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Guest Post: Gold Surging - Buy Mining Stocks? Not So Fast, Says Frank Barbera

Tyler Durden's picture


Submitted by Chris Martenson

Gold Surging: Buy Mining Stocks? Not So Fast, Says Frank Barbera

With the astonishing recent price rise in gold, many investors are asking themselves: is now the time to move capital into mining stocks?

Frank Barbera, respected precious metal mining stock expert and editor of the Gold Stock Technician newsletter, has a viewpoint that will likely surprise many. While extremely bullish in the longer term, Frank sees too many risks in the near term and advises smart money to wait.

He cautions:

"I’ve been watching the mining stocks since 1983 so a fair amount of time that I spent watching the group. I have a wide variety of unique technical indicators on the sector and as I started to see the stock market topping out over the last two to three weeks I wrote my readers a note to say the mining stocks are also very overbought. Mid July we saw one of the second most overbought readings on the XAU, on the arms index in five years. And that kind of reading is a big warning and so I’m not surprised to see them going down. The last letter I put out I told subscribers that I thought the mining stocks could get cut in half in here and I’m going to stick with that. I think we’re looking at a 30 to 50 percent decline over the next six months. The XAU, which recently peaked out at around 220, I think you could see that close to 110 before this decline is complete.

So, now, why is that? Really, the truth seems to be that a lot of these assets have been very, very highly correlated and that mining stocks are a "risk on" asset. Now there are a lot of very competent analysts out there that have been strongly recommending them, pointing to the idea that the stocks are, quote, "cheap". When you look at Barrick Gold or Newmont Mining you see 13, 12 times earnings, multiples relative to cash flow that are near multi-decade lows. I don’t disagree with any of that. I think that the mining stocks are a great value on the fundamentals.

On the other hand the equity market looks like it could be heading for a very substantial decline and I think that mining stocks – they have not shown the ability, at least not yet, to decouple from the equity market. Now, clearly nothing is cast in stone and I sort of evaluate this day to day but, you know, if you look at the past data it really suggests that they’re going to get hit if the market goes down.

And, at some point I think what you’ll see is I’m looking for a bear market in equities over a period of a couple of months. I think during that period of time you will see gold go through the roof, the physical metal. I also think you’ll see some nice upward progress in silver. I’m in the camp where I think silver is going to act like a monetary metal. Sure they may pull back here in the short term but I think there’s a real opportunity there for silver to turn the corner especially if we get another Jackson Hole special come the end of August with Dr. Bernanke and more QE. I think silver will light up like a firecracker. But, the mining stocks, they need to simply fall to a bigger discount to the underlying metal. And, at some point then if we end up getting into a really strong dollar movement of the downside I think that’s when you might down the line a bit you see the mining stocks turn.

Now I also want to make another point that’s very important. I think that ultimately this shakeout in the mining stocks, we don’t have to put numbers on it but let’s call it a substantial decline. Once that decline is over I think they will reach a low probably into the first quarter of next year in 2012 and from that point I think you’ll see a multiyear bold market in the mining stocks where they play catch up to where they should be and then to where metal prices will be. So I think that it’s going to be very volatile and right now they’re decoupling and that decoupling may stretch out dramatically but then they’ll eventually catch up. So I still see an enormous opportunity there but I think that mining stock investors may have to wait awhile to capitalize on that opportunity."

Also in this interview:

  • How the technical charts for the dollar are signalling increasing risk of a dramatic downside breakdown in the second half of 2011
  • The growing risk of the European crisis to further roil the currency markets
  • Multi-currency strategies for the individual investor

Click here to listen to Chris' interview with Frank Barbera (runtime 40m:45s):

Report a Problem Playing the Podcast


Or start reading the transcript below:

Chris Martenson: Welcome to another podcast. I am, of course, Chris Martenson and today we are talking with Frank Barbera one of the top experts on precious metal mining companies and editor of the very well respected Gold Stock Technician newsletter. In his analysis for investors, Frank overlays a macro outlook on top of a highly rigorous technical analysis and employs a market-timing approach to reduce the inherent volatility within this very high beta sector. So for many years now, Frank has also managed private equity capital most notably for the Caruso Fund with particular focus on precious metals, energy, currencies, all things of, I know, intense interest to our listeners here. Frank, we’re delighted to have you here. With all the recent action in gold, we have a lot to talk about.

Frank Barbera: You bet Chris. Thank you for having me.

