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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers

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To: marcos who wrote (49055)	9/17/2007 3:59:10 PM
From: TH	Read Replies (1) of 78419

Hello Marcos, You may be correct about a cut already priced in, but as you say, they are like Oreos and the street just can't have one. I read all of Stan's posts. I like his perspective and how he frames his positions. I find I agree with him often. Yes, miners might sell-off. There is certainly a risk in holding, but risk is what makes us play this game. I have been saying forever (which means more than a year <g>) that POG MUST lead the HUI/XAU through their respective resistance. I agree with those that state that the miners usually lead, but with this one exception. And that is POG must lead through the major resistance points. My thinking is fairly simple. The Fed is going to have to cut sooner or later. This is not about Ben staking his tuff and proving he has a pair. Ben is much too smart to ignore the potential for game playing to set off a massive sell-off in general equities (not to mention an implosion on those <assets> behind the curtain). Ben has done his best and talked a good game. Tomorrow he will cut his 1/4 on the Fed Funds and probably more on the discount window. There will be blab about inflation, but most important will be the language that the Fed is set to respond to changing conditions, and with that the stage will be set for the next cut next month. This cut cycle might be a bit different from the last one. I think the game is to walk the Fed Funds down to 4, plus or minus a 1/4. There will be unspoken rules to reprice risk and not create the monster again. And maybe some of these cuts will reach the consumer and give them a little relief with their ARM resets. The game will be to make the street beg for every 1/4 point. What are the implications of not cutting rates, and allowing foreclosures to increase? Not to mention all the risk mispriced by mark to myth. Cheap money won't fix everything, but a little cheaper money might bring some stability and maybe prevent a meltdown. Ben is not stupid, and unlike Alan <BG>, I think Ben knows what is at stake. I'm staying long the miners and willing to suffer if they sell off. If they do, I don't think it will be for long. Good Trading TH

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