I’ve thought long and hard about this and have concluded that I need to eliminate yet another industry from my investment menu: precious metals. Perhaps it’s coincidence, or not, but ever since the gold/silver trade has withered away, Jakegint has been scarce. I do believe Jakegint was sent to this site from space aliens to promote the purchase of gold/silver, since that’s what aliens do, apparently. My sources have informed me that he and his clan have mined all they could and returned to their planet, which would explain his absence.
It’s time to let go of the idea that American inflation is something to protect against. We’ve seen the Fed’s balance sheet triple over the years, yet oil and everything else hasn’t budged.
I will be selling out of EXK today and moving on.
What is investable?
That’s the trillion dollar question of course. We can’t buy dollar stores, like Dollar General, since the poor people don’t have enough money to buy vending machine toys anymore. The only venue left for real, sustainable, investment is technology. Innovation will not be limited to our borders and wayward economy. If something is good, it will sell on a global scale.
Domestically, I like housing and construction materials, but would prefer to buy a dip rather than chase up here.
Banking analysts are banging their African drums, while dancing around in their dashikis, praising the fundamentals of Citibank. I must be in some sort of parallel universe where this is actually true. I cannot get myself to invest in banks. It doesn’t appeal to me.
Semiconductors have become a perverted joke. They are nothing more than trading vehicles with zero leverage and pricing power for the long term. Companies like AAPL squeeze them. Biotech is gambling, unless of course you know some Doctors who are participating in trials who can offer you free advice in the form of data. That data can be used to guesstimate if the FDA will grant approval for their prospective drugs.
Restaurant stocks? Should I buy DIN because fatties love panned cakes or SONC because they just expanded their menu? Frankly, the only fast food joints worth anything are PNRA and CMG. Maybe retail names have a future, considering the wealthy have an insatiable demand for luxury. I am sure KORS is a terrific long term hold.
Decisions need to be made. I haven’t figured out where I want to put money now, but I know where I want to divest– and that is, good sir, to sell the shares of EXK and write it off along with the grace and presence of Jakegint.
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dapper as fuck. gentleman as fuck. informative as fucking shit.
Drones. $AVAV. Buyout target. Targets ornery brown people in dingy 3rd world countries. What’s not to like.
There is a fallacy about Gold. It has more to do with negative real rates than inflation. People tend to think of the late ’70s but what about the early ’80s and 2000s when inflation was falling and gold rising. That’s because real rates were negative. There is a way to make consistent $$ from PM stocks and involves pair trading but is rather boring and not for gunslingers. As I have said before etfs like GLD have sucked out investor $$ from PM stocks.
In any event the HFTs run Wall Street and the idea is to try and avoid them IMO (which is why my daytrades tend to be boring- again contrary to “expert” opinion).
If you have an hour or so read this academic study re: HFTs and TradeBots and see who the winners and losers are.
http://conference.nber.org/confer//2012/MMf12/Baron_Brogaard_Kirilenko.pdf
Thank you, Caddy. PM’s are better correletated with the 10-year than with any other asset class, and they certainly exhibit a better correlation with it than with inflation.
http://finance.yahoo.com/echarts?s=TLT+Interactive#symbol=tlt;range=3m;compare=gld;indicator=bollinger+volume+stochasticslow+rsi;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;
The miners are, however, best when swing traded. They’re not exciting, and they tend to get crazy oversold. That said, I’ve traded HL options for >100% gains at least 5 times over the last 5 years.
Point well taken.
As for PM stocks, they are just trades as you said.
Long term, they are just dogs. HL was in the low 20s in the mid ’80s when the price of silver was 60% lower than today.
I own tens of thousands of shares of this mismanaged piece of shit. At a cost of above 9, I might add.
I learned the hard way how trade HL. It is NOT a long-term hold. Most mining companies are dillution experts. GoldCorp and Yamana are probably the only well-managed PM producer plays out there. The royalty companies have the best gig overall, IMHO.
