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PCTEL, Inc. Message Board

  • commandor58 commandor58 Mar 17, 2013 1:30 PM Flag


    Back in mid Jan on the AHS msg board, I warned about the implications of the Cyprus bailout. Again, in late Feb I warned of a bank run. Given the terms of the "bailout", which is really a "bail-in", over the weekend, it will interesting how much of a bank run will occur in Cyprus and other Euro-zone non-core countries.

    Given the continuing problems in Europe, just about all banks are under capitalized, other "bail-ins" should be expected in the coming months/years. I would also expect the same in the US when Treasuries move 100-200 basis points higher, in a short period of time, leading to tremendous losses at US banks-which will need to be re-capitalized with depositor money.

    For investor implications, I would expect a strong $ this week vs the Euro and lower gold/commodity and stock prices as the process is deflationary. Which is according to my plan-often quoted in recent weeks/months on this and the AHS msg board. I suppose the "wrinkle" in my view would be for the markets to anticipate more or the promise of more QE, immediately, as the policy response.

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    • There is talk that Russia will come in and bail out Cyprus for all its NG rights. Should that occur, I think it reduces deflationary downside risk-net net bullish for gold. My first buy is ABX, then GG.

    • Commander you have been prescient and generous so we keep calling on you. Re NG, how do you see the gas/coal dynamic unfolding for the rest of '13? Eventually regulation will seal the deal in favor of NG of course, but what about the short term?

      • 1 Reply to gulleyj56
      • W/R to NG, I'm tempted to take some profits if/when NG hits $4.05-$4.10. Since mid Feb it has rallied $.80 from $3.13, so a 50% pullback to the $3.50 area is my expectation. At that time, if I am correct, I'll replace inventory and buy net more as I expect NG to get to $4.50 sometime in 2013.

        I pick $4.50, because at that price, the vast majority of producers can cover their all-in costs and still make a decent % profit. Longer term, winter of 2013-14, if NG gets above $5.00 and the rig count gets back over 500, then I will look to sell most of my positions as the reward/risk ratio there is fairly equal.

        Of course, if there are supply disruptions (hurricanes) and/or favorable legislation (anti-coal and/or pro NG vehicles for example) then I will hold for $6 on NG.

    • I thought of you as soon as I saw the headline about the run on Cyprus ATMs. Once again you are on the money. The stock market has been going up, but I believe your take on the entire situation will play out. Im looking to purchase gold/silver on a future dip. Thanks again for all your analysis.

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