Loading ...march 8th
As I approach the keyboard this afternoon, it should be noted that I always review the last three or four prior emails in order to a) follow through on a previous theme; b) avoid embarrassing myself by writing something that appears disingenuous; and/or c) avoid any attempt to wriggle out from the inevitable reality that my recent predictions on the price of gold and the Senior and Junior Canadian miners have been DEAD wrong. To simplify, the prices have not gone UP; they have gone DOWN. Ergo, I have made an egregiously bad call, thinking for even as briefly as a nanosecond that the Interventionalists would take their hobnailed boot off the throats of the precious metals. Sure, I took the trades off above $1,300 when the Commercial Criminals decided to cap the rally but the re-entry point around $1,250? Wrong, wrong, and wrong.
Now, in recent times (April 2009 until now), the traditional signals for adopting a bullish stance have not exactly worked all that well but in the past six months, I have noticed that it has gone from the ridiculous to the sublime, as in no matter what the headline is, the algorithmic amoebae are now 100% programmed to slam the prices of precious metals. Bad economic data? Sell gold! Good economic data? Sell gold! Bad BLS numbers? Sell gold! Good BLS numbers? Sell gold! However, the counterparty to that trade has been the strength in the USD which began its recent parabolic advance in July of 2014 and coincided to the day with the crash in crude oil. And since every money manager in the non-U.S. arena is piling into the USD in order to “outperform” versus their local currencies, it might be said that the most irrational over-exuberance of the past six years is not biotech or social media but rather the unanimous collective opinion that the U.S. is the safest haven on the planet. Having printed $18 trillion in debt, there had better be one hell of an economic recovery in order for tax revenues to retire/reduce such an elephantine amount. But as they say, it is what it is…