Gold: If not now -- when?
Buggers... it's time to buck up.
You are either in this thing, or you're not. There's
no middle ground here, because gold is at a crossroads.
You either believe in Greenspan, Bernanke, Hank Paulsen
and the U.S. Dollar... or, you believe in over 2,000 years
of history where Gold has endured every single storm that
man, God, and fiat central bankers have thrown at it....
or you don't.
Yes, I know... the U.S. Dollar has bounced. But,so did
Enron, WorldCom and Pets.com before they rolled over
and died.
But, there's a difference between Enron, WorldCom and
Pets.com and the U.S. Dollar.
Those running Enron, WorldCom and Pets.com didn't want
their shareprice to go down. But, those managing the U.S.
Dollar do.
-- It's called competitive devaluation.
-- It's called monetizing the debt.
-- It's called Fiat Banking
-- It's called a transfer of wealth.
It's part and parcel of U.S. Policy. Over 40% of S&P 500
earnings now come from abroad. And a weaker dollar is
keeping those earnings pumped up. One of the few bright
spots in the U.S. economy is exports and the overseas
earnings of U.S. multi-nationals.
You read tricky-Dick Cheney's comments in his interview
with Larry Kudlow... this administration talks a strong
dollar policy, but walks a competitive devaluation policy:
Message 24009107
"KUDLOW: "Are you worried that the dollar has fallen
too low? I mean, you can hardly get through a day in
the financial news without reading about the dollar
setting a new low. Does that bother you? I mean,
when I worked for President Reagan many years ago,
he used to say a great country needed a strong and
reliable currency. This dollar story bother you?"
V.P. CHENEY: "...we think that key is that it should
be allowed to adjust based on market forces out there
and that's exactly what's happening."
Well let's take a look at that "adjustment"
and those "market forces."
Here's what Bernanke & Paulsen's LIE Policy
(Liquidity + Intervention + Exports)
gets you....
........................................"A Transfer Of Wealth"
The question you need to ask yourself today is simply this:
-- Are you better off today in paper, or in gold?
-- Do you believe central bankers are reflating the global
economy, or reigning it in?
-- Do you believe that inflation is rising, or falling?
-- Do you believe the U.S. has a strong, or a weak dollar policy?
-- Do you believe that inflation is always and everywhere --
a monetary phenomenon?
-- Do you believe that the worlds central bankers are going
to create more, or less paper?
-- Do you believe the worlds demand for commodities are going
to rise, or going to fall?
-- Do you believe that the U.S. subprime credit crisis, housing
bust and derivatives debacle is getting better, or worse?
This isn't the first pullback in gold and gold stocks,
and it isn't the first bounce in the buck...and it won't
be the last.
Now I know it's difficult to sell and take profits when
everyone is painting visions of $2,000+ gold in your head,
and telling you to "hold tight" because we're going higher.
And I know it's difficult to lean into the strong winds of
a hard & fast correction and buy hand, over fist.
But you know...that's exactly what you have to do in this market.
You know you need to sell euphoria...and buy fear.
Yes, it's very, very difficult to do that, because it goes
against the very DNA of human behavior.
But, you must do exactly that, because if you don't...
you end up always "chasing the puck" and getting whipsawed
and shaken out during these continual intra-cycle corrections.
And don't even begin to give me that "buy and hold"
bull-hookey... because you don't buy it, and neither do I.
Yeah, I know commodity cycles can last a long time. But,
we're talking about a "270 Point HUI Index swing"
just since mid August of this year.
...how much of that is in your wallet?
280 HUI points is equal to the entire move of the last
6 years, and we just got it in the last 4 months.
You MUST trade to some extent in this market,
and in this sector.
Neither gold, or commodities have ever been
buy and hold sectors....and in today's world, volatility
is getting worse, not better.
Now if by chance, you took profits into the move through
HUI 400, 420 and 450...and if you banked those gains and
listened and bought puts... I think now is the time to
be taking the profits on those puts...and using "that"
money to reload and re-enter...right here -- right now.
You know in the financial world -- the enemy for the most
part, is always playing with "OPM" (Other Peoples Money).
And when you buy "insurance"... you MUST be willing to
let's those puts expire worthless...and for that "insurance"
to serve as just that -- insurance.
But, when that "insurance"...serves it's dual purpose --
making money on the way down... you can take some, or all
of that money (think of it as "TEM" (The Enemy's Money)
and you can start to re-enter with that money - virtually
risk free.
And from an emotional/DNA standpoint of trading...it
is so much easier, so stress-free, and so damn much FUN,
to do it this way...
Think of it as "Akkido Trading" -- using the markets
momentum against itself.
It is sooooooooo much easier to trade -- when you
are trading out in front of the market, in anticipation
of it...than it is to trade behind it and in reaction to it.
... you can chase the puck -- or, you can skate to
where it's going to be.
And that's what you need to be doing today -- skating
to where the puck is going to be.
And right now -- the puck is coming back to us...and
coming back to us cheap.
Cheap-- you ask?
Well here's a little roadmap to tell you whether gold stocks
are cheap, or not...and how they've performed at these levels
in the past....
I know, I know... past performance is no guarantee
of the future... but, it's the best we got. There's
no guarantee's in stocks... and there's always a
degree of a leap of faith when re-entering.
But, remember... we're now re-entering with "TEM" (The
Enemy's Money)... our very, very profitable insurance
money. Our -- "mad money"... the money we took
from them.
So whether this is the bottom, or whether we find
it at HUI 340... it's close enough, and cheap enough
to certainly begin re-deploying a chunk of our "TEM"
funds...and some of those 280 HUI Index points that
we just pocketed the majority of.
Gold stocks are on sale people... now will they be cheaper,
next week, or the week after that?
Maybe.
Maybe not.
But it's sure a nice feeling to be in a position to be
able to afford to be wrong with THEIR money.
Now go out there and put some of "THEIR" money to good
use...and have fun doing it!
Mo later,
S.O.T.B. |