Chris Martenson: Oh, my pleasure. Now, you know, gold’s up a 180 dollars an ounce since early July. What do you see as some of the key drivers behind this? You know, how much momentum does this run up have in your estimation?

Frank Barbera: Well, strangely enough, you know, I know there are a lot of people out there who are saying that gold could be a bubble and that maybe it’s going to come down sharply. Right now, I would strongly disagree with that. I think when you take a survey of what’s going on in the world and you look at Europe. Europe is in the midst of a major banking crisis, a banking crisis that could have widespread contagion from not only Europe but back to the United States through the credit default markets. And the U.S. also has, as we’ve seen now, major debt problems and a very difficult situation in terms of an economy that seems to be relapsing back into recession and that, once again, is putting massive pressure on the Federal Reserve to try and do something to ameliorate what looks like is shaping up to be another hard landing. You look at all of these factors and what it adds up to is gigantic uncertainty. And it is that uncertainty which is under painting the move higher in precious metals. Another important point which your listeners should really take into consideration is the fact that this is a climate where because global growth is slowing, short term interest rates especially here in the United States are really locked at zero.

Now, depending on what metric of consumer prices you want to look at – let’s say we take this fairly horrible CPI that’s constructed at 2% inflation. Right now you have negative real rates in the United States. And if you go back over a historic period of time and you look at negative real rates and the price returns on gold, gold does very, very well as long as short term rates are in negative territory. Now when short term rates are normalized and they move above the rate of inflation that at that point can become a problem for gold. I don’t see any way that that’s going to happen for the longest period of time especially when you start to look at some of the recent economic data that’s coming out of the States. We see very weak employment. We see GDP backward revisions as far as 2003; they went back just recently to downwardly revise the GDP data, the recent quarter coming in at about 0.38 with final demand at around 0.08. So you have a comatose growth situation here in the United States. No growth, chronically high structural employment - that is a situation where it’s impossible to see how short term interest rates are going to start to move up. So I think negative real rates are here to stay and gold will continue to surge.

Right now, Chris, the other thing that’s really amazing about all this is like you said, we’ve had this strong move up in precious metals prices, in gold prices. But remarkably, from a technical point of view we really have not seen any kind of bullish enthusiasm. It’s slowly starting to creep into the market over the last day or two but I look at dollar-weighted call-to-put options data each day and that tells me a lot about how much money is flowing into calls and how much money is flowing into puts. And, right now, even though we’ve gone to $1660 on the gold price we have not seen those call-to-put ratios move up to readings near two and a half or three to one, which would typically tell us we’re getting into a frothy market. They’ve been hovering around 160, 170, and that tells me that there’s still plenty of room to go. Also, on a momentum basis, if you look at moving average convergence, divergence, which is called MACD or RSI. We’re seeing strong momentum confirmation by the move up in the precious metals - outstanding relative strength. To me this tells me that gold could easily surge in coming weeks towards the 1800 level and I have really very little doubt in my mind that we’ll see 2000 over the next two to three months. So I think the price is going sharply higher from here.

Chris Martenson: So against that though we see that the USD is up about a full tick today, up almost 1.4% at 75. It looks like a decent pop for the day but it seems almost maybe stuck in a range. How are you looking at the dollar now which is the anti-gold?

Frank Barbera: Well, that’s a good point and I’m glad you brought that up. The one caveat I would have with gold in the short term is that you could see a very short-lived pull back. So this is not something that I think investors should really be terribly worried about but I could see something, for example, like the GLD pulling back towards maybe the 155 to 160. We’re at 160 right now but about the 155 to 156 area. So you could have a couple more days of strength in the dollar and you might get a few more days of short-term weakness in the gold price but I think within a couple of days were going to make another low in the gold market and then from there the price will turn higher and begin another large trending move to the upside. So in the very short term I do think we’re going to see a little bit more dollar strength. The dollar index is at about 75.02 as we speak here on a Thursday morning up about a buck. I think you could see a push up towards about 77.5 maybe 78 over the next four to five days.

And, now there’s one other little caveat. The dollar is showing a very, very weak pattern. When we talk about poor quality rallies this is really the textbook definition of a poor quality rally. So I’m not really that sure that we’ll even make a move to 77 but I’m allowing for the possibility that it could do that over maybe the next week or so. That could correlate to some kind of a short-term period of weakness in the gold price and at that point then I think we’ll probably start to see signs of a reversal back to the downsize in the dollar and a reversal back to the upside in gold. So, you know, one of the things I would really recommend to listeners is to not worry too much about short term moves. This is one of those times you really have to think big picture. If you’re very concerned about getting the best price, break up the capital that you have into smaller increments and dollar cost your way into the market in stage tranches because trying to put too fine a point on any of these markets right now is not the greatest idea. But, for what it’s worth I do think we’ll see a little more bounce in the dollar and short term pullback in gold and then I think gold will reverse higher. 

