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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Zardoz who wrote (73313)	7/12/2001 11:20:41 AM
From: Ken Benes	Read Replies (3) \| Respond to of 116979

This adds something new to the market. With the central banks quietly purchasing gold when the price falls and selling with public declarations when the price rises, they can now create the illusion of persistent cb selling. They have joined Goldman and the other bullion bankers in keeping gold in a very tight trading range. Poor Richard may be waiting an awfully long time for the scheme to fall apart. Ken

To: Zardoz who wrote (73313)	7/12/2001 2:16:51 PM
From: marek_wojna	Respond to of 116979

<<Remember the good old days when XAU was 120+ and you could short it with out need to worry about covering?>> Hutch, there is plenty to short and the potential almost unlimited, just pick your day, name almost doesn't matter. 07/12 09:27 Nasdaq 100 Stocks Are More Expensive Than in 2000: Taking Stock By Josh P. Hamilton New York, July 12 (Bloomberg) -- The Nasdaq 100 Index has fallen 65 percent from its March 2000 record -- and shares of the largest computer-related companies are still more expensive than they were last year, when the technology mania was in full bloom. The stocks in the Nasdaq 100 -- such as Microsoft Corp. and Cisco Systems Inc. -- sell for an average of 68 times the expected earnings for the next 12 months, up from 45 times at the start of last year. What's happened, analysts say, is that profit forecasts have plunged for technology companies, and the stocks haven't dropped proportionately. The stocks also are more expensive relative to the rest of the market: The Nasdaq 100 stocks are three times as pricey as the companies in the Standard & Poor's 500 Index. At the start of last year, they cost only twice as much. ``That points out just how awful technology earnings are turning out to be,'' said Greg Smith, chief investment strategist at Prudential Securities Inc. ``When there is a recovery, these stocks won't necessarily benefit that much because they're still expensive.'' The companies in the S&P 500, the market benchmark used by most professional investors, sell for about 21 times expected profit for the next 12 months, based on profit estimates from Thomson Financial. That means that while investors are paying $68 for an expected $1 in profit for the average Nasdaq 100 stock, they're spending only $21 for $1 of earnings for S&P 500 stocks. Sell Now? Investors shouldn't buy large technology stocks that appear cheap only because they've fallen so much from their highs, said Smith, and they should take advantage of rallies to sell those they already own. ``A Cisco might get back to $20, but it isn't going to go back to $40, even when the recovery gets here, because people won't be prepared to pay that much for a long time,'' Smith said. Cisco shares closed yesterday at $16.70. They peaked last year at $80. At the start of 2000, the stocks in the Nasdaq 100 -- which consists of the 100 largest non-financial companies on the Nasdaq Stock Market -- sold for 45 times expected earnings, while the average S&P 500 P/E was 22. Many investors said technology companies deserved a higher valuation because their business would grow regardless of what happened in the rest of the economy. ``These companies on the Nasdaq 100 weren't supposed to be cyclical,'' Smith said. ``It's turning out that they're a lot more cyclical than anybody thought.'' As happened with the so-called Nifty Fifty stocks that were the rage in the early 1970s, and technology stocks in the early 1980s, it can take years for once-popular stocks to return to their peak valuations. Some never do, Smith said. One reason is the behavior of investors who got in when the stocks were riding high, and rode them down to a fraction of their original cost. As of August 2000, U.S. investors had $167 billion in technology mutual funds, Smith said, citing data from AMG Data Services. That shrank to $71 billion by March of this year. Only $3.5 billion of the decrease came from investors cashing out, he said. The rest was due to crashing stock prices. ``That tells you there are people out there who'll say, `Thank God I got some of my money back, I'm getting out,''' and sell on any rally, driving prices back down, Smith said. If nothing else, the protracted recovery is likely to prompt individual investors to broaden their portfolios, Smith said. ``Money's got to be diversified,'' he said. ``You can't have your 401(k) in 10 tech stocks and expect to be OK.''