http://mxphotos.net/combat4-04/488.jpg
me thinks

Bill-

Looks like we were correct for nowto keep this buttoned down tightly.

The problem seems to be that the market can't seem to rally off this oversold condition. That, folks, is not a good sign. When the SP500 turns down, a lotta stuff is being dumped. Although people seem to be hiding in staples, health care is being taken out back and shot. So that removes that sector as a bid. Instead energy continues to play a positive role, and that too is an iffy proposition. All in all, a very bad and strange trading environment.

Right on. I moved to the sidelines significantly myself today, too.

A weird market, indeed.

Folks,

Trust me…trading equities, commodities, precious metals, futures, currencies, etc., (US and high-quality Corporate Bonds excluded), is pure speculation and as the old saying goes: “Everyone's is a genius during a Bull Market!� The real challenge is surviving in a down trending Market when all the man-made rules are not working as predicted.

Maybe, just maybe, our Government (USA) has finally made the responsible determination that in order for the economy to fully recover beyond these bogus statistics being published daily (GDP, CPI, basis points, new housing starts, existing home sales, etc.,) and compete in the global markets (China, India, emerging markets), they are going to have to curtail consumer borrowing (spending-NOT) and induce consumer saving. Not a pleasant strategy, but a necessary one if the infrastructure is to recover and flourish. Forcing interest rates higher will most certainly induce Middle America to scale back acquiring those Lexus' and Mac-Mansions they couldn't afford when they began using those ridiculous ARMs and mortgage equity loans to acquire them. The day of reckoning may be at hand – if we believe our Government has the “Cojones� to implement said strategy.

“Won't this strategy surely bring about inflation?� Inflation in a free market economy is a not-very-pleasant fact of life. I recollect a not too distant past when bread (a consumer staple) was a dime a loaf and better tasting, gasoline cost a quarter a gallon, and a good US-made automobile (loved those late 1960s Mustang Mach I's) was priced at three thousand dollars using organized labor to manufacture. These days we tolerate incompetent economists who brainwash the we the public with phrases such as “adjusted for inflation� to justify the exorbitant prices we pay for goods and services while never examining the underlying costs to produce said goods and service to discourage excessive profit-making.

The above is just speculation; however, I would not fault the Government if such a policy is implemented – once our current President and his minions leave office, of course.

If nothing else, your admission that you might have been early on the gold play, and setting a specific STOP, was a good lesson for all. That's how it's done , so you live to fight another day and don't damage your account.

There's a certain bald guy that plays an advisor on TV that would never have done that so close to the original call.

Awhile back, I said that either the gold market or the bond market has it wrong about inflation. I think it's the gold market. As usual. Bond market is a much better tell, IMHO. Always has been. Long term rates have done squat. Why? Because inflation is mild.

The Fed is jawboning, that's for sure. If they think rising energy prices are inflationary, outside of the energy complex and transports they're wrong. If folks are sending an extra $100 a month to OPEC instead of spending it at Cheesecake Factory or the shopping malls, it's not inflationary. Especially with wages not keeping up with the stated inflation rate as it is! The Fed isn't monetizing inflation, either.

I think investors are leaning in the wrong direction.

Disclosure: Long to the hilt!

;)

I sincerely hope that all this mirror bowing holds water. Lower entry points in gold may be the buy of the decade...but me thinks it's too obvious. Another retest and massive capitulation? I can only hope.

IMHO, Big Ben wants two things; to help out the man who chose him by having the economy, the housing market and the stock markets on firm footing come the fall elections AND to fool market participants into thinking that he will be tough on inflation. So, the fed statement will attempt to do both. Rates will be raised while talk will continue to stress beating down inflation. Behind the scenes, money will be printed and put to work to support stock and bond markets while depressing the gold market. If that is how it plays out, the actions are inflationary. This is simply a guess, of course.

I have the largest cash position in years with the longest shopping list to go along with it. I hope to have use for both. Go Ben!

to jason22 - best answer I have ever heard, LOL!

"military formation is like water - the form of water is to avoid the high and go to the low, the form of a military force is to avoid the full and attack the empty; the flow of water is determined by the earth, the victory of a military force is determined by the opponent....

so a military force has no constant formation, water has no constant shape: the ability to gain victory by changing and adapting according to the opponent is called genius." sun tzu. the art of war.

let's not kid one another. if i cannot change my opinion on a dime, i am not a trader and i do not believe in the auction. kudos bill.

oratier-

If that happens, you will hear an Allelujah from this quarter. But in order for the US to act in a long-term responsible manner, we will need a wake-up call.

Re: GLD and miners, Bill's entry point was fine and, of course, I have no problem with setting tight stops here as I mentioned that as my preferred tactic. This is a range-trade to me (550-590) til Fall and I will play it that way. Once rate cuts loom on the horizon, gold will anticipate them and start moving up as the $USD tumbles.

It was a surprise to me also that XAU didn't get a pop to the 144 level by now but again the whole equity complex is in the fight of its life. Lowry's is still reporting Selling Pressure near multi-year highs. Buying Pressure is still at multi-year lows. So be careful out there.

Existing home sales in May were down nationally, but prices in many areas "continued their climb". That sadly, my friends, is what's called stagflation. As I stated previously, unless oil prices collapse, I think only a recession will stop this cancer, a condition that Ben's predecessor and mentor, Easy Al, was deathly afraid of because he felt that it stymied creative minds whose work leads to invention and increased productivity. But Easy Al forgot one thing, recessions stop bubbles from becoming mega bubbles which can threaten global stability.

Stagflation = gold bull

Stagflation = gold bull