Click here to read the rest of the transcript.


Note: Listeners interested in the conclusions expressed within this interview will also want to read Chris' recent report on The Screaming Fundamentals For Owning Gold And Silver, which takes a deep dive into the data behind the supply and demand imbalances in the bullion markets.


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Tue, 08/09/2011 - 00:29 | 1541262 The Peak Oil Poet
The Peak Oil Poet's picture



when all is falling 'round our ears
and markets crash and burn
it's saftey that you cherish most
it's not a "sound return"

Tue, 08/09/2011 - 00:36 | 1541293 hedgeless_horseman
hedgeless_horseman's picture

The heights of great wealth
reached and kept
were not obtained
by sudden flight.
But we, while our
companions slept
where reading Tyler
in the night. 


h/t Longfellow

Tue, 08/09/2011 - 00:39 | 1541313 egdeh orez
egdeh orez's picture

While I shared the same wariness toward gold mining stocks (and it's correlation to all risk assets), I think he should also consider the fact that the price of physical gold is now decoupling from other risk assets which it was unable to do during the '08 crash... so this time might be different.

Tue, 08/09/2011 - 00:47 | 1541339 Spitzer
Spitzer's picture

Thats right.


Did this idiot asshole miss today ? where was he ?

I was expecting a bloodbath too, and I didnt care because physical was sky rocketing.

With all this money sloshing around, gold miners will get a bid. China is probably about to go on a buying spee.

Premier Gold +10.27%

Agnico Eagle +3.21%

Yamana +3.71%

Eldorado +5.66%

Tue, 08/09/2011 - 00:57 | 1541364 BaBaBouy
BaBaBouy's picture


The mining stocks have been in decline since March.


My bet is its the seasonality stupid.

We may go down a bit more here, then the real bull market starts into next year, normal PM Stocks seasonality.


$2000 GOLD will help a lot too...

Tue, 08/09/2011 - 01:06 | 1541386 Spitzer
Spitzer's picture


Tue, 08/09/2011 - 01:05 | 1541392 Spitzer
Spitzer's picture

The mining stocks got a safety bid on August 8 2011 when the whole fucking world was collapsing.

The cost of mining is falling, look at crude.

Tue, 08/09/2011 - 01:19 | 1541423 Michael
Michael's picture

Rollover-1981- Depiction of Global Worldwide Economic Collapse in 2011

Tue, 08/09/2011 - 01:55 | 1541484 Raymond_K_Hessel
Raymond_K_Hessel's picture

Exactly, the miners dig up gold, which has gone up $200/oz while the miners have fallen, and we're supposed to wait for a better entry? I mean if GDX was almost $60 two weeks ago when gold was around $1,540, how can it only be worth $55 now that the price is $1,740? Oh, and as you pointed out, oil, one of the major costs associated with mining is down hard. So the production costs are falling and the product they're selling is skyrocketing but I shouldn't buy because the charts don't look right?

Tue, 08/09/2011 - 01:40 | 1541463 caconhma
caconhma's picture

<When you look at Barrick Gold or Newmont Mining you see 13, 12 times earnings, multiples relative to cash flow that are near multi-decade lows. I don’t disagree with any of that. I think that the mining stocks are a great value on the fundamentals.>


Let us see

·         ABX and NEM have PE 12 and 10 @ gold prices of ~$1500

·         Consequently, @ gold ~$2,000 the same PE will be 8 and 6


As of the last weekend, neither euro nor US$ nor US treasuries are “the safe havens” any more. Only gold left with the FED are printing and printing.


Now, maybe I am an idiot but in my opinion the “big WallStreet games” are over and markets will go back to the economic fundamentals. As of today, gold mining companies have the same market values they had when gold was `$1,100. Now, gold is almost 60%+ more expensive. In other word, gold mining companies are priced as if gold will go back to $1,000. This possibility is out of question!


With PE ~6-8, gold mining companies will be hugely attractive. Fundamentally, we are looking at one in a lifetime opportunity!



Do his charts show where gold will be 3, 6, 12 months from now?

