Naw, it’s not that bad, yet, but Detroit is getting there. Let’s see what a couple of years of a U.A.W. -driven Chrysler do to it.
But let’s put all that aside and talk about the invisibility of this gold bull, shall we? I mean, my astute buddies over in the estimable PPT — that Powerful Profit Taj– (have you signed up yet??)… even those gentlemen seem to be walking around that trading room like zombies in the Night of the Living Dead, completely oblivious to the blooming precious metal bull that is erupting around them.
Why, just today, one of our estimable patrons sold our featured “pocket rocket” junior miner (see below) as if it were one of CA’s 30 second Viagra Vehicles. Let me tell you, I was aghast! Mortified!
But let me assure you, Jacksonians, this odd behaviour (sic) only inures to our collective benefit. The longer the general public (and let me make clear that the PPT community is NOT the “General Public,” they are at least “English Beat” or barring that “Fine Young Cannibals”– ) remains ignorant of the stealth bull in the precious metal miners, the better it is for our accumulation purposes.
For, my friends (come, gather close so I may whisper it to you) — we shall be as the most miserable pinch penny miser on Ebenezer Scrooge’s third shift staff, sparingly sifting our gold and silver specie into dark musty lock boxes while others pass the punch with knowing glee and manly aplomb. Let them have their japes and their ales and their merry tunes played upon a three stringed fiddle, for we shall act quietly here below, rebuilding the foundation of a hackneyed and eroding financial system for our children and their’s. It is weary work, but God smiles upon us, and there shall be reward.
That said, I dont’ have much time to dwell on the blindness of the common man, so let’s take a quick look at what they’re missing.
Remember this chart of the AMEX Gold Bugs Index from a week or so back?
Pretty nice looking chart, no? Maybe some of you got long after looking at it? Maybe some of you ran out and bought some gold stocks the next day, too. (Heh)
Let’s see if that was the smart thing to do, from the perspective of a week later:
Well peel me naked and slather me with mornay sauce, whaddaya know? A breakout just like we expected. And look at all that free air we’ve got to go. Hmmmm… and what was in that Index again? Oh yeah, a lot of juicy big cap gold and silver stocks.
Think maybe that break into the free zone will have some effect on our junior miners? Heck, let’s see:
This is your golden burrito for tomorrow and for the summer, my friends. We shall share recipes for further tasty treats as time allows, but for now, know that outside the Jacksonian Core*, I am also purchasing and/or considering the purchase of the following precious metal mining hardies: [[GG]], [[EGO]], [[AUY]], [[EXK]], [[NGD]], [[NXG]], [[NG]] and of course [[AGQ]].
Keep in mind also, that there was a pretty bearish candle on the TLT today, boys and girls. If that bond group and the Ten-Year Starting breaking down, it’ll likely be sayonora for the large part of this market. Except maybe one part.
Caveat: If you follow me into the purchase of any of the above named precious metal plays, your children will be stolen by Hobgoblins and traded to dwarves for shiny strips of tin foil and moldy bacon.
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ANDE — $22.20 (-2.42%)
GDX — $41.24 (+1.90%)
GLD — $93.85 (+1.73)
IAG – $10.23 (+0..69%)
PAAS — $21.19 (+0.95%)
RGLD – $44.90 (+4.98%)
SLV — $14.34 (+1.69%)
SLW — $9.41 (-0.53%)
SSRI — $22.17 (+0.77%)
TBT — $52.43 (+4.96%)
TC — $8.46 (-7.44%)
TSO — $16.53 (-4.40%)
Daily Average: –0.25%
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UPDATE: I sold the calls on TBT again, here @ $53.58. I think TBT is a bit parabolic here, and TLT looks like it’s ready to bounce.
See caveats above.
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I may be wrong, but of the gold plays, I think I like NGD over NG and NXG (which seem to be good plays too). For example, NXG is almost at it’s 52 week high, while NGD has a lot more room to run til it reaches such a resistance point.
