but we will survive and if POG stays above 300, be a profitable company with no derivatives mess.
No mention of the effect of derivatives on C and JPM, just a simplistic overview of the Enronitis.
I must be crazy but gotta hold on for the next wave: the war economy gains a footing. Miners did suffer in 1929 crash along with the market, but then the bull market in POG resumed.
Also notice that POG is not some kind of "counter market" play. It will go up if the dollar goes down. Last few weeks we saw a major assault on gold by desparate banks.
This is the worst bear market in equities since 1929-32, but we had a depression back then, and now not even a recession? I think the fed may be forced to lower rates again soon, and that will help gold and silver.
I believe the correction in PM's will end when someone tries to corner the silver market very soon...
The markets know, but we as individuals do not know. Is the market telling us that interest rates will be raised substantially over time? There's many reasons for a raising of interest rates, 1.) foreigners may demand it in order for them to agree to hold our paper, 2.) the elderly voters with mostly CDs want higher rates, 3.) the supply of credit is drying up and when supply is short prices rise, and 4.) in order to enjoy a world currency status, the dollar must now compete with the Euro. Europe did not lower rates along with the U.S. and the Euro is backed by gold to the tune of 15%. Greenbacks are money and gold is money. If greenbacks have a negative rate of return, gold is better money. But if greenbacks regain a positive rate of return, they become more valuable. What are your thoughts?
<<Is the market telling us that interest rates will be raised substantially over time? >>
Youir points are well taken. No interest rate increase is on the horizon now with equities pointing toward a double-dip recession, the fed can't lower rates. Foreigners have already dumped a sizeable qty. of dollars, and your point about senior citizens is a good one, but when has the fed ever listened to AARP for advice? The fed has been trying to artificially inflate the economy, get some recovery going, and some inflation would be welcome at this point.
Don't be surprised to see the Federal Reserve step in and LOWER the Fed Funds Rate to shore up the Stock Market carnage. GOLD has traditionaly performed it's best at the turn of an Interest Rate Hike. Lowering Rates now will continue fuel the fire of dangerous future Inflation by continuing to print new money, but Greenspan has no choice right now, if the Market keeps droppin he must provide Liquidity. We will see... RUBICON