Everything’s relative, I guess, including pain. Today’s revisit to the recent lows (and no, we’re not there yet) is not as painful as, say — a bloody compound tibial fracture jutting messily out of one’s shin. That said, it sure has been a frustrating six months, hasn’t it? And yet, if you look at all the major charts, it looks like at this late point in the cycle, the worst we are going to get is a revisit to the end of February lows, which — not insignificantly– were at the 200-week exponential moving averages for most gold and silver stocks. Royal Gold (RGLD) is still my favorite here, but you’d have to be crazy not to take advantage of the yielding plays available through NEM, AEM, and even ABX — and those are large caps you’d never see me recommending in a “normal” market.
But this isn’t normal. There’s a concerted, global (read Big 8) effort to devalue currencies — and therefore reprice debt — the world over. The only way those central banks can get away with this kind of routine, and save their debauched systems, is to get it done under cover of a “deflationary” scenario. The easiest path to that is to keep their foot on the less liquid large commodity and precious metal markets. This whole American Earl Revolution is a God-send to the central bankers, because it’s bringing supply on line in a period of global currency inflation. Ask yourself why oil prices have remained so stubbornly high, however, despite the onlining of so much new supply in the world’s greatest petroleum consumer.
How much longer can this kind of thing go on? Until the little guy cries “uncle” as loud as Soc Gen just did? Given that I was expecting a retest, and the large volume bars we saw at the late February lows, I am thinking this week and maybe the next will be the final washout. I’m still holding tight to my remaining cash, however. Like in late February of 2009, I don’t expect these prices to hang around for very long once the next cycle takes flight. That said, I think there will be ample time to take part once the bull trend resumes.
Best to you all, and Go Cards!
PS – this retrace is also an excellent time to buy some physical, if you’ve been holding off, including 100 oz silver bars and nice liquid gold coins like Maple Leafs or Eagles.
Defense wins championships, right? It also keeps one alive to survive and advance. With Cypress pulling out the last minute levers to confiscate “excess deposits” in order to balance its public accounts, how good are you feeling about “independent” depository institutions right now?
Sure, I know. None of that stuff could ever happen in the U.S. We’ve only got $20 trillion or so in 401k assets across the country. We’re only a Bloomberg decision away from your friendly gummint deciding that asset plan could be much more “sustainable” under their “supervision.” And heck, what’s safer than gov’t treasuries after all?’
Remember, they are just looking out for your best interests.
But own some physical gold and silver anyway (now’s a great time to pick some up for the longer haul). And you know what? A Kimber ACP might not be the worst idea either.
Keep #6 and his family in your thoughts and prayers tonight as he battles the Great Sandy Storm Surge of 2012 from the burgeoning tides of the West Village. He’s currently okay, although I think the water made it up to the ground floor of his place near the newly enlarged Hudson River.
And all the rest of my boys up there in the Northeast, including Monsieur le Docteur du Fly, take care of yourselves up there and don’t do anything crazy like trying to drive out of a flooded area. And beware of downed power lines in puddles. Bad combo.
The good news is that the market will likely open with a fresh wave of Bernanke Bucks sluicing its clogged bowels. Silver is my trade here, and I will likely be adding on Wednesday.
Best to you all, especially all of you dealing with this Sandy Hurricanoe.
Soon, soon I will be a plunger yet again. Morsels are looking tasty already, and I don’t think gold and silver have too much farther to go here. There’s a lot of support for physical silver at this $31.80-ish level and I may choose to nibble there tomorrow if we get one more rip to the downside. Then stuff will be on sale like you read about. SLW at $37?, AG at below $22? RGLD at more than 15% from recent highs? Are you kidding me? These are the times when men can be gluttonous, in a sippy-cup kind of way (small sips, gradual like).
I will have time to speak about the recent Obaminations when I’ve got ten minutes to assemble my thoughts. Needless to say, last night was more revelation. I think I’ve come to the reluctant conclusion that the guy is just not very bright after all. The consistent throwing of constituency after constituency under the bus…. when will it end? Last night, he gave up Virginia by blowing up Newport News and its naval stronghold. Ah well, who needs those bayonets, save our own guts?
Maybe he’ll talk about how he hates Buckeye nuts, next? One can only hope… (for change?)
__________________________________ Silver looks to be giving us another opportunity here. The miners are not taking too much of a hit here, so you may want to give the stronger stories more of a look, or you may want to take advantage of the actual pullback in fizzical silver itself by jumping on SLV right now in the form of long term options, the farther the better. Let’s say January 2014 or 2015′s LEAPs which have pulled back nicely here for my benefit and yours. Accumulate slowly here, because eventually you will wish you had been quicker.
Things are going well, and I appreciate my market meandering here a bit.
_______________________ In the end, “Robocop” was too kind.
Forgive your loyal, unpaid servant, but not only was I trying to send out a hastily assembled marketing book for one of the finest companies I’ve ever had the privilege of introducing s, but I also had a long scheduled string of appointments in Michigan this week as well. Nothing like starting in beautiful, well capitalized, conservative Western Michigan on Monday and then working one’s way across the state, only to end up in moribund, corrupt and ultimately failing Detroit in Eastern Michigan. It’s not overly exaggerating to compare the two sides of the state to West and East Germany… they are that different in their economic viability.
Detroit is a wreck, and it’s a damn shame. There are hundreds of thousands of very smart people populating that Southeast Michigan region– engineers, technicians, deeply skilled manufacturing personnel, etc., etc. What hope have they, however, arrayed against the institutional, long embedded machine politics-corruption that destroys the rule of law and therefore any hope that a level playing field might be established for investment capital? Let’s face it, you’d have to be nuts to try to start a business in Detroit. There’s more atmosphere on the moon.
That said, I had a great time meeting the private equity personnel operating in that region. And the Tigers game was fun too. But nothing was as important– or moving– as my meeting with the esteemed, venerable Detroit Patriarch, Mr. Cain Thaler. It took a number of phone calls with his “people” to arrange a meeting, but let me tell you it was worth it. It’s not often you get to meet one of the guys who hung with Edsel Ford and the Dodge Brothers “back in the day.”
I had to wait outside the Marriott Motor Access area for half an hour as Cain’s preliminary security ran through their checks. They were nice guys, but pretty obviously ex-Special Forces, so I kept the chat to a minimum. When Mr. Thaler himself rolled up in his stretch Cadillac (of course) limousine, I was on pins and needles. When the door was opened by his personal bodyguard (a flat-faced Mongolian giant, six-ten, and about half that wide), rich, sweet and thick Havana-based smoke billowed from the back seat for what seemed like ten minutes but was probably more like 30 seconds. Finally, a gnarled, liver-spotted hand clutching an ivory headed cane (hint hint?) pushed out from the back seat. It was the man himself, the Legend.
Our discussion will remain between us, but let me tell you that he imparted generational value to me… business advice that I will cherish and pass to my own children, God willing. Thanks you sir, for your good will and your patience. I wish I could impart some of your wisdom to this crowd, but I will hold off, affording you the discretion you’ve earned.
I look forward to the next time we might share some bourbon whiskey, and some tales of the good days, when Detroit was America’s engine. My best to you.
I actually bought a farkakta load of SLV Leaps today. 2014′s and 15′s. A humbug schitload. I think silver is going to go berserk here, but the ride will be violent. SLW, EXK, AG and maybe SVM if you’re bold, SIL if you are not. God bless we are in trouble, but I take heart that there are still men like Cain Thaler — who remember that commie asshat Roosevelt — to help guide us back to the righteous path.