Comment: matt

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In reply to comment: I have three questions for you (see in situ)


All good questions. I don't have a crystal ball and technically I only advise on physical gold and silver, not mining companies. That said, I did recommend investors in Sept. of 2010 buy the physical and sell the miners when gold was $1,314 an ounce and the HUI was 512.56. Today gold hovers above and below $1,300 and the HUI is 217.31. I will make a call again for "all-in" for miners at some point. Just not yet.

The only logical explanation to your 3 questions can be summed up in price action. Richard Russell always says look at the price. He can give a 100 reasons why gold should go up since 2011, along with all of the other gold folks, but price action trumps all speculation as to why and also trumps logic when pulling out what the cost of mining is or GOFO.

I have trained my clients to simply dollar cost average into an allocation, buy the dips, and go enjoy their lives. But my clients aren't traders. I try and write articles for traders based on what I see and have done well with the timing of those so far. I really don't write that many articles either. I'm not Kitco, lol. Kitco will pull a reason out of a hat as to why gold does what it does.

As far as the extreme moves in thinly traded markets, when someone wants out and there is no bid, the price will drop that fast. Usually occurs overnight. That in turn will cause further sell stops to expedite the selling. Last April when it occurred, my clients were calling me to buy. They were trained well. I was calling some as well. December was the same story. They'll call again on the next major dip which I still think will come. I have a few million of orders waiting. Will have more once my book comes out and people see I simply call it like I see it.

Hope that helps some. Not specific, because I don't think one can get too specific although I do follow a few over on Seeking Alpha where I comment quite a bit. I stopped writing for Seeking Alpha because of their bias against physical gold/silver and their editors wanting me to push paper products (ETFs, stocks, mutual funds). I'll probably be back writing there again.

The most important thing you said was the following; "The important thing is the value of the dollar relative to tangible things, most notably gold and oil. If the market is manipulated, as I suspect it is, then the dollar isn't as healthy as it appears."

That's part of the illusion. "Priced in gold" is the key IMO. But right now, gold and silver are getting closer and closer to where I prefer them versus anything priced in them. A little patience is needed in my humble opinion.

Author of Buy Gold and Silver Safely
Next book: Illusions of Wealth - due out soon
Also writing book We the Serfs!