Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (24037)	1/4/2005 2:53:34 PM
From: ild	Read Replies (1) \| Respond to of 110194

trotsky (goose@gold and dollar) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved what you call an'ephemeral link' has been a reality since 1971. there has only been a single instance in which the inverse gold/dollar correlation has for a short time been severed,and that was in the final blow-off rally of the 70's gold mania. that could well happen again, a few years hence. until then, investors will continue to have to contend with realities as opposed to undocumented beliefs. Date: Tue Jan 04 2005 14:33 trotsky (rijjj) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved "is there a reason you prefer using tnx in the ratio versus tyx? " not really. doesn't make a lot of difference actually, since TNX and TYX tend to march in lockstep most of the time. Date: Tue Jan 04 2005 14:16 trotsky (goose) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved currency translations are certainly a contributing factor, especially in the case of the SA miners. but that doesn't explain the weakness in all those gold stocks that have NOT been hit by large currency moves on their cost base. the yield spread however does explain it. the positive correlation between the US yield curve and the pm stocks is as old as the negative correlation between gold and the dollar...and as immutable. Date: Tue Jan 04 2005 13:49 trotsky (and the real reason is....) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved the explanation for weak pm stock prices in the face of strong metals prices is this ratio: stockcharts.com[m,a]daclyyay[pb50!b200][vc60][iUb14!La12,26,9]&pref=G unless it increases, the sector won't come off the mat. in fact, if it fails to increase and PoG continues to turn down, things could take a turn for the worse. the good news is that it looks pretty oversold and ripe for a reversal. but that's a sine qua non condition.