Tue, 08/09/2011 - 06:01 | 1541640 Snidley Whipsnae
Snidley Whipsnae's picture

"In other word, gold mining companies are priced as if gold will go back to $1,000. This possibility is out of question!"

I am long physical. That said, never ever ever say 'this possibility is out of the question', regardless the context.

I can point out a simple scenario where gold could get clobbered any day, of course I hope this doesn't happen. Suppose for a moment that the Fed sees it's mandate evaporating if the dollar goes to zero or near zero purchasing power. Suppose the US Treasury believes that the US Gov will collapse if the purchasing power of the dollar goes to near zero... What would they do? Well, one thing they could do, but probably won't, is jack interest rates Waaaay up. That would definitely constrain the price of gold. It would also collapse what remains of the US economy.

So, never say never... We don't know what any Gov will do to prevent repudiation by it's citizens.

...and I have yet to find a crystal ball that works...

Tue, 08/09/2011 - 01:42 | 1541467 rosiescenario
rosiescenario's picture was an acid test, so to speak...

Tue, 08/09/2011 - 01:18 | 1541422 rosiescenario
rosiescenario's picture

Agree...we may learn more tomorrow as HL should report before the open...their earnings should be very good so we may see how they get treated in what should be pretty terrible market conditions.


Here's another factor that is going to influence the mining stocks going forward. If silver and gold keep going up, the miners are going to be minting money....and that is going to lead to many buyouts of the smaller miners by the bigger ones...I have been an investor in mining stocks for 40 years...the levels we will be seeing in silver prices will drive the companies producing the metal...what are investors going to do with all the cash they end up with from selling? Buy bonds??? No, they are going to be buying mining stocks...and they will be competing with other mining companies also buying out companies....far quicker and easier than prospecting and then trying to get a new mine up and operating.


I also think that the people who have already bought the PM miners are not like the momo types who buy Netflix and do not know what they actually own...they only want to be on a north bound train. Investors in mining stocks are buying earnings but even more importantly they are buying the PM in the ground, waiting to be mined and refined. It is a very different mind set.




Frankly if this guy is right and the mining stocks get whacked, I will be buying more and also using options, because this will accelerate the buyouts sure to come in this industry.

Tue, 08/09/2011 - 01:25 | 1541438 Spitzer
Spitzer's picture

There will be QE 3, if there is not then supply lines will be shut and tanks will be in the streets and people will starve.

Gold mining stocks will ride the QE3 wave.

Tue, 08/09/2011 - 06:10 | 1541646 Snidley Whipsnae
Snidley Whipsnae's picture

Perhaps QE 3 Lite, Perhaps undisclosed purchases of treasury issues, equities will be sacraficed on the bond alter. History is on my side.

Of course there will be token intervention to prop up equities... but it will be a sham and shortlived.

Right now is the time to be physical... paper is on fire.

Tue, 08/09/2011 - 01:50 | 1541479 FreedomGuy
FreedomGuy's picture

A large part of my portfolio is in mining stocks and funds. It seems to me that as metals prices rise while production costs decrease, i.e., energy prices, labor, etc., that their margins should blossom. In the short term they may get sold to raise cash. Today they did not follow the market down all the way.

So if the underlying asset is rapidly appreciating while the production costs are steady or dropping their should be a stock appreciation, right?  where am I wrong in my reasoning?

I personally don't get the decoupling of the mine stocks and metals prices. Nothing in this article tells me WHY mining stocks might or should drop 50%. Hell, the market is in free fall and it is not yet down that much.

Tue, 08/09/2011 - 02:01 | 1541494 Spitzer
Spitzer's picture

The value is already there, it has been for some time. It is there for the taking.


Tue, 08/09/2011 - 03:08 | 1541560 New World Chaos
New World Chaos's picture

Fears of nationalization, or perhaps naked shorting to indirectly manipulate the price of gold?

Tue, 08/09/2011 - 06:07 | 1541645 Snidley Whipsnae
Snidley Whipsnae's picture

FreedomGuy... How many times did you hear 'get out of paper gold products and paper in general'?

How many times did you hear 'trying to play with leveraged paper, or unleveraged paper, in front of an onrushing locomotive is insane?

How many times did you disregard this advice?

Why are you whinning now?

Hey, I got kicked off several sites because I advised people to 'get out of paper now'! You think I feel sympathetic toward those that laughed at me and then kicked me off?


