what you saw in last few weeks was a monumental dumping on the gold futures market by the Gold Cartel
let's see if gold rebounds
also, Prechter completely overlooks the effectiveness of gold as a deflation hedge
in 1930-32 (or something like that) Homestake rose several hundred percent
I think it was 800%
we saw the conclusion of the first bull leg
I am delighted you doubt the bull run
as TanRange CEO Sinclair said two weeks ago
"the early stages of this longterm gold runup is being doubted by bulls and bears alike"
we need doubt to allow further rise
did anyone expect gold to bounce from #298 last week to #315 today ???
Japanese investors proved from Nov2001 to May2002 that gold is indeed a very effective deflation hedge
they bought the metal with both fists
and they managed to sidestep some large losses in both the cash savings market and the stock market
metal prevailed over paper
AND IT WILL AGAIN AND AGAIN
I love these deflation stories
they are so amusing, while at the same time incorrect
first, the US economy will not suffer lengthy deflation
to have sustained deflation, one must have:
- rising dollar
- declining gold
- declining CRB commodity index
- an inverted bond yield curve
check the above
ALL ARE THE OPPOSITE OF WHAT IS NECESSARY FOR DEFLATION
you are in part buying into the message promulgated by the Gold Cartel that gold is dead
not so, and you will see in the coming months
as the dollar continues down, gold resumes its rise, the CRB laps up monetary expansion (not stocks), and the yield curve becomes even more sharply inclined
the Fed is working overtime to inflate, not deflate
gold is the world greatest hedge against extreme disruption to the paper asset game
whether inflation or deflation
since last autumn, why did the gold index XAU and HUI outperform every single sector?
the US economy saw a substantial deflation episode
in bankruptcies, in stock prices, in CPI, in PPI
so I conclude gold is a great deflation hedge empirically
I DONT NEED DECEPTIVE CRIMINAL WALL STREET INSTITUTIONS TO LEAD ME BY THE NOSE AND INSTRUCT ME AS TO GOLD'S POWER
soon it will be verified as a great deflation hedge
/ jim |
