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Gold/Mining/Energy : At a bottom now for gold? -- Ignore unavailable to you. Want to Upgrade?

To: Vieserre who wrote (1453)	7/17/1998 1:37:00 AM
From: ahhaha	Read Replies (2) \| Respond to of 1911

I totally agree. The rotation is occurring as we speak. Various companies have hit their highs and are headed South. The first general topping occurred in July '97. Then Oct '97, Apr '98. and now. There are the big banks and airlines that have yet to reach a peak. That shouldn't occur until 1999. The cyclicals and resource stocks will be the last to advance. By that time we should be in stagflation and a general bear market. The bear will start off slow. Too much upside momentum to drop fast. It could take 2 more years before the public knows there's trouble afoot. This assumes no exogenous forces come in to play. Why do I use the word stagflation? The FED will tighten when the dollar charade is over. But the problem will be that unemployment will start rising rapidly so the FED will have to back off the brake. Jordan, Poole, Moskow, Rivlin, and others on the board keep asserting that they are watching and just waiting to jump on any sign of inflation. That's easy to do when there is no suffering caused or when the public is so mentally trained to expect that they could lose their jobs quickly as seen throughout the last 15 years. But that environment is all gone. Now it ain't so easy. The proof is strikes. Virulent ones. The public feels wealthy, strong, and tough. The FED has painted themselves into a corner where it's hard to have to break that attitude of labor hubris. They have been retrained by the intervening years to think its easy to do. It was easy, up to six months ago. Too late now. They will tighten and then ease before the hubris is broken because they will freak over rising unemployment. The easing aspect generates the stagflation. That answers your hypothesis that gold can't rise because of the inflation fighting determination of FED officials. Their determination will be co-opted by their first duty as enunciated in Humphrey-Hawkins, the welfare of the people. If that means a little inflation, so be it. Greenspan has already said as much. You can't make a deal with the devil and he's doing it. The great man of rigor, Greenspan, has been converted. No big deal. Has happened to just about every Chairman. They see the light of the higher calling. The truth they see is that a little more money won't hurt anyone, especially since by law they can't put anyone in hardship.