Dec 7, 2015

The Best Environment For Gold

The best environment for Gold is going to be when the weakest currency is the U.S. Dollar. Gold does well when all the currencies are going down but for some reason the U.S. Dollar needs to be going down the most. Because if the U.S. Dollar is going down more slowly than the Euro Currency or the Yen everybody assumes the U.S. Dollar is strong and Gold goes down which is an asinine assumption and obviously its not going to be able to persist that way. Ultimately gold has to go up.

Dec 4, 2015

Dow Jones: The 2,000 Points Relief Rally May Be Reversed

We were down 400 points in the last 2 days on the Dow Jones Industrials and remember the Dow Jones rallied 2,000 points off its September low. That is where it was when everybody thought the Federal Reserve was going to hike interest rates in September and when we got that bad jobs number we had a 2,000 points relief rally because the Fed was not about to raise rates.

And now what as been holding up the market was the idea that the ECB was going to come in with all this money printing. But now that we are not going to get that and people still expect Yellen to raise rates, well, we might lose the entire 2,000 points relief rally in which case the rate hike is back off the table as if it was ever on the table in the first place.

Dec 3, 2015

The Fed Is Going To Look Ridiculous For Having Raised Rates

They waited so long to raise interest rates that the economy is already going into recession on its own without any help from the Federal Reserve. If the Federal Reserve now gives it a push by raising interest rates even slightly, we are going into recession that much quicker and the Federal Reserve is going to look ridiculous for having raised interest rates so close to the beginning of the recession.

Gold: Hedge Funds Are The Most Short They Have Ever Been

By the way, hedge funds are the most they have ever been in Gold right now, the least long, the most short, their net short position.

Obviously everybody who shorted gold, if you shorted it over the last few years, you are ahead. That trade is a winner for everybody. Let`s see what happens if the price of gold reverses between now and the end of the year  and we get a lot of hedge funds that want to book those profits. We will see how much profit remains to be booked if all the shorts at once decide to cover because I think a lot of people sitting on paper profits are going to find these paper profits difficult to realize when everybody is trying to realize them at the same time.

Meanwhile in the physical gold world the demand for gold continues to hit records as we are getting reports from the mints about what demand is for actual physical silver and gold coins.

Dec 1, 2015

U.S. Economy: Consumers Aren`t Confident

This was the lowest level for Consumer Confidence in 14 months. The Federal Reserve is just getting ready to raise interest rates as the economy is supposedly ready for it yet consumer confidence is at 14 month lows.

Consumers were a lot more confident 14 months ago when the Federal Reserve said they could not raise interest rates but now they are saying, "Everything is perfect, we are going to raise interest rates" and they are getting economic data that suggests that thy should be doing the opposite!

Corporate Profits Are Declining

Buried in that GDP report were some other very bad numbers. For example, there was a 4.7 percent decline in corporate profits during the quarter. That is the biggest decline in corporate profits since 2009!

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