My little voice is now repeatedly kicking my brain in the crotch. Gold is now at $521.
That's up from $463 when I posted this.
You know what my little voice is saying now?
"Pssst. Double-Plus-Ungood. Yeah, you. Know that performance bonus you're about to get? Gggggooold. Buuyyyy goooollld. It's going up to over $700 because the US government has gone insane, the world's international order is collapsing, global tensions are rising, the US economy is being held up with popsicle sticks and gum, and the Chinese, Venezuelans, Russians, Saudis, and anyone else with a bit of cash, are buying up as much gold as they can. Chaos is coming. You can profit from it."
Man, I hate that little voice.
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4 comments:
On the other hand, consumer confidence is up, the Nasdaq hit hit record highs, the Nikkei is in good shape and more than 80% of all US corporations are having Christmas parties.
Saudis may be buying gold because they know that they're running out of oil. Apparently, they're responsible for some of the rise in price. Not coicidentally, two alternate energy-related stocks that I was interested in, Honda and Toyota, are doing well. Mutual funds that invest in the European market are doing surprisingly well. They're risky, as gold is, but risk isn't always a bad thing.
Are you talking about gold-oriented mutual funds or kruggerands?
Gold, the commodity.
Mary: On the other hand, consumer confidence is up, the Nasdaq hit hit record highs, the Nikkei is in good shape and more than 80% of all US corporations are having Christmas parties.
Read this:
More tangibly, the incorrigible optimists, as is their wont, are blithely ignoring the dark clouds plainly visible on the horizon. The great housing bubble is popping and the consequences are shaping up as dire, indeed. Not only is the value of the happy homeowner's house in jeopardy, but also obviously its ability to finance his free-wheeling spending; the end of the housing boom might even pose a threat to his job. On this score, the Anderson Forecast, conducted under the auspices of UCLA and released last week, bleakly predicts that the decline in housing will run a good several years, in the process reaping a grim toll on jobs -- possibly 500,000 in construction and another 300,000 in the financial sector.
Add to that potential sizable hit to both employment and the consumer's psyche such rather unnerving facts as that Detroit's in the ditch and hellbent on closing plants and handing out pink slips to its workers, whatever color their collars; that the federal government, on the basis of the first two months, seems a lead-pipe cinch to run up a $500 billion-plus budget deficit this fiscal year; that inflation continues to rear its insidious head, and you can see perhaps why we find it difficult to wax enthusiastic about next year's economy.
And let's not, as much as we wish we could, forget about energy. The recent perkier consumer mood and his greater willingness to consume has everything to do with the drop in gasoline prices. But last we looked, crude edged back over $60 a barrel and natural-gas prices shot up to a new all-time high north of $15 per mcf before easing off. Gasoline and heating oil are sure to follow. Sure to follow, too, are furrows and frowns on the consumer's brow and a desolate waning of the brief revival of his spirits.
Last but not least, gold continues to spiral upward, setting still another 24-year high as it closed in on $530 an ounce. Bullion's relentless rise, whatever is supplying the impetus, as we've lately lamented more than once, likely bodes ill for the economy.
To put it mildly, Abelson is kind of a glass-empty kind of person. Still, if you predict gloom and doom every day for decades, you're bound to be right sometime.
The optimists and the pessimists are saying similar things, they just see things differently. The housing boom is bound to plateau at some point, but that doesn't mean disaster. (Jane Galt mentioned that, if a slight housing slump is accompanied by a sharp rise in credit card applications, that's a bad sign). Oil prices are likely to stay high, which is why alt.energy is interesting but still risky. And, if the Saudis are running out of oil, and if they are buying gold, gold is likely to keep going up. Another risky but maybe good investment.
Abelson says:
The recent perkier consumer mood and his greater willingness to consume has everything to do with the drop in gasoline prices
I don't believe that's true. Fuel prices, especially the cost of heating a home, are still high, and it looks like it'll be a cold winter. People are still confident. Optimism isn't tied to only to oil/gas prices or only to gold prices. I'm not sure what it's tied to, but I'll be a pessimist like Abelson doesn't know either.
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