the over leveraged Gold Market continues to unwind - that bubble burst in 2011
as the US Economy continues to recover from the "GREAT RECESSION" -- Rates will edge back up- and the US $$ will Rise --- and that will continue to push gold prices lower.
Money continues to flow in the US Equity Index funds -- large cap Tech names to benefit
As the economy continues to improve, rates will rise, the US $$ will rise and GOLD will FALL ---- continue to overweight US Technology. As money pours out of BOND funds into US EQUITY INDEX funds..
Yet according to Duke University finance professor Campbell Harvey, one of academia’s Leading Experts on gold prices, the odds are poor that the metal will return any time soon to its all-time high in August 2011 ---
He puts gold’s fair value today at a little higher than $800.
If you believe that yields will on average be higher in coming months than where they are today, as he does, then “gold will most likely decline”
Sell GOLD and stay long US Equities
Nearly $3 Billion in Free Cash Flow
net DEBT Free
150+ Million Subs with rising ARPU over the next 3 years - new services, new channels + base price increases.
Technology tailwinds -- explosive growth in streaming devices ( Mobile Phones, Tablets, TVs, Set-top Box) at faster and faster speeds.
Even Disney -- a content provider and broadcaster turned to Netflix to distribute its products.
Clear takeover candidate -- by GOOG MSFT AAPL
Tort reform !!! All the useless expenditures ! Rich Immigrants will gladly buy land !! There are millions of millionaires who want into the US - open the doors ! Dod cuts across the board 20% reform the Prison System - more small biz lending vs student loans !
DoD - cut spending, sell prime lands in California, cut and overall healthcare spending !! The US spends over 17% of its GDP on Healthcare - the rest of the G7 is around 11% - the do consumption taxes !! Alcohol, cigarettes, gasoline, VAT ? Lots of opportunities.
Spend less !! Not just government - people !
Tech, of course you know that is not the only way !! You are not that naive - raise taxes, cut spending, sell assets. You just cannot admit - you have been dead wrong for 3 years.
6.1% unemployment ! interest rates and the economy are going UP -- US $$ will rally and GOLD will plunge ! stay long US Equities.... Happy Days are coming back to the US !!
the US dominates - Technology, BioTech, Media/Entertainment, Planes, Auto, Consumer Products
that's why they get paid the big $$ to make the call ahead of time... based on detailed analysis, models -- other what certainty -- something the market seldom provides.
up next -- the second leg of the housing recover.
the first - was the Investor Driven - Dead Cat Bounce of the lows.
the last 12 months -- we have consolidate the price increases and the slight rise in Interest Rates.
Housing 2.0 -- will be economically driven (already 20% of the US is back to record highs) -- but the rest of the country has been lagging - the recovery will spread - with rising employment, near record low rates, pent up demand, tight rental markets, 7 years of under-building driving lack of supply etc....
I wish there were a more Urban focused builder -- because that is were the first time buyers are going to buy... TOL has lots of Urban but its price points are too high.
Sentiment: Strong Buy
as we enter Q3 - expect re-balancing among mutual/ pension funds -- sell bonds to buy equities. -- as rates rise and the economy improves --- that $1 Trillion that went into Bond funds will migrate into US Equities -- setting up a late Q4 immediate top in US Equities.