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  • GLD: Maybe It's Time To Go Long? [View article]
    As GLD approaches the 140 level and then goes through it, I suspect that those who have been shorting will be very sorry that they did. The long term gold bulls have finally gotten some evidence that the gold bull has resumed and they don't want to believe it and worse yet, may even be shorting with the expectation that AVI's call for one more wave down will eventually come to pass. They didn't want to believe gold could go down in 2013 and now don't want to believe that it will continue to rise.

    This is how the market works, with some loser always being convinced to be on the wrong side of a trade.
    Jun 23 10:43 AM | 2 Likes Like |Link to Comment
  • Commodity Prices: Basics For Businesses That Buy, Sell Or Use Basic Materials [View article]
    Oil is one commodity that is not going to get cheaper in the long run. It is only a matter of time before demand finally overwhelms supply on a permanent basis. If fracking had not enabled man to extract more oil from existing fields, we would be there already.
    Jun 22 01:22 PM | 2 Likes Like |Link to Comment
  • GLD: Maybe It's Time To Go Long? [View article]
    AVI: If I am understanding you correctly, the right play would be to short GLD now and to continue to do so even if it gets up to 140, in order to be well positioned for a fall to the 100 level. I am not saying I agree with you, but do wish to understand your strategy.
    Jun 22 12:18 PM | 1 Like Like |Link to Comment
  • Precious metals soar as Fed stays dovish and Americans head into Iraq [View news story]
    Macro: The 2.3% rate for the US is a past 12 months number, not a one month extrapolated calculation. It may not be a trend, as you have suggested, but I believe that the behavior of the PM's is saying otherwise.
    BTW, the XIV/SVXY strategy is excellent. (XIV is an ETN and therefore less desirable than SVXY) I have been waiting for a significant jump in volatility and a draw down before buying in which, in hindsight, was a not a good idea as SVXY has marched upwards.
    Jun 22 11:34 AM | Likes Like |Link to Comment
  • Precious metals soar as Fed stays dovish and Americans head into Iraq [View news story]
    Macro: Welcome back! Sorry, but your data is already obsolete and to a gold trader, of little relevance . How about if we look at some data that is a little more recent, up to May of 2014?

    The three largest economies of the world are that of the US, China and Japan. The combined GDP of just those three is almost double that of the next seven largest. Two of the top three, the US and Japan, have seen their CPI rates jump significantly during the past 12 months (vs 2013). The US went from 1.14%(2013) to 2.3%. Japan went from 1.5% (2013) to 3.41% and China's rate is up slightly to 2.5%. These numbers are not just "noise". It is laughable how the government (and media) can perpetrate a con job on the public with talk of deflation when exactly the opposite is occurring!
    Three other countries that are in the top 10, Russia, India and Brazil have unacceptably high rates (2014) of 7.58%, 7.08% and 6.10%, respectively. Deflation? Not bloody likely!

    Let's not pretend that inflation is remaining subdued. Despite the government's best attempts to mask the true extent of inflation, by way of continually changing a calculation methodology that purposely mitigates actual price increases (hedonics), the numbers are still bad enough to paint a not so rosy picture. Is it not obvious that inflation is moving up and doing so rather quickly, every time we buy the necessities of life like food, gas, insurance, health care, tuition, haircuts, paper goods, services... did I miss anything?

    I suspect the smart money saw what was coming some months ago, and that may explain why gold , after bottoming nearly a year ago, has since been moving up in stealth fashion with series of higher lows. The most recent surge is likely not just not a 'bounce' as some have suggested, but rather, a taste of what is to come: higher gold and silver prices.
    Jun 21 09:53 PM | 3 Likes Like |Link to Comment
  • Gold Benefiting From Behind-The-Curve Fed [View article]
    The correlation between interest rates and gold is inconsistent over a long time frame. Inflation, on the other hand, provides a much better correlation but with a time shift. Rising gold precedes inflation. BTW, gold doesn't 'care' about the phoney massaged numbers provided by the government. Real inflation is what matters.

    The value of energy is probably the best correlation with gold and will become even more so as more nations begin settling their oil transactions with gold. It is important to note that this could happen without the US dollar declining significantly against other major currencies, given that nearly all the major trading partners are debasing their currencies at much the same pace as the US. In the not so distant future, it is going to take a whole lot more of everyone's currency to buy a barrel of oil or a loaf of bread even while retaining much of their relative value to one another.
    Jun 21 02:27 PM | Likes Like |Link to Comment
  • Gold Benefiting From Behind-The-Curve Fed [View article]
    Stephen: Nicely put.
    Jun 21 02:15 PM | Likes Like |Link to Comment
  • The Government Debt Ponzi [View article]

    The debt of any country is meaningless so long as they have the authority to print more fiat money at will. Just look at Japan. The bankers are only doing what they must do in order to keep the current financial system functioning. It is the ultimate 'kick the can down road' methodology. The bottom line is that the current financial system is deeply flawed in that the only way debt can be serviced is if more money is created, normally by way of further expanding the debt load! Money created by in other means (just printing as the FED has been doing) is very dangerous in that it ultimately hastens a loss of confidence. China, and others, are dumping US treasuries for a reason! The whole mess is an obvious 'Ponzi' like scheme that works well until creditors lose confidence in their ability, in the future, to exchange paper holdings into something truly valuable, such as oil.

    The fact that certain countries are demanding repatriation of their gold held in foreign banks is a sure sign of a loss of confidence in the dominant fiat currency, the US dollar. As gold continues to rise, demands for repatriation will become louder. That said, it is unlikely that gold will ever be a permanent means of backing up the world's currencies, simply because there just isn't enough of it to go around. That doesn't mean that it won't be tried, but that it probably won't be successful for very long due to the fact that growth becomes restricted by gold supply.