Also Jake, really like the charts from a week ago predicting break out and showing what happened. I rarely, ok just about never, check out charts that predicted breakout compared to what actually happened if I wasn’t in the stock.
Thanks Jake!
I’d buy that for a dollar!
Bluth — you’re welcome, just keep it on the down low, okay?
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Anton, highly underrated movie. Some great 80’s “railies” scenes too.
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For, my friends (come, gather close so I may whisper it to you) — we shall be as the most miserable pinch penny miser on Ebenezer Scrooge’s third shift staff, sparingly sifting our gold and silver specie into dark musty lock boxes while others pass the punch with knowing glee and manly aplomb. Let them have their japes and their ales and their merry tunes played upon a three stringed fiddle, for we shall act quietly here below, rebuilding the foundation of a hackneyed and eroding financial system for our children and their’s. It is weary work, but God smiles upon us, and there shall be reward.
That has to be one of the best paragraphs you’ve written yet.
^^^^
So true. Paul Verhoeven’s zenith.
(“Showgirls,” being his nadir, groundbreakingly artistic girl-girl stuff aside.)
I picked up some DGP and EGO today, btw. Had some other gold and miners earlier this year, but a tight stop sent them back to the Earth.
Will spend some quality time studying the Jacksonian Core this weekend.
Huzzahs, Sir.
Sanity (i.e., that which comports with my view of the way things should work) reared its head today. Finally, both treasuries and the market went down big. Before today, TBT’s rise and falling treasury prices were tightly bound to the market’ rise and optimism about economic growth.
For today at least, the market glimpsed the dark side of spending, easing and bailing, courtesy of a discredited credit rater.
I don’t know if I can even buy the gold equities if the 10 keeps going the way it is. I think I would take GLD but would rather stick to energy liquids/gasses.
chivas was dead on with his comments and I watched mortgage rates add another 2 ticks overnight. If we walk them up to 525+, well lets just say we could be staring 800-820 /ES in the face again within a week. With bonds getting smoked I would think convert shops would start hammering equities to pull up the slack. Honestly from what I know I don’t think many of these shops unwound their basis trades that got them in trouble earlier. What happens if there are more basis forced unwinds to come.
Random thought random post: Who the fuck thinks its cool to buy a minivan like the Honda commercial says. I mean snatch and rape vans rocked because of the mystery that is behind those windowless rear cabins, but a fucking mini-van give me a break.
^^^LOL, Gappy.
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PS – Chivas thinks the PM’s are a good place to be if the 10 is in trouble.
I tend to trust his judgment.
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Gap,
spot on regarding convert shops. i’m hearing the same thing.
$HL looks great!
Jake,
I had already taken positions in TBT and SLV before you started writing about the Jacksonians. Since your posts, I’ve researched and added four more of the Core (mostly silver and TC); but I’ve been watching your entire list with great interest. They’ve held up well this week. Keep up the great posts. And love the shout out to the Fine Young Cannibals; haven’t listened to them forever. Gonna have to download a few of their singles for my ipod.
Jake,
that’s right. regarding the pm.
even though i am short, i really hope this dollar holds. if it unravels, God help us.
I think we bounce at 80, C. The fibs, everything are aligning.
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Forgot to add ANV to the above juniors… I’ve owned a ton of it forever.
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AUY? What the heck Gintster. You missed that one and it ROCKS! I demand an update. 🙂
Anv breaking decided against buying it cuz resistance real close to it. if breaks might buy. The dollar and gold dont always correlate. Long term they are suppose to but there have been trends where this no correlation. just look back in time. Sure Jake will post showing this at some point
At the risk of giving you a trulu Homerian case of hubris, I will add to the kudos contained in the previous few posts. Since the “tabbed” status achievement, you have given nothing short of yeomen’s effort. Kinda like I was raised in the olden days: “If You’re gonna do something, do it right.” Jake the Younger, I say to you now in all sincerity and with well deserved respect, “Well done, Sir Jake.”
Note: “posts” should read “previous few threads” (Ithink).
