Friday, January 27, 2017

Gold will be stronger after India's currency supply issues are resolved

The situation in India continues to be problematic. The liquidity that the Modi government had promised following its currency “conversion” scheme has not yet appeared. Eventually the new currency denominations promised by the government will be fully available, but until then India’s citizens are living in a relatively “cashless” environment when “cash” has always been the preferred method of doing day-to-day business.

As a result gold buying on the part of India, the most important gold buying nation in the world, has remained subdued at best.

In that light, gold has held on quite well and we are left to wonder how strong it shall be when India returns in full regalia?

Wednesday, January 25, 2017

Bitcoin panic selloff was inevitable

Bitcoin may be the currency of the future but quite honestly we find it quite nearly incomprehensible at this point.

Monday, January 23, 2017

Gold to rise in Euro and Yen terms

No one anywhere should be surprised by this weakness for after nearly a month of quietly stronger prices, some correction is to be expected.

Many are blaming gold’s weakness upon the comments from Ms. Yellen ... and we shall not discount her comments… or theirs either… but gold was already showing some signs of ‘tiredness’ before Dr. Yellen took the stage.

Bullish Dollar and Gold

Why would we wish to use a currency… the dollar…which we think shall rise in value to buy gold when we can use currencies that we believe shall weaken to do the same thing.

Thursday, January 5, 2017

Its still a bull market in early 2017

STOCK PRICES AROUND THE WORLD ARE STRONGER AGAIN as our international Index has risen another 58 “points” or a bit more than 0.5% and although we are suspicious of this continued strength and although we are certain that a correction of some consequence shall happen “of a sudden” and only when it is obviously very least expected, one cannot take an overtly bearish stance for that would be folly. 

Again we shall simply suggest that this remains a bull market and that in a bull market that one is suspicious of one shall do best by being neutral of equities on balance, and so we are.

We are acting as a good “hedged” fund would act, being long of the things we like while being hedged against broad market risk at the same time.

Appearing on CNBC’s “Fast Money” last evening we again said that we wish to own the “things that if dropped on your foot shall hurt.” That is, we wish to own the simple things incumbent in economic growth: steel; ball bearings manufacturers; railroads that move “stuff” and the like. This is an old story; but it is nonetheless a very good one. If auto sale are as strong as they are domestically…as noted above… and if they are stronger still in China and Asia, then steel demand shall remain strong. Further, if the Chinese government wishes to crack down upon manufacturers there because of air pollution concerns, steel manufacturing in China may slow, with global demand still remaining rather high and thus forcing steel buyers to the US or perhaps to India. Sometimes, simple makes sense and in this instance, fully hedged “simple” might make the most sense of all.