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Gold/Mining/Energy : Gold Price Monitor
GDXJ 113.27+0.6%4:00 PM EST
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To: Hawkmoon who wrote (55971)7/9/2000 12:40:27 PM
From: John Soileau  Read Replies (1) of 116815
 
Maybe the problem is that there is a widespread belief or perception that there WILL be a soft landing, and further extension of this unprecedented expansion. Greenspan has pulled it off repeatedly, and it's easy for investors to relax into the assumption that he will get it just right once again.
Aside from whether Greenspan will _in fact_ pull it off again, I think that it is the mere perception that he will that is currently ruining the gold stock party. Greenspan-enamored investors are not moving to a defensive posture in any big way yet, but defensive thinking is crucial to any substantial ramp up of investment demand for gold and gold shares. Without investment demand, I think we're "becalmed in the Sargasso Sea". Over time though we will see what the landing is really like; if the landing gear fails gold may take a shine. But if the wheels kiss the runway again...hello seaweed.
Then there's the worrisome chance that EVEN IF we have a horrible landing, gold and gold shares will not respond. Maybe defensive investment demand will just park in money markets instead, while gold shares languish further. We've had several disruptions in recent years that gold and gold shares did not respond to as expected. For whatever reason,
the economic disruption-gold relationship may have decoupled. Anyone else concerned about this?
John
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