Warning, complete newbie question here so be kind.
Because of the way the fed seems to be devaluing the dollar, I have been interested in Gold as a hedge against inflation. I have been in cash for about a year. A friend tipped me off to the Fly Blog and then I followed the blogger contest as you won which was a good thing for me because I am not a trader, I am typically a buy and holder or even (gasp) a person who buys mutual funds.
I have started to accumulate some of the Silver mining stocks in your Jacksonian list, mainly because you blogged that silver is a more of a bargain than gold if you look at the historical silver to gold ratios. These stocks seem to be a little bit more stable than some of the other sectors but they still fluctuate quite a bit with the stock market. Can you explain to a newbie the difference between owning stock in a Silver mine, for example, and owning a chunk of silver.
Thanks for your efforts.
Blitz:
I will just make a couple of general comments on commodity vs the mine.
Mines carry the risk of extracting the commodity, sometimes is buried in a way thats not easy to extract and less attractive.
A mine carries the risk of being seized, Hugo Chavez comes to mind.
A mine holding may be subject to regulations that cause the value to be less, take protected areas for instance that decrease profit.
The mine could be sold for even more profit to another company.
The straight commodity does not carry this risk or variable but does come with increased spot price volatility.
These are just a few, there are bound to be a lot more but its a start.
most gold silver stocks have another 5-10% before they consolidate. will most likely consolidate and pullback sometime next week.
Silver stock is affected by companies fundamentals while silver itself is affected based on inflation and its use. By the way Silver will be $40+ an ounce at some point but that is out in the future. I am adding these gold/silver picks over the next two + weeks along with some more FAZ and shorts as I see fit.
my capital is pretty much maxed by the way
Bluth Company Says:
“I may be wrong, but of the gold plays, I think I like NGD over NG and NXG (which seem to be good plays too). For example, NXG is almost at it’s 52 week high, while NGD has a lot more room to run til it reaches such a resistance point.
Also Jake, really like the charts from a week ago predicting break out and showing what happened. I rarely, ok just about never, check out charts that predicted breakout compared to what actually happened if I wasn’t in the stock.
Thanks Jake!”
May 21st, 2009 at 9:06 pm Vote: 1 0
Goin’Fawr Says:
“My error, RE: “NG:sell”. That should read “I’ve sold my NG”. You please yourselves…”
May 20th, 2009 at 12:05 pm
(Note the time and date)
We’re way ahead of you on that one, sir.
Hi Jake,
I’ll be buying PAAS and NGD on a pullback to add to my PM miners.
Agree with your view but waiting for a better entry.
Hey gappingandyapping
Thanks for taking it easy on a newbie and a very informative post.
Tell me, are there ways to invest through the stock market in companies that buy raw materials like Silver, or is buying stock in a company that mines silver as close as you can get.
Am I asking a question that delves into the black arts of commodities trading?
Gappy got it right. A miner is an operating company that sells silver from mined reserves. In that way it is ultimately “leveraged” via those operations by the efficiency of its mining. The lower its cost per ounce to mine, the better the returns on capital invested. That’s why miners are great when the price of silver is going up and hell when energy prices are rising faster. I buy the underlying metal for currency stability, and the miners to take advantage of what I believe will be an accelerating price paradigm.
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There are also royalty companies that finance miners in exchange for a percentage of their production. RGLD is the best of these, and I insist you all have it in your portfolio if you are going to be any way associated with this sector.
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We will have a slight pullback in these soon. but you will get in same price you can today pretty much instead of a week and a half or so later
Thanks Jake
Might it be time to start looking at the explorers, juniors, and crappily managed metal companies? You know – GSS, CDE, RBY, CS, TRE etc?
Beauty post JG!! Love that NGD, here’s hoping it follows up yesterday’s breakout with another big day!
Good Jackson link
http://www.usdebtclock.org/
You still holding that mongrel of a stock, ABK?
I foolishly never unloaded when it hit $2…
Smiling ear to ear over here.
