My forecast — despite all the hate mail and pressure I get to change it — has not changed. Based on my systems and models, I will not turn bullish on gold until either spot gold has closed above $1,823 an ounce on a weekly and monthly basis – or gold cracks the $1,527 level and plunges to the $1,400 level or a tad lower. I know that’s not what you want to hear. I know that you are as eager as I am to see the next leg of gold’s bull market begin….[but its] time to shine is not here yet. It will come again, though, so stay the course, build up your ammo, and be ready to pull the trigger when I issue a headline like “Back Up the Truck, NOW!”
So writes Larry Edelson (www.uncommonwisdom.com) in edited excerpts from his original article* entitled Be ready to pull the trigger when …
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Edelson goes on to say in further edited excerpts:
My models say: The next phase of gold’s bull market (and all commodities for that matter) is not yet here which is precisely why I’m still not ready to stick my head out and load up on more gold. Nor should you….
I know that’s not what you want to hear. I know that you are as eager as I am to see the next leg of gold’s bull market begin. I know that you want to buy more gold, load up on it and ride it to glory over the next few years. So do I, but when a market as sensitive as gold is to:
- geopolitical events,
- money-printing and bankrupt governments and
- doesn’t do what logic says it should be doing
then something else must be going on. Markets are never wrong so what is gold really telling us?
- With all the money-printing going on, why hasn’t gold broken out yet?
- With busted governments in Europe, why isn’t gold rallying?
- With new war threats coming in from North Korea and from terrorists, why isn’t gold flying to the upside?
- With all of the above, why is gold…plung[ing] anew? Why?
To those of you looking for a fundamental explanation, I see two major forces at work right now that are overpowering all the others:
1. Money-printing — even when virtually all major central banks are doing it — means nothing when most of the money being printed is merely ending up sitting in the banks. I’ve said that before and it’s still largely the case. It means:
- consumers aren’t interested in adding to debt by increasing their borrowings and credit lines and, [as such,] the velocity of money, or its turnover, is virtually non-existent….[and]
- corporations are conserving cash and largely paying down or refinancing debt rather than taking on new debt or choosing to buy back their own shares.
2. Fears of North Korea’s recent threats or renewed terrorist uprisings are — at this time — also actually suppressing gold. It’s causing just enough geopolitical uncertainty to put savvy investors in a “cash mode” of thinking and not quite enough uncertainty to drive them directly into gold.
Both of the above forces will — down the road — become bullish forces for gold…but none of the above forces will become bullish until it’s time for them to do so and, based on my work, that’s not likely until later this year – and from much lower prices…
I know it’s difficult to understand but…[one must] listen to the markets and what they are telling you. The markets, I repeat, are never wrong. Only the interpretations and expectations are so stay the course.
- Build up your stash of cash ammo so that when it does come time to pull the trigger on gold again and back up the truck, you will be able to [do so].
- Ditto for silver and other natural-resource and tangible-asset investments.
While their time to shine is not here yet, it will come again, I [can] assure you [of] that. You want to be fully ready and able to capitalize on these forces. If you listen to the pundits who proclaim the next bull market is here every time gold rallies $5 or $10 … or even $25, you won’t be ready. You’ll be far more likely to suffer massive losses. Ditto for silver.
Stay the course, build up your ammo, and be ready to pull the trigger when I issue a headline like “Back Up the Truck, NOW!”
Editor’s Note: The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.
*http://www.uncommonwisdomdaily.com/be-ready-to-pull-the-trigger-when-15658?FIELD9=1 (Written by Larry Edelson; Copyright © 2012 Weiss Research, Inc.)
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