    A one world currency tied to productivity is the ultimate solution but that's not likely to happen anytime soon. A complete collapse of the current system is probably necessary before the governments of the world get serious about reform. Shrinking energy resources will be the probable catalyst for change as everyone races to exchange as much of their devaluing fiat paper as possible for a rapidly dwindling supply of oil. I expect that we will see hoarding on a grand scale.

    I am 62 and most certainly expect to see the end game before I become too old to care. Right now, my money is riding on gold, silver, oil and even unloved coal.

    Jun 21 01:15 PM | 2 Likes Like |Link to Comment
  • Precious metals soar as Fed stays dovish and Americans head into Iraq [View news story]
    Doug: The dollar index you refer to only tell us where the dollar stands against other major world currencies, all of which are declining in 'value' (purchasing power) due to worldwide inflation. Currently, gold is rising in terms of practically every single currency on the planet, more so in those currencies which are falling relative to others.

    The fact that the US dollar index has been sitting near the 80 mark for sometime does not mean that it has been retaining value versus a basket of commodities. In fact, the CRB index of commodities has shot up a whopping 9% since the beginning of the year. It is quite conceivable that gold could appreciate 20% or more without the dollar index budging from the 80 level.
    Jun 21 11:28 AM | 1 Like Like |Link to Comment
  • This Is When The Bear Growls [View article]
    A correction is 'overdue' and has been for a couple of years now. A bear market is also 'overdue'. These two truths, thus far, haven't made the bears a single dollar, myself included. Given the complete dis-connect between the market and the reality of the true state of the economy, there is absolutely no way of knowing how high the banks will take this market before a big player gets nervous and bolts for the exits. Clearly, the state of the economy is not the number one factor.

    I will continue to add small incremental short positions (via inverse ETFs which do not have expiry dates like options) on the S&P, while adding to gold and base metal positions and maintaining, but not adding too, coal and oil long positions.
    Jun 21 11:09 AM | 2 Likes Like |Link to Comment
  • Natural Gas Sags 1% After Inventory Report, Injections Will Fall Sharply In July [View article]
    It's time to stand aside and see how things develop. (as in a possible heat wave in the northeast that would up usage for power ) I am hoping we will see some kind of low near the end of August so that we can load up for the Sept-Oct rally.
    Jun 19 11:08 PM | Likes Like |Link to Comment
  • Precious metals soar as Fed stays dovish and Americans head into Iraq [View news story]
    Doug: The banks are now a major player in just about every market you can name. The correlation between the FEDS expanding balance sheet and the S&P is quite convincing. It would be naive to think that the trillions of 'printed' money is doing nothing while it sits as an entry into the reserves of the banks. In an environment where trust in the financial system is under duress, it is a logical course of action to secure assets with a fiat currency that is declining in value. That, I believe, is what the banks are doing. Make no mistake about it, as the world shuns the American dollar as being the favored currency of trade, it is going to take a whole lot more dollars to buy anything of value.

    There just isn't enough gold to go around for everyone and any attempt to acquire massive amounts of gold would become a bidding war very quickly. (that said, gold should go up as it will be the choice of the masses) An alternative for retaining wealth is to own and possibly, control, the world's largest corporations. I really don't think the banks are terribly concerned about how much they are paying for a stock, given that there has been a steady supply of free money from the world's central banks. It should therefore be no surprise that the markets are at record highs without the support of a healthy economy.

    The VIX can remain at very low levels for extended periods, as it did during 2005-06. Yes, it does give the media something simple for it's readers to focus on. Other than that, it's usefulness as an indicator is questionable. Saying that the VIX is low and therefore the market is due for a correction is much the same flawed logic as concluding that the market is due for a correction just because it has made a new all time record. Of course, it doesn't work that way.
    Jun 19 10:39 PM | 3 Likes Like |Link to Comment
  • Precious metals soar as Fed stays dovish and Americans head into Iraq [View news story]
    I don't think the rally is a dead cat bounce nor did it have anything to do with Iraq. Rising gold is symptomatic of a creeping loss of confidence in a financial system that is entering into the end game of the gigantic ponzi scheme that it is. Using money created out of thin air, the banks are acquiring as many assets as possible before the next banker beats them to it. Allowing banks to get into the commodity and equity markets and then loading them up with trillions in reserve money was like giving the candy store keys to children with the expectation that they will behave responsibly.

    Gold's long term chart, on a monthly basis, is looking quite positive. As a contrarian, I am encouraged that a number of former die hard bullish authors and commentators, who rode gold down as it collapsed in 2013, are now calling for 'one more' wave down to $1000 level (Ellliot Wave deduction). That may be, but I would much rather be long, than short, at this point.
    Jun 19 08:59 PM | 7 Likes Like |Link to Comment
  • Is This The Real Life, Or Just Fed Fantasy? [View article]
    Thanks for the thoughtful article. At this stage of the game, there is no way to know when we will see the final top. Conceivably, it could be months away. A correction is overdue but that may not occur any time soon given the tremendous sway the FED and the banks have over the market and who do not want to see a market declining while maintaining the facade a durable recovery taking place. (Not!)
    Jun 19 11:21 AM | 3 Likes Like |Link to Comment
  • Gold Investors: Let This Cycle Be Your Guide [View article]

    Given that interest rates are not making new lows, it would seem that we now are entering into a phase 1 cycle after a very extended phase 4. It is quite possible that we will see a significant improvement in gold prices over the next several months.
    Jun 17 08:38 PM | 1 Like Like |Link to Comment