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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: SliderOnTheBlack who wrote (42266)	4/20/2005 7:07:41 PM
From: RRainman9999	Read Replies (2) \| Respond to of 206151

sliderontheback I know you are a GoldBug ..so you probably know that Gold & Crude are the cheapest commodities out there..so let's make it simple..the price of beer increased with almost 5000% in the past 30 years... If we look at Gold & Oil they both did nothing...in those years..Gold should be valued at $1000/OZ..Crude at $120 per barrel.. RR

To: SliderOnTheBlack who wrote (42266)	4/21/2005 12:38:34 AM
From: energyplay	Respond to of 206151

Richenbacher is the thinking man's Perma Bear ;-) I think his these is mostly correct, but he is off on enough details to really mess up the timming of the "collaspe" and how far it will need to go. By the way, Dr. R is also a moralist - he expects moral behavior to be rewarded economically, and the "immoral" to pay the consequences (instead of shifting the consequences to someone else, as most experienced and hypocritical people try to do) Let's pick off some items in his laundry list - "While consumption, residential building and government spending soared, unprecedented imbalances developed in the economy - record-low saving; a record-high trade deficit; a vertical surge of household indebtedness; anemic employment and income growth from wages and salaries; outsized government deficits; and protracted, unusual weakness in business fixed investment. 1) record low saving - The US saving rate of 0.5 % does not include capital gains on the income side. Canada's does, and runs about 2.5-3.0 % Lots of income in the US is in the form of capital gains. Also, many retirement accounts, and tax dodge "charitable foundations" are not counted. Actual rate is likely to be close to Canada's. 2) record high trade defict - this is distorted by tax avoidance - see Marc Chandlers Monday FT article for an articulate view. Maybe 20% of the "trade defict" is actually controlled by US entities. 3) verticle surge of household indebtedness - debt is growing for mortages, but shrinking for high interest credit cards. This cuts debt service, creates tax advantages. I think Ken Fischer (a pollyana Perma Bull) had a recent article on this. 4) outsized government deficts - the state governments, even California, are doing much better, and the economic recovery is reducing the projected rise in the Federal deficit I expect a counter argument along the lines of >>>This is like the man who jumped off the Empire State Building and noticed a strong updraft around the 60th floor...okay, there's a half second extra before the splat....so what ? A _partial_ disengagement from Iraq, now planned for next year, will help here. 5) Business fixed investment is lousy, except FDI in China...;-) Note that corporations are flush with cash, and more cash is being brought back from overseas under the "US Job Creation Act" *My take - The money being brought back will buy about a year to two, most likely around 18 months...which can be a long time. Long enough for oil prices to come down and help the economy...;-) I think we will get 1-2 mini-crashes, with about a 7% in the US Dollar, over the next 3 years. Maybe like the October 1987 crash, or about half that size. I hope to take what I can get, cover shorts soon, and don't press my bets. Bought puts on housing stocks today, to go with tech puts, CarMax, and AIG puts. On a marginal basis, I'm way net short. ***************** I'm sure Dr. R is a patient man, (patience is a virtue) and won't mind waiting another 10-15 months for the US collaspe...