say:

    "...This was my initial confirmation that I was correct in my assessment of going against the majority belief, and maintaining that metals will make lower lows this year."

    And then go on to say:

    "Yet, the fact that GLD and gold have not broken down below their 2013 lows yet has still left some potential for them to rally much harder than most expect."

    My question concerns your take on the "majority belief". You seem to suggest that the majority saw little chance of gold making lower lows, but now most expect little chance of a rally. Is that right?
    Oct 12 10:50 AM | Likes Like |Link to Comment
  • Is It Time To Just Give Up On Gold? [View article]
    I think at this stage another round of QE would result in a loss of faith in the omnipotence of central banks. It would likely only happen with a severe turn in the economy and while S&P might go up, it would only be after a severe drop from today's levels. As for gold, on balance it did go up over the course of QE, from $800 before QE1 to $1200 today and would likely go up again with the introduction of a new round. Gold has been trading against faith in central banks with the price moving up as the faith wanes and down as faith grows.
    Oct 12 10:33 AM | 4 Likes Like |Link to Comment
  • Gold Is Against The Ropes [View article]
    I've notice lately a lot of comments/articles on gold miners referring to the cost to mine an ounce of gold as though it was in immovable level. Just as the price of gold went up dramatically over the past 10 years so did the cost to mine it. Some of that is because miners went after lower grades, but some is simply because of the cost pressures inherent in a booming industry - including competition for limited skilled labor, for equipment and parts, and higher diesel prices. Doesn't it seem strange that while general inflation levels have been extremely low, mining costs have soared? These costs can and are coming down and will continue to as the miners retrench. They likely won't come down fast enough to keep miner shares from dropping with the price of gold for now. But it will take a lot lower prices than $1000 to bankrupt most miners.
    Oct 5 10:07 PM | 1 Like Like |Link to Comment
  • GLD: Lower Lows Will Be Seen Whether You Like It Or Not [View article]
    I'm not convinced it was causal but your premise was that gold tanked in the face of QE which is not exactly true. It may be that gold simply got ahead of itself and over shot any increase justified by QE.

    One thing you have convinced me of is that fundamentals matter very little in the short and medium term, especially in an emotionally driven market like gold.
    Sep 21 02:08 PM | 1 Like Like |Link to Comment
  • GLD: Lower Lows Will Be Seen Whether You Like It Or Not [View article]
    So on balance QE was, if not causal, at least coincident with a rise in gold price ($800 in 2008 when QE began and $1200 today as QE likely nears its end).
    Sep 21 01:48 PM | Likes Like |Link to Comment
  • GLD: Lower Lows Will Be Seen Whether You Like It Or Not [View article]

    You say, "seasonality was going to override everything else - including sentiment - and cause metals to rally to the moon. And, once again, everyone was so certain of this outcome based upon market fundamentals."

    I think in this case your reading of the sentiment out there is misplaced. I don't think I saw a single article suggesting September would bring a "moon shot" in gold price. The most positive I saw suggested the price could be supported by Asian buying in September. Indeed I would say the sentiment was decidedly bearish going into September with many saying seasonal factors might at best slow the decline expected.

    Also one other small quibble. I assume in your mention of QE and the contrarian trade, you meant to say "When QE3 was first introduced..."
    Of course QE was first introduced in late 2008 and gold skyrocketed for the next three years and is still above the pre-QE price. Only as operation twist and later QE3 were introduced did gold hit a wall.
    Sep 21 10:38 AM | 1 Like Like |Link to Comment
  • New Low In Silver; Lower Low In Gold Still To Come [View article]
    Thanks for the reply. I will continue to follow your writings with interest.
    Sep 14 04:06 PM | 1 Like Like |Link to Comment
  • New Low In Silver; Lower Low In Gold Still To Come [View article]
    Avi, you say:

    "We have not yet seen the ultimate lows in the metals for this 3+ year correction. The only questions are how and when we get there."

    You seem to have been mostly right in your calls during this gold bear market and I appreciate your thoughtful, unbiased analysis. But I have to say I am immediately suspicious of anyone who is so certain when it comes to market outcomes. It reminds me of the absolute certainty in the voice of many goldbugs that claimed $2,000 or $5,000 was just around the corner.

    Methodologies that rely on technicals appear to work for a time but by the time their predictive powers seem infallible, the number of adherents has already skewed their forecasting ability.

    Really? "The only questions are how and when we get there"? You can't think of any other possibilities?
    Sep 14 02:19 PM | Likes Like |Link to Comment
  • New Low In Silver; Lower Low In Gold Still To Come [View article]
    Remember the laundry list of gold-positive news/events this time 3 years ago?

    Europe and the Euro were on the verge of collapse
    The USD had been in a dramatic decline for more than a year
    Talk of excessive debt worldwide was a t a fevered pitch
    The stock market was in full correction mode.

    And yet Sep 2011 marked the top in gold.
    Your last line would better read, "All that and much more WAS detrimental to the gold price."
    Sep 14 01:47 PM | Likes Like |Link to Comment
  • Some, But Not Enough, Progress At Kinross Gold [View article]
    Catalysts: don't forget potential sale of FDN, currently carried at $0.
    Aug 21 01:41 PM | Likes Like |Link to Comment
  • Why Kinross Investors Are Over-Reacting To Russian Exposure [View article]
    Agree there are more upside than downside catalysts to the price.
    Would just add two more: the possible restart of La Coipa after promising exploration results and the possible sale of FDN which is carried at a value of $0.
    Aug 8 11:42 AM | Likes Like |Link to Comment
  • Don't Buy This Dip: The Fed Is Not Your Friend [View article]
    Thanks for the link - interesting. Of course some significant differences between then and now:

    By the second half of that decade much of the developed world was in the midst of a massive baby boom. That, combined with post-war rebuilding efforts would ensure decades of strong growth. Those baby boomers are retiring now and will be drawing down investments not adding to them.

    The US was the only major economy whose capacity to produce was not destroyed by the end of the war and so was in a unique position to benefit from the rebuilding.
    Aug 5 03:38 PM | 6 Likes Like |Link to Comment