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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (45402)	1/31/2004 1:25:40 PM
From: EL KABONG!!!	Read Replies (1) \| Respond to of 74559

cbs.marketwatch.com{7F72190A-839B-43DB-987C-913E24037260}&siteid=mktw&dist=&archive=true PETER BRIMELOW Gold veterans brace for rough ride By Peter Brimelow, CBS.MarketWatch.com Last Update: 1:07 AM ET Jan. 26, 2004 NEW YORK (CBS.MW) -- Gold is under the gun, down to $406 in early trading in Asia this morning, but the gold bugs remain calm. Indeed, they've been grimly calm at key points throughout gold's three-year rise, both when it has been on the upswing and during its periodic reversals. Several long-term gold bulls have been warning that bullion, and even more so the stocks, are overbought short-tem. "This is the correction I've been talking about," wrote Dow Theory Letters' Richard Russell this weekend. He added: "It's been offset by the upside correction in the dollar. The gold bull market is taking a rest as gold and gold shares continue to move into stronger hands." Reflecting this caution, the Hulbert Gold Newsletter Sentiment Index [HGNSI], measuring gold exposure among the letters monitored by the Hulbert Financial Digest, is down to 7.69 percent as of Friday night. As recently as early December, it was 65.4 percent -- and that was before gold got through $400. Gold has been climbing a wall of worry. And that has resulted in more worry. However, in contrast to the gold timers overall, the gold geezers -- my name for the gold timers who were around during the last gold blow-off in 1980 -- are exactly where they were when I last looked (See Nov. 24 column). All are long-term bullish except Elliott Wave guru Bob Prechter. Precisely what the most grizzled gold bugs mean by long-term (and just why less hardened investors might worried) was made clear by the International Harry Schultz Letter's Harry Schultz in a recent powerful talk to a conference in Munich, Germany. Schultz noted that he's been trading gold since he lived in Shanghai in 1945-6. ("That's 57 years of gold trading!") Schultz ringingly reaffirmed his faith in the new gold bull market: "Exactly how high the gold price will go is obviously uncertain but surely it will be $500 or 600 or 700 or perhaps much more, over the next few years." There is, however, a catch -- a big catch. Schultz warned, in his idiosyncratic Schultzspeak: "But... corrections in the gold mkt are always vicious. I am a veteran of the 1970's gold mkt & they called me a gold guru then. We saw a 50% correction in bullion in the middle of that gold bull mkt, from approximately $400 to aprox $200, which meant that due to leverage in the shares, the shares fell 70% or 80% or even 90%." Arrgh. And, just in case anyone missed the point, Shultz rammed it home: "U can be sure that there will be another 50% gold correction with an 80% drop in share prices." Aaargh again! This obviously goes far beyond the normal definition of a bull market correction. All that can be said in its favor is that it worked before. Is it happening again? Schultz hasn't quite said that, although he was one of the letters warning of an imminent correction. Schultz's suggested strategy: hold a core portfolio of gold bullion or coins and trade the shares. Buy low, sell high. That sort of thing. Unfortunately, Mark Hulbert's monitoring of Schultz provides no definite proof that he can really trade this volatile market successfully. He has made striking calls: He did bale out of gold after it peaked in 1980, but is often too obscure to permit the construction of a model portfolio. In contrast, Dow Theory Letters' Richard Russell, very similar in background, experience and gold buggishness, eschews trading and advocates buying and holding gold shares. For anyone inclined to agree, these mutual funds are recommended by the gold timers (number in brackets) that have beaten the Wilshire 500 over the past five years: The third column indicatesis the number of newsletters recommending the fund. Fidelity Select Gold......FSAGX...5 Amer. Cent. Global Gold...BGEIX...5 Rydex Precious Metals.....RYPMX...3 Tocqueville Gold..........TGLDX...4 KJC

To: TobagoJack who wrote (45402)	2/2/2004 3:50:38 AM
From: que seria	Read Replies (1) \| Respond to of 74559

Jay: California bankruptcy will be excused on basis that it can't print its money, and is unfairly dependent upon its citizens' willingness to tax themselves for the "benefits" their rulers enact. This will inhibit other states, but not the feds. I am wondering how California would fare through a similar episode ;0) They who have perpetual wars to fight, Mars to go, SUVs to tank, and missile defenses to dream up. Social programs and officious government employees are California's own blood-sucking version of a military budget. In any event California, having already applied its "personal" property tax to California corporations for satellites they own in Earth orbit, will also get its piece of lucre from Mars.