Monthly Archives: May 2012

There’s No Freakin’ Gold Bubble, OK?

This is from a Tuesday After Lunch Money Memo from March 29, 2011.  It’s still applicable now, in May of 2012.

 “No one knows when the bull market in gold will end.”  Richard Russell

gold bull In my last TAL, I said not owning gold in the current gold bull market is nuts.  Then I thought, wait, maybe some folks aren’t buying because they’re listening to financial TV that’s telling them gold is in a “bubble.”  “Whoa,” say the Wall Street trolls and mavens.  Stay away from gold! We’re here to save you.”  Yeah, right. Are these are the same Wall Street idiot savants who overlooked the tech bubble, failed to notice the credit meltdown, and totally missed the subprime real estate eruption?  And now they’ve developed “vision,” and are able to see frothiness in the gold market…the same gold market they ignored for the past ten years?  And you’re listening to those guys why?   Yes, we’re in a gold bull market.  We’re in Act two of a three Act gold bull market.  Act II is when institutions buy.  Today, mutual funds, insurance companies, foreign money managers, and hedgies are wading into gold, and the car and pharma company advertisers at CNBC don’t like that.  So CNBC knocks gold. Every bull market ends with a party mania, and Act III is the bubble finale.  And the marker for Act III is the entrance of the public into the fray.  When the public buys, they buy with abandon, and their money soon does the same to them.  There are other recognizable conditions that appear in an Act III bubble. Here are a few: Continue Reading