We are looking at indicators with the same concerns. You were one of the few folks who really understood why I brought up base metals in late 2002 (much better leading economic indicator than precious metals, IMHO) I think we agree on the scenario, just different timeframes.
Siedman is right, the FRB doesn't get it and is behind the inlfation curve, which make me think it will take longer for the public to get it. Gold might continue to react negatively to news reports (like the last two), but eventually the same news will push gold up. The news will not change (higher sales, better economy, GDP growth, inflation) but the perception of it will eventually turn around.
I think gold is good for $750 in the cycle, probably peaking into 2007/8, so I remain long-term bullish, short-term cautious. |