Tue, 08/09/2011 - 06:38 | 1541664 whopper
whopper's picture

Frank Barbera huh.....I used to listen to that guy years ago on Financial Sense radio. He looks at charts and that is it. He was wrong so much he got deleted. The guy reads charts.....the chart says.....patterns.....Those folks are looking at the past. Sure the charts might be right, but so is a dart. You really have to watch all the assholes with their opinions in this biz. 

Tue, 08/09/2011 - 02:02 | 1541495 The Peak Oil Poet
The Peak Oil Poet's picture


the night brings tokens of the day's surpise

but the efforts in daylight are the acts of the wise

the PoP

Tue, 08/09/2011 - 05:47 | 1541630 janus
janus's picture

half a league/

half a league/

half a leage onward/

into the valley of death charged the six hundred...,


and away we go,


Tue, 08/09/2011 - 06:13 | 1541648 janus
janus's picture

oh, and hedgeless, there's this "parable" in the NT about this bloated and turgid mushhead who thinks himself all fat and dandy.  well, this blighter decides to rig markets and gather all things unto himself; and that's not playing the game, is it? anyway, cheating has it's spoils, no doubt -- but it's a bitter cup.  so, anyway, this disease was of the acquisitive sort, and got lots by hook and crook in that the NT it says he built up store houses, blah, blah, blah.  anyway, the story concludes true to form: bad shit happens and "this day your life will be required of you"  says The Word to the plague...and so he died, and the people did feast at the storehouses and marry his daughters.  True story.

and there's also this other "parable" about this no-account, slack-jawed rube who was given a talent..terrified of a stern master-market he goes and hides it under a rock.  if you're about to guess, "the rube gets thrown into the pit of darkness where there will be weeping and gnashing of teeth."  you are either a student of Scripture or you know how stern master-markets go.  anyway, the others that took the gift of the talents and multiplied their masters holdings (good stewards) were rewarded with 5 and 10 cities to rule over and abound therein in concubines, respective to their relative success and prowess with concubines.  and so the moral of the story is: janus is thinking he should be a trader.

Tue, 08/09/2011 - 00:33 | 1541283 Dave Thomas
Dave Thomas's picture

Better not, it only takes $5 bucks to dig it out of the ground. Or was that silver? OK $17 bucks to dig it out of the ground.

Tue, 08/09/2011 - 00:34 | 1541285 zorba THE GREEK
zorba THE GREEK's picture

_perfect timing for the article. I was calling my broker in A.M. to make major investment in GDX & GDXJ.

Now I will wait for better entry point.

Tue, 08/09/2011 - 00:34 | 1541288 time123
time123's picture

Gold is one of the only investments that has been rising constantly over the recent months, and years, including now that we are in bear market territory. It was featured again this week for those who pay attention. Its futures are hitting 1770 as we speak, well on its way to $6,000.



admin at

Tue, 08/09/2011 - 00:35 | 1541294 Count Laszlo
Count Laszlo's picture

This is wrong. There will be a world economic collapse of epic proportions. Smart money is already, and has been, in effect for valid reasons. Anyone to think world governments will figure this mess out are illusioned. It's reboot time kiddies. Plain and simple mathematics.

Tue, 08/09/2011 - 00:37 | 1541299 Hugh G Rection
Hugh G Rection's picture

In times like these, I don't trust anything paper. Sorry mister, za mine has been nationalized, you have zero equity serf.


Guns Gold Silver...and a lot of ammo

Tue, 08/09/2011 - 00:38 | 1541305 Segestan
Segestan's picture

Buy before the ' experts' tell you too. They , the expert, will have already entered while gaining from you're waiting. This guy is a tool. Miners have been used, manipulated  just like silver.

Tue, 08/09/2011 - 00:40 | 1541319 Spitzer
Spitzer's picture

Giveaway PE's for fuck sakes

Dividends that pay more then fucking bonds

They held up all day today.


Tue, 08/09/2011 - 00:46 | 1541338 Ponzi Unit
Ponzi Unit's picture

Yes, out of all equities and commodities last week, holding only that small portion consisting of dividend payers, using a 5% filter.

Tue, 08/09/2011 - 01:27 | 1541439 rosiescenario
rosiescenario's picture largest investment, a silver miner closed the day dead flat....not too bad today.


Wait until the buyouts start in the PM miners....that is coming next.


Personally I do not think using technicals is a good way to invest in mining stocks. I look at reserves and the operating costs (margins). You also need to pay attention to where the mine is located, obviously.


