Gold is now making a “stealth” rally after an extended consolidation. The naysayers have been around for something like a decade, but gold is going nowhere. At the end of the day, gold at $1600+ reflects a lack of confidence in our government. If Obama really did bring the “hope and change” he promised, gold would be trading below $1,000 right now without question.
We are headed straight for a recession, and sooner or later someone needs to take responsibility. I talk to Obama supporters who still blame the weak economy on Bush. This is amazing. Although I agree that the problems Obama faced in 2009 were severe, he could still have implemented sensible economic policies that would spur our economy to grow 1990′s style. But this takes an out-of-the-box way of thinking, and politicians are never open to new ideas until they are forced to listen. In this case, politicians won’t listen until bonds absolutely implode, which I would bet my entire portfolio on.
Right now, the trends based on a weaker dollar are emerging. Earnings are coming in weak, but stocks are rallying. No doubt people are confused, but believe me, their confusion will only grow because stocks are going to rally big-time as unemployment rises. I read recently that something like 10% of Hedge Fund managers are beating the market this year. Even the best and brightest don’t understand what’s going on, and this create tremendous opportunities for those that grasp the situation.
I would be buying gold stocks on every correction. You can pretty much close your eyes and buy gold, commodities, and stocks on corrections- then plan your next vacation. The government is going to screw our economy up in a major way, and there is little doubt in my mind that we will face a 2008-style crisis in the next Presidential cycle. This is your 2005 and 2006. Get prepared, use your common sense, and do the opposite of everyone else.Follow