Switzerland & Kuwait may become small catalysts shortly -
...also; once Crude Oil corrects & the Euro finds a bottom; OPEC will be receiving perhaps 20-25% less for the price of Crude & simultaneously be receiving payment in a weaker US dollar - OPEC will & has to hedge this "net receiveable loss" via gold hedging.
The Kuwaiti's will call in their loaned out physical before crude corrects here shortly & here is an interesting comment on what the Swiss may do as well:
news.ino.com
<< Dollar/Swiss franc mirrored euro/dollar's meek tone with a rally to a new 11-year high at 1.7801. The rally was slowed down by ongoing rumors that the Swiss National Bank might capitalize on the opportunity of the strong dollar to repatriate some of the proceeds of its gold reserves sales. >>
...comments on the Euro trying to find a bottom - catpitulation ? - imo; if it's not the bottom; it's damn close. XAU acting very healthy here technically.
<<... "Capitulation trades," said Ashling Freihert-Kintch, FX strategist at Morgan Stanley, summing up today's euro sell-off. Sources noted major sell-stops being triggered at $0.8800, $0.8756 and at $0.8737 as several U.S. investment and commercial banks, along with a German bank, sold good amounts of euro/dollar. These sales permeated options-related bids just above $0.8800 and hurt speculative accounts, which have tried in vain to pick the bottom of the wobbly currency. Corporate accounts also suffered when they have been squeezed unceremoniously out of their long positions they had opened under the advice of some investment banks. "If anything, there still are some medium-term long euro positions in Europe," noted a senior trader. Such positions could further enhance the downside risk in euro/dollar in the event of a further decline. Traders are now eyeing $0.8565, which is the target of bearish pattern formed since July 26. (Story .880) >>
The CAC 40 index has risen from 1700 to 7000 from 1996 to 2000; a "4 bagger" in 4 years"... we've seen what the NAZ has done, we now see record PE multiples in the DOW into a slowing economy that faces near impossible earnings comps and we saw what happened to JAPAN's NEKKEI; yet - buying Gold stocks at historic lows & viewing present overall market valuations as "bubblistic" is alarmist,or extremeist, or you are simply a "Gold Bug".... why doesn't anyone simply view gold stocks as "value plays" with traditional & historic flight to safety upside momenteum ?
The unsustainable gold carry trade short derivative positions is another "LTC" crisis event waiting to happen - that's just the icing imo.
I'm slowly raising stops up behind my Oil Stocks - letting them continue to run, but when I get stopped out - I'm continually taking the profits & rotating to Gold - Silver-Copper stocks on weakness & keeping sizeable cash and waiting to short the bubble via some index puts and will begin to then add to individual shorts soon thereafter.
History is about to teach yet another investing generation a lesson - bank on it. We are due for the hibernating Bear to awaken & he's not going to be in a good mood when he arrives... We've still got another substantial leg up in the Oilpatch; but tight trailing stops & a savy exit off the next leg - when we reach yet another euphoric sentiment high off of earnings will be prudent - because the Oils have never risen substantially into a bear market and that's where were heading imho... inflation will be undeniable come late Q2/Q3 2001 & Golds will have their day in the sun once again. Oil prices ARE inflationary and food and energy do matter ! - allways have, allways will... bank on it. |
