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

To: long-gone who wrote (88919)	8/19/2002 7:07:21 AM
From: Richnorth	Respond to of 116790

The U.S. dollar's value was being eroded further during the last two weeks when the Fed created between 80 to 90 billion of greenbacks out of thin air. (BTW, this amount is enough to buy up all the gold mines!) And stocks are still way overvalued despite their P/E ratios having declined to about 35. The majority of Investors/speculators have been ruined and a good number of mutual funds and pension funds have been decimated by the scams and shady dealings on Wall Street and short-selling insiders. Against this backdrop one cannot help wondering if there was ever any winning way available. It appears there is! And it does not merely involve putting all your money into gold directly or indirectly. One Michael B. O'Higgins provided a winning strategy for coming up on the plus side every time. His is what is generally known as the "rear-view mirror" strategy. According to him, you plunk your money into equities if and only if the earnings for stocks, on January 1st of each year, was higher than the 10-year U.S. Treasury plus 10 points. If this is so, then you decide whether to buy short-term or long-term bonds. If the PoG on January 1st this year was higher than the PoG on Januray 1st. in the preceding year then you buy short-term bonds. But, if the PoG on January 1st this year was lower than the PoG last year, you buy long-term bonds. This "rear-view mirror" strategy of O'Higgins has made tons of money for its practitioners during the 1980s and 1990s when stocks were way overvalued (in contrast to the period 1974-1980 when they were fairly valued.) According to Jay Taylor (see miningstocks.com), "$1,000 invested in 1972 and kept only in the Dow, would have grown to $32,303 by the end of 2001. But that same $1,000 if it were invested in the O'Higgins process would have grown to an astounding $415,302! ..........................................." It has often been said that gold have to die so the DOW (and Nasdaq) may survive. Be that as it may and in view of O'Higgins (not Henry but Mike), one would suppose that putting bonds and gold in one's portfolio is the way to go, eh?

To: long-gone who wrote (88919)	8/19/2002 7:56:46 AM
From: E. Charters	Respond to of 116790

My point is that all fundamental analysis is a sort of technical analysis, with reasons of causation. The TA guy says he does not know why, which is more honest, but he still likes the look of the trend. How are the two reasoners different? They are both in black magic land, because of the complexity of causation you can more more say that gold rises with a particular economic effect than it will rise if it is tilted head and shoulders in price. In economics there is no hammer-drives-the-nail cause of things. And no matter how observed how often is the analog of reaction-of-gold-price to an effect, political, econmomic, or other, it is still just a co-incidence without rational connection. It is no more firm a connection than head and shoulders with a right shoulder higher. So one is patterns in the "real world", and one is patterns in price? Which is more sane? I would say one is cousin of the other. And if you are going to sleep with cousins, you might as well not get picky about which cousin and sleep with them both. Fundmental analysis is just pig entrails while technical analysis is chicken guts. EC<:-}