The gold panic selloff will continue. But stocks may join the fray this week.
Essentially, EVERYTHING is over bought...and with FED tightening...the "scarce commodity" is cash.
But the FED has a long long way to go before all the excess cash is drained from the system...and with an expensive and unfunded war budget, the deficits and the tax cuts, and with the deindustrialized US economy floundering in international waters with no hope of re-starting...
Still "virtual cash" is disappearing every day as assets from homes to stocks to bonds to commodities PLUNGE IN VALUE...so the "crash" is the FED's Friend! Never under-estimate the power of a crash to drain liquidity from the markets...suddenly the once despised "cash" looks very very good.
Just ask someone stuck with a house they can't sell!
BUT THE GOLD STORY IS NOT DEAD.
Gold simply became a PANIC BUY this year...and now it has to become the PANIC SELL.
AND THAT MAY TAKE A WHILE! THE TRUE BELIEVERS, LIKE MYSELF, WILL NOT SELL UNDER ANY CIRCUMSTANCES...
THE NEWBIES AND SPECULATORS ARE SELLING HAND OVER FIST...AND LOSING MONEY ALL THE WAY...AS IS APPROPRIATE FOR SPECULATORS.
But all the hot money is not out of the gold market yet...it may have to retrace ALL OF IT'S GAINS...BACK DOWN TO $390 OR LESS.
SO IT'S STILL A LONG WAY DOWN...AND CD's ARE GETTING MORE ATTRACTIVE BY THE DAY...AS THE FED SIMPLY WILL NOT BE "ALLOWED" TO STOP RAISING RATES.
THE VERY MINUTE THE FED STOPS THE RATE HIKES GOLD WILL SOAR BACK UP...!
THE GOLD PANIC CONTINUES...CASH IS KING...THE FED HAS IT'S MARCHING ORDERS...MAYBE IN A WEEK OR SO OF CURRENT PANIC SELLING...GOLD WILL BECOME A "NIBBLE" AGAIN.
WATCH THE FUN AND GAMES...!
