Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Don't Be Blinded by Current Equity Market Euphoria


Herds are selling their precious metal investments to enter US equities on the hope of a recovery, giving precious metal investors an opportunity to buy gold and silver on sale.

Editor's Note: Read more from Jeb Handwerger at Gold Stock Trades.

Bill Gross, the PIMCO money manager, to whom it is often worth listening, cautioned this week that our nation's leaders really don't know where they're going. They're mired in the fiscal quicksands of perpetual trillion dollar deficits. I believe, as he does, that there will be more agony ahead after the present euphoria in the equity markets. Thus I say, "Caveat Emptor -- Let the Buyer Beware!" Our leaders are paying scant attention to the "Buck" that is being passed on to our children who are going to be stuck with the bills. Today I don't see anybody around to weep for our infants. As the reporter covering the burning of the Hindenburg shouted in horror, "O the humanity!"

Even though the markets are hitting new highs, don't be blinded by the current euphoria on equity markets. Bullish sentiment is reaching new highs, surpassing the pre-credit crisis top. Herds are selling their precious metal investments to enter US equities on the hope of a recovery. This is giving an opportunity to precious metal investors to buy gold and silver on sale. As the mining stocks correct and gold and silver make a healthy pullback, precious metal traders who took profits in October and November, when it was overbought and reaching resistance, will now be in a strong position to enter as the price finds support over the next few weeks and reaches oversold levels.

This reckless US deficit spending may reap the whirlwind of higher inflation, a weaker dollar, and the loss of our AAA credit rating. An unintended consequence may be the abandonment of the US dollar as the world's reserve currency. Already the Russians and Chinese are in a pact to trade in their own money to protect themselves from imminent dollar depreciation.

Time and space do not permit me to discuss the deleterious effects of such items as earmarks, obscene bonuses, municipal government insolvency, and a list of the men and companies that got away with mere slaps on the wrist.

Perhaps well-chosen and carefully followed mining stocks and well-timed gold and silver purchases may offer a shelter from the approaching storm.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

Featured Videos