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Non-Tech : Money Supply & The Federal Reserve -- Ignore unavailable to you. Want to Upgrade?

To: loantech who wrote (945)	8/17/2003 10:32:41 PM
From: glenn_a	Respond to of 1379

Hi Tom. Thanks. You raise a good point about the potential for an upcoming spike in the price of gold, and a corresponding spike in PM shares. This would fit into my perspective quite well. However, to my mind, the fallout once a deflationary bust occurs could be very harsh on speculative money presently flowing into PM juniors. That being said, CBD, CKG, CBR, SVL ... these are pretty decently value companies from my limited understanding of PM valuations. Speculative in the case of the latter 3, but very decently-valued speculations (which appears to be Claude Cormier's special genius). I will still look to be cutting back on such holdings over the next month, but will likely retain a core position somewhere around maybe 10-12% (CBD and CKG are my core PM holdings). Also, I have a core position in a TSE-traded integrated Forest plantation/wood products company called Sino Forest. It's had a very decent run of some 350% over the past year, but after something like 40 consecutive profitable quarters, it still trades at a current year P/E multiple of < 5 (so much for the "efficient market" hypothesis!). But I hope to be primarily in cash by the end of August. Re: mining stocks rising in a falling market ... it is possible, but very unlikely if there is a global deflationary bust. There is simply too many people that need to sell financial assets of all types to turn liquid, and a dearth of cash to speculate on financial assets. It "could" be different this time, but I really don't see how at this point. Being debt free and significantly in cash is definately the way to go IMO. With some core value holdings (REALLY core ... we're talking "deep", "deep" value) :) ), and a dose of physical bullion, I'd say that's about the best one can do. And of course, a compassionate and kind heart to assist those who are not so well prepared to weather the storm. :) Best wishes, Glenn