Most of the reported analysis on the miners just shows the analysts are really behind the curve on the earnings that are going to be reported soon.



Tue, 08/09/2011 - 00:42 | 1541326 baby_BLYTHE
baby_BLYTHE's picture

Just buy physical gold bullion. Equities are totally manipulated. Don't play into the Hedge Fund hyenas' trap.

Sitting out the BS fraud/manipulation in the markets and simply holding physical gold bullion has been the absolute winning strategy since March 2009.

Thanks to Jim Rogers, Marc Faber, Peter Schiff, Tyler Durden and others for informing us novices of this winning strategy.  

Tue, 08/09/2011 - 00:43 | 1541330 HungrySeagull
HungrySeagull's picture

Gold is already hitting 2000 for spot plus and asks exceed 2500 tonight.

Tue, 08/09/2011 - 00:46 | 1541337 baby_BLYTHE
baby_BLYTHE's picture

damn fucking right it is

Tue, 08/09/2011 - 00:50 | 1541349 Ponzi Unit
Ponzi Unit's picture

?  12:48 EDT  or do I miss the sarc...

Metal Bid Ask     Gold $1,757.40 $1,759.40 $44.20 Silver $38.85 $38.95 ($0.55)
Tue, 08/09/2011 - 00:55 | 1541359 baby_BLYTHE
baby_BLYTHE's picture

ya, he is just playing. A bit early by a week or two. 

Tue, 08/09/2011 - 03:21 | 1541566 Spitzer
Spitzer's picture

Medusa Mining trading in Australia  MML  +2.34%

Tue, 08/09/2011 - 08:00 | 1541871 disabledvet
disabledvet's picture

awwwww. you have a shine on!

Tue, 08/09/2011 - 00:43 | 1541328 Ponzi Unit
Ponzi Unit's picture

"This is one of those times you really have to think big picture."


If Jim Sinclair is right in saying gold $1764 is a launch point, then the picture is going to get very big.

Tue, 08/09/2011 - 00:44 | 1541333 The Grifter
The Grifter's picture

Good read.  It might only take $5 to dig something out of the ground, but you'll never see the profits even if true.   Mining stocks = lose money, in good times and bad (like now), nothing worse than a gold miner selling you shares.   If it was so profitable they'd be stacking the metal themselves and telling you to kiss off.    Gold BTW appears to be heading for the same parabolic blowoff silver saw at the start of May - but it has to correct - this is TOO EASY.

Tue, 08/09/2011 - 01:02 | 1541383 Reese Bobby
Reese Bobby's picture

Way to make stuff up.  Stocks like GG & ABX have made the move in physical gold look insignificant over time.  Facts matter...

Tue, 08/09/2011 - 01:20 | 1541431 The Grifter
The Grifter's picture

OH REALLY.   What time frame do you speak of?

Wish I could post some charts here, but to say that ABX has outperformed GLD back to 2005 (using any chart you can dream up) would be an outright lie, the underlying has outperformed it by at least 2X.   Go peddle your miner shares elsewhere.

Tue, 08/09/2011 - 19:05 | 1544481 Reese Bobby
Reese Bobby's picture

Yes, really.  ABX was founded in 1983 and went public on the TSE in May 1983.  But its first full month on the NYSE was 2/87.  So try graphing that Sparky.


You conveniently ignored GG but pick any meaningful period for that one Skippy.


You stand corrected and can probably can sleep better now...

Tue, 08/09/2011 - 01:11 | 1541404 Spitzer
Spitzer's picture

All time high in gold miner negative sentiment.

We all know to buy physical here but what is the next best thing ? I would rather own gold mining stocks then physical silver.

Tue, 08/09/2011 - 01:28 | 1541441 The Grifter
The Grifter's picture

If I wanted to mine gold, I'd pan for it myself rather than buy a miner stock.  

Tue, 08/09/2011 - 19:07 | 1544487 Reese Bobby
Reese Bobby's picture

Please do head to the wilderness and pan for gold.  Ask somebody with a brain how it is done.  Finding work ethic will be your own personal challenge...

Tue, 08/09/2011 - 01:33 | 1541452 Schwetty Shorts
Schwetty Shorts's picture

Best to own it all. The fact the miners have held up this well through a collapse of this scale is reassuring... especially with whiffs of $2K gold right around the corner.  I don't see holding shares as being much of a gamble in this environment but we shall see.