You still holding that mongrel of a stock, ABK?
Bailed last week.
You gotta watch these 30-second Viagra plays.
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Update on NGD: It’s just about hit the February highs (2.55 on the chart) before dropping back. Again, not unusual, as that last high is going to offer a modicum of resistance.
I expect there may be an entry here along the rising trend line. That’s not to say you’ll get it, but if I see it, I will be doubling my position in the mid 2.20’s.
Again, if you follow my recs blindly, I’ll kill you, and then send Fly’s “people” over to your house to make certain your body will never be found.
You and Jimmy Hoffa, twin mysteries.
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started to build a small position in NGD @2.42
Oh yeah one more thing. Remember, the journey to inflation protect a portfolio begins with a single step.
ATTENTION JACKSONIANS: If you have not yet hedged out your TBT (+$1.15 @ $53.58. 1:17 PM), I believe now is the time to sell the calls.
I am doing so again.
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Note Update above….
UPDATE: I sold the calls on TBT again, here @ $53.58. I think TBT is a bit parabolic here, and TLT looks like it’s ready to bounce.
See caveats above.
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Special shout out to Henry on OXGN (and many more)!
No “fool” he!
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RE: “Update on NGD: It’s just about hit the February highs (2.55 on the chart) before dropping back. Again, not unusual, as that last high is going to offer a modicum of resistance.”
Jake, you don’t think that their combination with WGW.amex alters NGD’s playing field?
I really enjoy reading this blog. Too bad I had not paid CLOSER attention earlier. You seem to be on the right path with the Jacksonian Core Holdings.
Hey jake, you’re going to love this report. I went over to my PM dealer today, it was empty. They sold everything last summer. I’m talking a place that was loaded to the gills with gold and silver, they have a vault bigger than my bank. It was spooky. She gave me $1 over spot for my silver and said if I wanted to buy at some point in the future everything is special order with a premium spread. Eerie man, I thought they were out of business. Be careful if you’re short gold or silver people, I ain’t lying.
Dubz — Plenty of time to get into the core. Might even be some pullback here next week.
The PM’s especially have a long way to go.
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Scum — I am hearing those stories all over.
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think it is safe to say that my IAG was a killer play today. expecting pullback to little up move next week for gold/silver. will enter more on friday
“my” IAG?
.
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LOL.
his IAG?
Josh’s IAG?!
My IAG bitchez!
My IAG. as in i own a position. http://tacharts101.blogspot.com/2009/05/only-more-doom.html
said it was my pick for tomorrow. on my blog. i expect a pullback and consolidation
it is one that i will add to. as my shorts begin to turn into profits
Blitz: I assume you are talking about a reseller of silver. I am sure there are some out there, I don’t know the silver space enough to tell you but I really don’t like to play it that way in volatile price increasing times due to their hedging strategies that will lose money, if prices were decreasing then it would be the other way around. I personally, and this is just me not a broad opinion that I know of, but I like to just buy the commodity itself through either futures contracts or through the SLV etf or if you like gold GLD and I sometimes play GSS. I am more an energy player than metals, in that space I am in love with NatGas at this moment via UNG and I also like oil via DXO, I am long DXO from $2.27 and have been right sizing my position here at $3.75. I want to buy more DXO but only on pullbacks and I am actively bidding/buying UNG right here, I bought 400 shares of UNG today and 1600 yesterday around $14.30, I am long about $48k worth right now total. But bottom line pick any dollar denominated asset that will rise with inflation and I would buy it. You can’t print money like we have without having major inflation. Some of my fund friends say “inflation is not a problem because we have wealth destruction”, to that I tell them “Bet against them then and see where that gets you”.
Some good information for those contemplating a move in the near future.
Turns out Gio is in even more trouble than Fly.
At least he has the weather and beaches.
There’s also a nice bit on the best cities to move, tax and employment wise. Not surprisingly, a number of them are in Texas.
People used to joke about it in the past, but now it seems that rather than California becoming it’s own country, Texas might be the better candidate.
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