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Strategies & Market Trends : The Millennium Crash -- Ignore unavailable to you. Want to Upgrade?

To: Arik T.G. who wrote (5557)	5/22/2001 8:11:24 PM
From: tekgk	Read Replies (2) \| Respond to of 5676

I am surprised that anyone remembers me on this forum - It's been a while since I have read or posted. I thought about how to answer your question and decided that I really don't know if this particular gold rally is real or not. I have slowly been accumulating physical gold and high quality mines that don't engage in extensive forward sales strategies ever since the Washington agreement. My feeling is that sooner or later the Europeans will get the Russians and some Arab oil producers to accept Euros as payment, thus reducing the need for dollar reserves and Euro dollar deposits. As China continues to emerge as a competitor, for political and economic reasons they will accelerate their small program that sells dollars for Gold and Euros. Other nations looking at our balance of trade and current account deficits in light of dollar sales by Europeans and Asians will follow suite at some level. The almost certain down turn in the dollar will signal the true beginning of a gold bull market. Our largest state descending into third world status (not just my opinion it's the opinion of senior leadership in leading companies such as Duke energy) isn't helping matters much either. With the exception of passenger and military aircraft and some software, we don't make much of anything that anyone else in the world really wants or needs (except for dollars). In fact, one of our big exports these days is gold (about 75 tones annualized as I recall from the latest trade numbers). The risk of gold dropping much below the current money losing levels for the mining industry seems unlikely, especially in light of dumb hedging programs and central bank leased gold that cannot be repaid. Predicting exactly when this will happen is very difficult. As you may recall, I tend to be ahead of the pack. In fact, I publicly wrote about an end to the tech bubble a couple of years too early on this forum. So where do I put my money? I obviously missed the last leg up in tech, but I did manage to position myself for a nice ride in the energy sector (where there are still some great buys - companies with PE's of less than 6, lots of cash, operating margins north of 50%, growth rates in the triple digits and dividend payments on top of all this). This is where the good bets are in my mind - especially in the natural gas sector. I view this recent tech rally as total stupidity. In fact, as a result of my activities, I can name lots of techs that are looking for cash that they probably won't get and will consequently go belly-up in the next few months. Several of these walking dead companies are up 30-50% in the last month or so. B2B, EAI software vendors, telcos, Internuts and various wireless software vendors lead this pack. Why would anyone bet on money losers when there are big winners elsewhere? Gold is not as sure a bet as energy or falling tech, but with the dollar certain to drop in the next few years, I am willing to slowly accumulate gold at these depressed levels for what I believe will be a major payout when the world gets tired of trading real stuff for computer entries.