Oldtent Archives 2007 - 2008

…..and..i never said I dont want to hear it from you

I respect your work and your opinions….i have heard your side of the story..and Presently I disagree with your position….doesnt mean i dont want to hear it….

I just disagree…..thats what a discussion brings….different points …

….Stay with us Partner….Most of us here look forward to your posts…..Most of them are saved at Analysis Paradise….

As Far as Corrections due….we have had Lots of them already….and one just now too….and as the previous Midas Post details…they have all been followed by even greater moves….UP

….Good discussion tonite….keep it comming….e can have mutual respect with differing perspectives

As I said, my beef is with the stocks, not the GOLD.  FGC, you point out that gold has been going up and always has these reactions - very true, and I bet we may be there again….however, the PM Stocks are on a ratchet mechanism, each pull back they pull back more than they gained, and hence, that is why a lot of us are where we are…

I don’t like to trade, and that is why I have held on…I beleived in the FUNDAMENTALs, and the fundamentals were and still are screaming up up up…but it doesn’t happen….Every excellent bonanza grade one of my junior hits and announces, I know the stock will lose another 5-10% that day…predictable…everyone sees it….. so what do I have to make me think “this time is different” after 4 years of hell…..?  I’d much rather be in physical right now.  I have  very little.

Rambus is calling it like it is…..he has made some great calls…he isn’t being negative…heck I can see the charts…again they are totally counter to the fundamentals…fundamentals SHOULD rule, but don’t in this new world…..

Several times in the last year, I have looked at the charts and am sure that things are going bad and I should sell, but I didn’t because I am not a trader - a buy and holder— and so many people say don’t try and trade a bull market….I might have been happier if I did….

I get a little upset when I see the “buy and hold preachers” (hi ment!) come out every once and a while and post ” oh I took a little profit on this, and oh I sold this, picked up a little of that, made X% of this and sold….”  Doesn’t sound like buy and hold to me…..

As I have said before I am not whining, or blaming anyone but myself…I know several people in the same boat….we beleived in the fundamentals…and we were right !!!!!! the USD went down from 1.2 to .72 and gold went from $300 to $1000….in fact we sit down for coffee and talk and say “Wow- we had it bang on…we knew this would happen with gold and the dollar”…problem is we held paper stocks, and the wheels fell off the cart and we gained nothing…….

I like hearing ALL sides of the story and hope you keep providing your thoughts.  One of the things that the Tent does not have enough of is different points of view.  I like to hear them - makes me think and question my own thoughts — then I can make my own decision and do whatever.   We need MORE people who tell it like it is, not less. 

Bill:
Now I know what it feels like to be caned on my tusch. But in spite of all of the darkness and depression, I still hold that the final selling is here. I believe that this will prove to be the final flushing out of commodities before the historic infusion of liquidity takes hold. Here are some brief technical reasons for this thought. 1) Goldcorp has been down 14 out of the past 17 days. 2) The HUI, assuming it closes near or at its low today, will have closed at or near its low 15 out of the past 18 days. 3) The worst down gap has come on a Friday after selling down the entire week. This has occurred on all of the bottoms. 4) The ratio of gold to silver has broken through 54 and 55 today. 5) The stock market appears to be repeating the March 2003 pattern when it bottomed and then took off about two weeks ahead of the HUI. The HUI should be close behind. 6) We are coming right into the mid-August period when gold and the shares have tended to move up sharply. 6) Even though it appears as though the HUI has had its worst decline in this market, if you can peep at the 2007 decline you find that it is almost identical. Last year in less than one month the HUI declined from 372 to 284. That’s over 25%. 7) Finally, the ultimate signal. My wonderful wife said to “sell everything.” This command has been heard before but only come at major bottoms.

One thing. Given the enormous amount of public bearishness as I cited this week from the consumer survey over the weekend, I believe that this next move both in stocks and in the gold and silver shares will be different from anything we have had so far. I don’t know what this means, but I suspect the move could be very violent. Chuck

Then from Dave in Denver…

Let’s keep it all in perspective here
On the HUI index: we’ve corrected 35%% from the 514 top to today.

in 2002 we went from 141 top to 95 low close - 32.6% loss then back up to the 12.8.03 top of 253 - that’s 166% gain

that ‘03 top then farted down to 168 in May ‘05 - 33.6% loss

then we climbed up to the April ‘06 high of 380 - a 126% gain

then we dropped down to a low-close of 291.95 in 10.2.06 that’s a drop of 23%

from that low point we hit that 514 high in March ‘08 that’s 76% gain.

I ask you all:

Was it over when the Germans bombed Pearl Harbor? NO! (oops wrong movie, that’s “Animal House”)

is the financial collapse done? No it’s just getting started is the Fed solving the liquidity problem? No they haven’t even begun printing in earnest

is the dollar ready to rumble? maybe to the downside

I wish I had the capital to double my positions here and double my gold and silver holdings.

