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Strategies & Market Trends : Ride the Tiger with CD -- Ignore unavailable to you. Want to Upgrade?

To: Canuck Dave who wrote (201816)	7/30/2011 7:11:12 PM
From: Claude Cormier	Respond to of 312821

CD, The market we are going through right now is more or less the same as we went in the last secular bull market. If I remember well. Gold stocks first outperfrom, then underperform for years and finally explode, at least for the best group. I suspect something similar. At some point , they will get so cheap, that there will be no other way to go but up. In short, the parabolic move is still ahead of us. And what will help is that other equites will also do well. Of course I am assuming that the USA will continue to raise its debt limit and print to pay its bills.

To: Canuck Dave who wrote (201816)	8/1/2011 3:15:41 PM
From: Jaakko	1 Recommendation Read Replies (1) \| Respond to of 312821

"What's going to take to get gold stocks to unhook from other equities?" A lot of "gold money" has found its way into gold ETFs... Once it becomes common knowledge that some of them don't have physical gold to back them up, there will be an exodus out of ETFs into gold shares... (George Soros already made his move)... In the 1980 cycle, when the Fed raised interest rates to kill rampant inflation, gold shares performed well for many years as their costs (both capital and production costs) were contained and in many cases went down in nominal terms... gold came down too but there were profitable margins... Any move in the current environment that will render future inflation (not to talk about hyperinflation) unlikely, should be very good for gold shares given the current favorable gold price and profit margins... Fixing the US debt ceiling and staying away from additional QE are considered such moves by the market... Whether they can be maintained in the long run is another question...