Gold stocks - deeply sold off

The markets have a habit of teaching us things.

Who would have thought that gold could be at $1,650 and gold stocks would have fallen over 30% in the last 9 months.  Many measures say they are cheap as they have been for a decade.

Cashflows are better, but everyone hates them. Their time is coming. But beware the liars as Charles Dickens called the miners.

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/4/22_John_Hathaway_-_8_Key_Charts,_Gold,_Fed_%26_The_Big_Picture.html

Meanwhile the Central Banks are buyers of the barbarous relic...

Mexico added 16.8 metric tons of gold valued at about $906.4 million to its reserves in March as nations including Turkey, Russia and Kazakhstan increased their holdings of the metal, International Monetary Fund data show.
 http://www.bloomberg.com/news/2012-04-24/mexico-raised-gold-reserves-in-march-imf-data-shows.html

Hiatus over...and so is the calm in the goldmarkets

Nothing has been fixed
QE to continue, else the debt in the system craters it.
Big corrections in gold and silver, compared to the equity markets, masks the coming storm!

We don't see things as they are, we see them as we are. ~Anaïs Nin

Worth pondering, generally and in the context of what we think we know about markets.

Gold Stocks...fuel waiting for a spark

http://www.safehaven.com/article/21388/will-gold-equity-investors-strike-gold

Gold stocks are cheap by many measures. The article above sets out the story well. If not as cheap as 2001, then very close. Gold at $1,800 per ounce will send rivers of "fiat dollars" through the cashflow statement.

Are you listening to Mr Market? Or are you happy to buy bank stocks yielding a healthy 9% dividend, with tepid growth prospects?

The stocks have started a move already...those in the know have been buying into the sell-off. The many will come soon enough. Keep an eye on the 600 plus level on the HUI (US index).

"You can avoid reality, but you cannot avoid the consequences of reality" Ayn Rand

Banks are insolvent...at current asset values and cashflows! Understanding the consequences of reality, you can prepare. Capital is working it out. Are you listening?

Meditate on the questions:

- Why is greece not allowed to fail?

- Why are banks not allowed to fail?

- Why is gold rising?

- Why are banks stocks falling?

- What is capital doing?

- How is all the debt to be re-paid?

- How does a reserve currency solve it's problems?

The USD - walks a fine line

The USD has been very weak during this stock market correction and the flight into government bonds. This is quite surprising given the problems in Europe. I'm not sure who coined or used the phrase recently, but he said "we walk on the edge of chaos" - he is right, and the USD right now is close to crossing that line. Once it does, GOLD will go higher, reflecting the loss of purchasing power of those dollars. Never has a global reserve currency been at such a point. This may be why Mr Sinclair, an extraordinary "harmonious" market reader, sees the beginnings of a hyperbolic move. Gold looks extended - but that's the definition of hyperbolic - the next month will give us the signal.

$1,800USD gold - Momentous!

Today gold hit $1,800 in USD terms. It has moved substantially in all currencies. It is a momentous day, because of what it announces to the world about fiat money – money backed by nothing other than the promises of government. Confidence is “officially” broken. The words of the Central bankers and governments are rendered meaningless. Worthless. Worth nothing. Gold now waits for actions. No, it screams for actions.

The sound money men are vindicated today. They warned of the 20 plus year policies that have led us to this point. Ridiculed, by academics and professionals everywhere, they stood alone, in the minority. They still are. But not for much longer! Gold has announced their arrival and before the final and dramatic act is over, monetary history will be learned by many, many more. Including the doubters and the “professionals” stuck, mindlessly in their recent history paradigm. The professionals - smart men? Yes. Wise? No.

The seeds of the great re-awakening are in this momentous day. By the end of this there will be a demand for sound money. It is coming.

I thankfully and gratefully acknowledge the independent and courageous thoughts and teachings of those men and women who understood history and the nature of the current system. They stood for something. They stood alone. I humbly say, thankyou!!

Specifically, I would like to list the following: James Turk, James Sinclair, Marc Faber, James Rogers, Eric King , Eric DeGroot, Dan Norcini, Eric Sprott, John Embry, John Hathaway, Ron Paul, the Austrians, DG, DM, CL....and many more