***

Then from yours truly…

This week was as bad as it gets … one of the worst debacles in the last 9 years. While our net worth diminished, nothing has changed from a big picture perspective. The reasons for gold and silver to blaze into new all-time highs have not changed one iota, only increased.

While gold broke the weekly trendline, it reveals strong support at 850, which held today:

Weekly gold
futures.tradingcharts.com/chart/GD/W

There has been no interruption of the uptrend in the monthly gold chart:

futures.tradingcharts.com/chart/GD/M

This was a grit your teeth week. But, so be it. This too shall pass. I am actually a happy camper because this week is behind us.

And finally, from James Mc…
Bill,
These daily market interventions are untenable. The past week smacks of new levels of desperation. The viciousness of this gold selloff is ample evidence of the grave danger to banking, and the dollar. Trillions of auction-rate securities have no bid. Trillions of mortgages are going bad. Trillions more in commercial debt, credit card debt, and auto industry debt are going sour. Once all the cesspools known as bundled securities are properly priced (as worthless) most pension funds will be insolvent. Without Fannie purchasing Alt-A or zero-down mortgages any longer housing will further collapse. With Ford, Chrysler, and eventually GM discontinuing auto leasing the auto industry will totally collapse. Hyperinflation and huge government bailouts are a lead pipe cinch.

Anybody misconstruing this selloff as some major trend reversal in the metals will be left in the dust by the time next year rolls around. Nadler and Gartman act like they’re doing some end zone dance, but they were benchwarmers on the winning drive from $260 to $1,030. They will also be on the sidelines for the entire move to $3,000 and beyond. Both are pathetic, and indicative of persons beholden to other people.

By the way, if physical silver was in short supply at $20 I can only imagine what $15 is doing to it. Get a good look at the silver RSI, it could be a long time before you see it in single digits again. Any dry powder is being deployed at deep, deep discounts.
James Mc

GATA BE IN IT TO WIN IT!

…..They Occasionally win a hand…but they definitely don’t Trump Fundamentals

….Trump this Bernie

goldtent.net/wp_gold/wp-content/uploads/2008/04/pog5.png

Sorry for hitting a raw nerve with you fully. If this is the start of a wave II correction then it is just getting started IMHO. How low and how long it last is anybodies guess. A market that goes from 35 to 520 is one hell of a move and to say it can’t have a good correction is naive. The HUI has had a near perfect bull market up until the March high and I was one of the biggest bulls around. When the market changes I have to change with it or I will become trapped like so many right now. Been there and done that. The leverage that worked so well to the upside is now working against the juniors on the downside. I don’t want any part of that reverse leverage. When the time is right I can be back in the juniors in a matter of minutes, no big deal, but to say I can’t sell and take a decent profit because you have to be if for the long term is just plain wrong.
Sorry to have offended you fgc but there are two sides to every story and the story for gold and the gold stocks is far from over. No man on earth can say with 100% accuracy where the gold stocks will be in 6 months or a year or 5 years. Now you see why I chose not to post much over the last 4 months or so. Nobody wants to here the other side of the story and thats fine, I can understand.
All the best to you fgc…Rambus

….Extraordinary Popular Delusions and the Madness of Crowds …

The question is, “Do you sell, NOW?” as the question about his portfolio just came up.  Secondarily, the question has to be “What is HIS orientation for investment?”  If he is not a trader and does not feel comfortable doing so, then telling him to trade is not an option.

Today, you have called the Bull Market in Gold into question, even comparing it to the long lost top in the Nasdaq.  IMO, the fundamentals say that is nuts………….and the fundamentals always rule in the end.  So, are you willing to tell him to completely sell out at this time?…………and to take the responsibility for him possibly getting out, then us having a rocket of a rally in the PM sector?…………because that is what you are doing, my friend.  How about if you tell him to sell out, now, and you are right for a few days, then the PM sector takes off?  What are the odds he will get back in?  Is that what a non-trader wants to do in an Historic Gold Bull market?

You’d better think about that for awhile because the head and shoulders that is forming might end up looking like so many others across the PM sector during this Bull that might end up eating crow.  You better think long and hard because you might just be gambling somebody’s retirement away.  Even if you were going to sell, would you wholesale sell everything right now after this drop?……………or would you use another exit strategy?

In a Bull market, one should always give the upside the benefit of the doubt, and more investors (not traders) have been ruined by not doing so than by any other way.  And, don’t say “well I told him to get back in” because investors have a much harder time doing that than traders do.  So, throw out the trader’s hat and step into HIS shoes.