Tue, 08/09/2011 - 01:42 | 1541469 Spitzer
Spitzer's picture

The only gamble is the stupidity of the rest of the world. If other investors don't close some of the value arbitrage gap by buying in, then they could fall. But that doesn't change the facts. The value is there even if it is not realized.


Tue, 08/09/2011 - 01:34 | 1541454 rosiescenario
rosiescenario's picture

I have been investing in mining stocks for 40 years and you are wrong. Bought DeBeers at $2.50 and was receiving $1 per year in dividends before it ewas bought out by Anglo....similar for East Rand Gold and Uranium and Rustenberg Platinum.


If you do not want to do any work on an investment, then just buy what the miners will sell to you...every ounce of silver you buy from Hecla goes to their bottom line as their cost is actually negative for silevr due to the associated metals.



Tue, 08/09/2011 - 00:45 | 1541336 choorles
choorles's picture

dont worry yourself with stocks.... this is a complete paradigm shift

anything denominated in fiat money is only worth the paper it is printed on

its time to forget about abstract values... buy phyzzzzical....

Tue, 08/09/2011 - 00:48 | 1541344 The Grifter
The Grifter's picture

PM raid in progress - stand by until the Bernank fires up the presses

Tue, 08/09/2011 - 00:50 | 1541352 kito
kito's picture

Why are the australian markets up

Tue, 08/09/2011 - 00:53 | 1541358 Stumpy
Stumpy's picture


Tue, 08/09/2011 - 01:01 | 1541377 Ponzi Unit
Ponzi Unit's picture

hmm, modest bounce:

Australian shares made a remarkable turnaround to be flat after falling as much as five per cent during the morning.

At 1445 AEST, the benchmark S&P/ASX200 index was up 2.8 points, or 0.07 per cent, at 3,988.9, while the broader All Ordinaries index was down 8.1 points at 4,048.6 compared with Monday's close.

Tue, 08/09/2011 - 01:11 | 1541405 Mr. Mandelbrot
Mr. Mandelbrot's picture

No worries, they're back in the red . . .

Tue, 08/09/2011 - 00:58 | 1541367 DeltaCharlie
DeltaCharlie's picture

Ah yes, I use to subscribe to Frank Barbera's newsletters and this guy gets it wrong 90% of the time. I lost money early on listening to this idiot. He's bearish on gold and gold stocks ALL the time.  I cancelled his rag when gold was at $1000... he still hasn't changed his tune. 

Tue, 08/09/2011 - 01:04 | 1541388 Ponzi Unit
Ponzi Unit's picture

...except that he's pounding the table for bullion -- so you fade him and sell? I doubt it. I like the phys, but not the shares. Used to trade GDX option spreads. No fun.

Tue, 08/09/2011 - 01:08 | 1541398 Reese Bobby
Reese Bobby's picture

Thanks for the color.  He sounds like a 3rd grader:  I like gold, but it could pull back, so you might want to dollar cost average in, unless you don't care about getting the best price...zzzzzzzzzzzzzzzz.

Tue, 08/09/2011 - 01:19 | 1541427 Mr. Mandelbrot
Mr. Mandelbrot's picture

Gold is for saving, not speculating.  It should comprise a sacred 5-20% of one's portfolio that is never touched except in emergencies.  In the case of monetary system reset, the idea is that a 10% physical gold holding will recapitalize in purchasing power terms most if not more of the 90% in fiat denominated securities value lost.  As for the allocation percentages, I'm crazy: 90% PM's, 10% physical cash.  It's served me well for years and would take a hell of a losing streak to undo at this point . . .

Tue, 08/09/2011 - 08:01 | 1541876 disabledvet
disabledvet's picture

but i was told he was the "barbera" in Hanna/Barbera. How could he be wrong with cartoons like that?

Tue, 08/09/2011 - 01:00 | 1541369 stateside
stateside's picture

Yeah and it only cost $.03 to produce a cancer pill that sells for $40 - what's the point?

Tue, 08/09/2011 - 00:58 | 1541370 Hysteria
Hysteria's picture

Glad to know Frank is not on board.  He'll add more fuel to the fire which will be the gap up days in the HUI starting... oh... tomorrow.  I see this rhetoric everywhere in the gold community: bullion good, miners bad.  Even here with the HUI consolidating ABOVE its 2008 highs.  Sentiment is so bad in the sector you'd think gold had fallen to $500.  I believe there is an "inverse bubble" in the gold community in this respect.  When bubbles pop, watch out.  In this case, I'm expecting a 100-200% move across the HUI within 12 months of breaking 610 on the index.  People who sell their miners now will be buying back into a vaccume at much higher levels shortly.  Yes, I am speaking my book, and my book is about to make me a fortune.

