<<<(Did you see the rise in gold stocks - also copper and aluminum have down well lately; somebody smells inflation)>>>
tell me about it. I'm one of those individuals. (ggg) Moved 1/4 of my portfolio into blue chip gold mining stocks.
thanks for all the opinions (more needed):
Here's how I see it..... We selloff in the gen mkt as 4 things converge: 1. earnings like it or not are slowing and yet valuations are sky high 2. internet and specualtive fever reach a nirvanic peak 3. the bond gets up over 6% 4. dollar gets wacked. That's just what gets it rolling. The fed raises rates in May and rocks the mkt again. We end up back around 7500 by mid summer and base until we start running up again to form the rt shoulder of a huge H & S pattern that spans 2 yrs w/ last yrs peak being the left shoulder and now being the head. Oct will see the peak of the rt shoulder and a breach of the neckline, and it is game over for the bull as commodities become the place to be again and interest rates begin rising dramatically as inflation , rumored to be dead, is alive and kicking a in a very foul mood. (basically a return to the 70's.. no bell bottoms rq'd )
Of course, all of this is PURE speculation, but that's how I see things going dwn. Now, how will the drillers fair? Again, I think you return to the 70's. The oil industry was on fire throughout the 70's and I think the smae will be the case for the drillers. I think this inflation that I am refering to will come from food prices (El nino), energy (gas especially but also oil..for previously discussed reasons), wages, and asset inflation. One only has to glance at the XAU and see that the shoe is getting ready to fall. Since one of the major drivers of inflation will probably be oil, the drillers should fair well. The drillers should diverge from the broader mkt when it corrects (look at last yr.. much the same thing happened, as the SPX and DOW peaked while OSX launched from its correction.) Oct will probably be time for the exit, but the drillers will rise again in the spring. And that's how I see it, but like I said this is all pure speculation. Usually when you think something will happen and ares tupid enough to write it dwn it never does. So never fear! BUY KTEL!!!!!!!!!!
-Lucretius |
