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My Son's Weight in Gold

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Gold $388 Silver $6.33 Friday 30th July, 5am Sydney.


"I fired him because he wouldn't respect the authority of the President. I didn't fire him because he was a dumb son-of-a-bitch, although he was, but that's not against the law for generals. If it was, half to three quarters of them would be in jail." -- President Harry Truman on why he sacked General Douglas MacArthur in 1951 (about 12 years too late).


G'day. I dunno why I put that quote up, but it gave me a chuckle when I read it.

Well, that was it then, was it? If we didn't get that rumour about wotsisname allegedly being captured, it would have been terminally boring in metals and currencies. I expected that the dollar may well have retreated further and triggered stops in gold to take us back to the $393ish level. The Euro stalled before 1.21 and so did gold. I think that any dollar weakness will send gold higher than it warrants, as it appears there have been plenty of short sales added in the past few days which, if I'm correct, will scramble to cover. Should we see 1.22 Euro in the next 24hrs, we could be pushing $400. Just thinking aloud and not advice.

Similarly, gold couldn't trade below $386 when Euro broke 1.20 briefly. Seems that there are some resolute buyers about. I would've thought with Yen and Euro moving as they have in the last few sessions, we would have seen gold break lower and I am pleasantly surprised by its resilience thus far. But tomorrow is another day entirely - GDP or something will make whatever we say irrelevant in some way.

India is importing gold aggressively despite a weak rupee and it being out of season. I suspect the physical market is very happy everywhere.

All the base metals rose today except Lead, which has been a star performer lately so was due for a breather. Zinc, Nickel and Copper were the best performed. Platinum is up 2%. Oil is still causing plenty of angst. Gold and silver down, of course.

Silver continues to consolidate around $6.30 and, notwithstanding some scary potholes, is looking pretty comfy for the time being. That could change in 10 mins though. Sub $6 still flashes before me but not quite so brightly at the minute. The economic data releases and the immediate reactions of the market make it bloody hard to maintain a consistent opinion at times. One minute we're buying for x reason and next we're selling because of same??? Oh well, that's life.

The Amex Gold Bugs Index (HUI) is a percent off its high set this morning, and am a little concerned we may see a late Thursday metal equities assault in advance of tonight's numbers. If one was gonna bet that gold was gonna go south from the data release, why not go for leverage and short some gold stocks? Just thinking aloud, and not advice.

I may have sold my broodmare. I don't mind waking to take those phonecalls at the equivalent of 3am. The buyer is vetting her on the weekend, and the price has been agreed. My son's weight in gold gets them the horse. Done.

I have just finished reading one of the great books. In a similar style to "Stalingrad" by Anthony Beevor, the book is "Kokoda" by Peter FitzSimons. It critically examines the WWII battles in Papua New Guinea that inflicted the first defeat of Japanese invaders on land. Contrary to popular global belief, it was the Australian "militia" of the 39th Battalion from Victoria, reinforced by a bunch of hardheads of 6th Division AIF( 2nd Australian Imperial Force), who were dragged away from biffing Rommel in the desert by the Australian Prime minister in direct defiance of Churchill. It is a sensational read for anybody as it reads like a novel yet is a work of historical significance.

"Isurava was not merely a battle on the Kokoda Track, but Australia's Agincourt....." Peter Brune - We band of Brothers.

The former PM of Australia, Paul Keating said of Kokoda -"... were fighting not for Empire, not in defence of the Old World, but the New World. Their World. They fought for their own values. For Australians, the battles in PNG were the most important ever fought."

Others recently enjoyed ... some holiday reading, others more cerebral....

Stalingrad - Anthony Beevor
The Increment - Chris Ryan
Financial Reckoning Day - Bill Bonner
Without Remorse- Tom Clancy
Greed - Chris Ryan
The Power of Gold - Peter Bernstein
Adventure Capitalist- Jim Rogers
Mad Money - Susan Strange
Reminiscences of a stock operator - Edwin Lefevre
Tales of the Turf - Les Carlyon

Enjoy the rest of your day....


Laurie.

position in gold & silver

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