Let me give you a hint.  Right now, the Dollar is seemingly pulling back from the LT downtrend line it is approaching, Gold is rallying from a very overbought position, Silver ditto, and oil ditto.  The Fed and Uncle Sammie have just announced that they are going to backstop Freddie and Fannie to the tune of 800 Billion that can only end up as more govy debt that will have to be Dollar printing.  And the US is simultaneously steaming toward Iran and playing energy mumbly peg with Russia.  The last time they did that, Russia hammered all of the Oligarchs that the West was dealing with.  Price inflation is a real nasty 13%, and the only sign of anything reversing is that the boyz from GS stepped up to carpet bomb as Sabre advised back at the top.   They had to bomb oil because they cannot raise rates, but traders cannot redefine a bull market. 

Personally, I’ll stick with Gold and Silver much higher this year before a very sharp correction………………………….GR.

….I am betting…that THEY..are not so powerful as to manufacture a long Slide down in PMs…I say they are in control for shorter and shorter periods as we go along….Maybe another couple days….maybe another couple weeks….maybe another couple months…..or even maybe only a couple hours more….but thats it..times UP Sheesh…We Test the Old 1980 all time Highs for a couple months..as we have already done…and everybody sees the End !…..I dont care what line Wall Street is spewing….they have said the same things at 300….350….400….500….650..750….and Now !….but there an awful lot of People in this World that want to save their wealth in Gold..and they dont give a damn what Wall Street says….

…and when I said Rambus was painting a negative picture…..i didnt mean to imply he was being negative for the sake of negativity….but he believes his work points in a negative direction….and he stands up and says so…..He is negative on the PM sector right now….and I am just giving my fundamental perspective …and Using Grins T A….to top it off…..

…Bottom Line..the Cretins are bluffing..and i think we should stand and call them !

If you look at Moggy’s chart of gold below you will see that we have either ended wave 5 or are very close to ending it. In either case it is clearly not the time to add to physical. If you have a longer term perspective - by that I mean a year or more of rough sledding won’t bother you - hold what you have. POG is going much higher over the longer term. Over the shorter term I would expect at least an equivalent down move to the HUI. If we have seen the low in the HUI it would be a .382 retracement. Gold gained $781 in the move (using Moggy’s chart). If we take .382 of that we get about $300. That takes us down to the low 700’s. I think that is the least that could be expected in terms of a retracement. There are all kinds of rules of thumb I could cite - but they are even gloomier over the time of the correction.

I believe strongly in the 8 year cycle for gold. That is shown at the bottom of the page. We had 5 years down and 3 years up during the long bear. Now that we are in a bull market, we can expect as a template 5 years up and 3 down. My count is not quite the same (I start wave 1 a bit later) but it doesn’t matter which is right - the result is the same. The low will be in 2009 - less likely but possibly early 2010. I would expect $2000 to be easily cleared in the wave that starts in 2009 and runs for 5 or 6 years. There should be 4 cycles of 8 years to this bull market taking us into the early 2030’s. If the latter part of the move goes parabolic, as I would expect, there is no way to guesstimate how high is high.

Gloomy? No.

I will respond to the other couple of comments in the morning. I think we will get a good bounce in the HUI - I would watch to see which of my pm stocks participate in that bounce and based on that I might do a little pruning selling the weaker. If my stocks were majors I would have no qualms about holding for the longer term. The issue is the juniors - some could go very low even farther than already. Also, there is the problem of will they come back when we start the next multi-year rally that takes us very high? Of course all that assumes I am right. But the charts have been screaming at us - the HUI in the Spring and Gold now.

aurum POG

Got your email and replied. Thanks. I am checking with the other party who expressed an interest in that item. I’ll let you know either way, as soon as I hear back.

the Fed keep trumping the fundamentals!

I do appreciate your thoughts and charting.     Just inserting a  little humour in a difficult to read situation thats all.  I’ll keep the day job, thanks, and try not to outsmart myself as I continue to try to interpret the myriad of fundamental and  technical  data mixed  with tricky market psychology.  Viva La Tent.

Winedoc

Didn’t you hear them ring the bell on July 13th?  That’s the day THEY decided that the world no longer needed to worry about INFLATION because China, Europe, Japan, India, Australia, etc. etc. were all slowing down - no need for all the commodities because no one would be growing.  AND they said NOW is the time to buy banks and brokerage stocks because we are not going to let anyone short them.  That’s the game we are playing until something happens to change that perception. 

Down is UP,  Up is Down,  East is West,  West is East,  Good is Bad,  Bad is Good!

I don’t think the PM Bull market is over - but we better hold right here - or we start making lower lows and that is not good in a Bull Market.  JMO of course and NO - I am not selling any of my physical and YES I did buy some PM calls last week for a bounce from our current oversold condition.

I don’t think Rambus is being negative - I think he is telling it like he sees it with his charts.  I guarantee that he will be one of the first to tell you when he sees things looking better for the PM’s.  Again, JMO!