Today is the last day of August and for metals bugs it’s a case of good-bye and good riddance. Torpedoed portfolios lurch directionless in turbulent shark infested waters. Some investors have already thrown in the towel; others wish that had joined them. Are we about to join them? Not a chance!
Next week sees in Labor Day, 5th September, just another day to some but we see it as the end to the summer doldrums and a resurgence of interest in the markets generally and the precious metals market in particular.
The hole has been dug and the dollar is about to be slowly buried. What other choice does the Bush administration have? One way or another some folk are going to be upset, the holders of dollars in foreign lands or the embattled house owners.
The presidential election is creeping slowly towards us, so do they sacrifice the dollar and possibly get re-elected by lowering interest rates in order to add a little cheer to those who can vote for them or do they protect the wealth of others? The answer appears to be obvious to us, as we don’t know too many politicians who have the guts to do the right thing, but we know a few who will do whatever it takes to remain employed. Cynical? Yes it comes with experience!
However as metals bugs we are heavily invested in gold and silver stocks and feel very positive about being in this small market sector. The negativity that hangs over this sector, the market sell off, the sluggishness of the Gold Bugs Index, inflation under control so they tell me, its enough to give up. But, gold refuses to lie down, stubbornly holding on despite the snipers. Eventually the dollar's demise will become apparent, inflation will be out of the box, gold will move higher and the stocks will follow with a bang. When? From the 6th September onwards through the fall and well into next year.
Take advantage of the fog and relieve some of the ditherers of their quality gold stocks while these prices last.