I was thinking the exact same thoughts re: Jake last night. I was going to post something similar but didn’t. Here’s how it looks to me: the senator looked like a darn good stock picker in the precious metals when the sector was hot. When the sector turned cold so did his stock picking. Sorry to be harsh but that’s how I feel about it.
You all might want to short wheat now as I enter the third day of South Beach carbo deprivation diet – designed by bread Nazis, indeud.
At the rate we borrowing from China, 40% of their population will be wearing True Religion jeans in 3 years…TRLG
Are you saying 40% of Chinese people will become douche-bags?
ROFL!
Space aliens promote both precious metals and the Tea Party.
The miners will be substantially higher by summertime.
I’m going long the gas man: MGEE
Senator Cement Head is a charlatan? Say it aint so!
i understand the frustration, but EXk still has a very strong PPT corellation, that most is hard to argue against. i expected more from pms and silver especially.
jakegint has been quiet of late but he has generally been a very sensible sage over the last few years. not all of his picks are pms. most of his ideas make sense accross the whole spectrum of investing.
PANNED CAKES
It looks like google is about to make a move up
Fly, Too bad you sold out of RNF. It has done nothing buy go up since you sold. Over $44 now.
Almost lunchtime – I could go for a cheesed burger.
Hmm, this action seems vaguely familiar.
Jake is not the kind to dine and dash, like so many panned cake eaters in this comment section.
I can’t tell if your post is just an attempt to wake him from his blogging slumber or meant as a genuine insult. I’ll assume the former and let it be.
iBankCoin – now without cussed words®
$EXK selling bottoms is for losers.
Fly sells out again for a loss.
You sold tons of silver to what,
go chase rainbows, dorothy?
You’re Fired!
Jake Gint for President !!!
I beg your pardon sir, you must have me confused with someone else. I have never owned EXK.
You seem like an intelligent and resourceful person, so I’ll withhold giving you any advice for the time being.
The inflation thing is a pile of steaming turds. Always has been, always will be.
please explain
How about healthcare? Spending has started to tick up. Medical devices and equipment, physician & clinical services, and prescriptions. Some interesting things in food too- cattle prices at record highs, big planting season in the southern hemisphere, rice arbitrage in China/India/Vietnam.
Rev growth is predicted to be weak in Q1 2013 and eps are expected to increase. Perhaps business services will be more valuable as companies fight to increase the bottom line in a weak growth environment.
XLV etf (JNJ,MRK,PFE,UNH,etc.) – boring and just creeps up.
What’s not to like?
Fly,
Just play silver. Think about relative value. When Silver was over $50 per ounce in 1980! A new 3 bedroom house cost what? A new loaded Corvette was how much…..gallon of milk etc…… I could go on and on but at some point silver’s store of value will explode!
Banned
Buy big companies with decent dividends. Go to sleep and see you in 20 years. This market is bo-ring!
No reason to short unless you like losing.
But as far as a leg up… why? Companies have cash but they sure aren’t hiring up in droves.
Good question. I don’t know what 2013 is bringing. Glad to see it’s not crystal clear and I’m just dense as a rock.
P.S. – I liked wine drinking, creatine taking, coffee drinking.. swearing Fly the best. Those were good times.
Jake has a real job with real clients and I suspect the tax changes have required overtime on his part the last few months as well as the first few months of this year.
Maybe I’ll send him my resume to see if he wants to open a Central Florida office as I too would like a real job.
Need a good CPA? I’ll join your Central Florida office (not much worse than my commute to North Tampa).
In early ’80s I was approached by a Great Neck firm to open an office in Tampa and my wife and I initially looked at the Tampa Palms area when it was first established.
Decided not to do it. I can only imagine the traffic now around there and Dale Mabry and Fletcher (and North), etc.
Still go there (St. Pete) to see the Rays play every once in awhile.
I reside in downtown St. Pete now (Rays season tix a must), but work in Tampa. Tampa is still the asshole of America (no Detroit).
JakeGint will reappear when gold is north of 2k this year.
The price of bread is up huge.
regards
Chuck Bennett
Pharmaceutical companies with heavy exposure to emerging markets.