Ork, I really don't have a formed opinion of how this all
plays out, although I lean toward the currency crisis
scenario:
Dollar sharply down, gold sharply up, interest rates up,
bonds down, stocks down, spreads blowing up.
Physical gold remains my main investment, which
I buy on dips (such as now), as it is an obvious hedge against
the dollar crisis. I don't sweat the declines - Ben's hilos
will take care of them over time. Gold is in a secular
Bull market with no end in sight, not yet anyway.
I do recognize, however, that gold can
go down for an extended period of time (I started buying
it in 1998, and through the move in 1999 and 2000). Gold
stocks are even more risky - buy them if you can stomach the
dramatic drops this market exhibits occasionally, causing
one to sell at exactly the wrong time.
All the liquidity the Fed injected has created enormous
distortions in the marketplace, and high leveraged positions.
If, or when, we have a crisis, some of these positions will
blow up, so I would expect a dramatic pick up in volativity
and lots of sharp moves, in either direction! |