Tue, 08/09/2011 - 01:53 | 1541480 rosiescenario
rosiescenario's picture

" I see this rhetoric everywhere in the gold community: bullion good, miners bad. "


It is a simplistic answer generated by folks who do not want to do their takes a lot of work to find good, under priced mining also helps to understand how mines operate.



Tue, 08/09/2011 - 01:04 | 1541378 QQQBall
QQQBall's picture

Appx 25% of mining costs are what? and what are those costs doing? With higher PM prices, what happens to the NPV of the in-ground resources? What happens to the cut-off grades and economics?Again, with lower energy costs. The wild card is the USD... just universally hated and shorted - That's the kicker.>

Tue, 08/09/2011 - 01:06 | 1541394 Ponzi Unit
Ponzi Unit's picture won't be cheap for long.

Tue, 08/09/2011 - 01:16 | 1541414 Spitzer
Spitzer's picture


You are probabaly just an oil bull that got their ass handed to them today. Guess what, oil aint gold. I havn't touched oil with a ten foot pole since 2008.

Allot of these inflationists don't understand gold enough. I wonder how Jim Rogers is doing on hiw wheat futures....

Tue, 08/09/2011 - 01:56 | 1541485 rosiescenario
rosiescenario's picture

Are you talking open pit or underground?


HL actually has a negative cost for all the silver it produces....for example.

Tue, 08/09/2011 - 02:37 | 1541530 Havana White
Havana White's picture

And Yamana has a negative cost for all the GOLD it produces, and it produces a LOT of gold.  I own this one and five others, and a smaller amount of fizz.

Tue, 08/09/2011 - 01:04 | 1541389 Caviar Emptor
Caviar Emptor's picture

Rock - Paper - Gold...Guess who wins? 

As for mining stocks, they are paper. And we're experiencing global paper revulsion right now. In the end, when the Kool Aid wears off, it's just confetti with a baseline value quite close to zero when TSHTF 

Tue, 08/09/2011 - 01:18 | 1541424 Spitzer
Spitzer's picture

A physical mine is not paper.

Using your logic, a house is a paper investment because your title is on paper.

Tue, 08/09/2011 - 02:00 | 1541492 rosiescenario
rosiescenario's picture

...I'd give up on these guys...they just want to think simple...obviously if you really think PM's are either going to stay where they are now or go even higher, then you want to own the mining stocks...we'll be selling these folks the metal from our investments.

Tue, 08/09/2011 - 06:12 | 1541647 FranSix
FranSix's picture

The trump card in the gold mining stakes are that a well-run mining project can pay out princely dividends over and above the rate of inflation.  So if you take on your shares at the low, you obtain some price appreciation, but at the same time, obtain a dividend growth company.  In a grinding bear market, shares in any equity may underperform, so we have in one of the Grand Mega Bears gold stocks underperforming.  No surprise.

Gold mines have been promoted as a land-flip scenario.  They only have value so long as a mining major wants to buy in.  Or they only have value if they can merge with another company.  Or they only have value if they can prove up the ounces, regardless of the geology.  Or they only have value if they have an inherent speculative return with a low float and a potential run on the shares.  Or they only have value should the prospect be a clean slate large discovery within the first few drill holes.  Or they only have value if they are senior historic mining prospects with a long history of production.  This is all grandstanding for the most part.

The companies themselves have managed atrociously almost across the board by diluting the shares massively in a rush to engage in production or defining reserves before the gold price crashes.  A company in production is what is required with a clean operating record.  Or you can look at how Sprott does the investing, or somebody like Resolute Funds.  GDXJ can also be a guide to investing.(though GDXJ is technically composed of mid-caps)  

If you accept the world is NOT actually falling apart at the seams, and that deflation is in order here, and that gold is merely in the process of adjusting for inflation it will make a lot more sense that the hyperinflationary scenario.  The hyperinflation can happen, its true, but for now everything looks like massive deflation and eventual currency devaluation.

Tue, 08/09/2011 - 01:08 | 1541399 FranSix
FranSix's picture

The bad thing about the gold market is that you have to mine, refine and sell gold into the market before it can be swapped out or confiscated.  Gold miners' earnings are denominated in oz. of gold, their costs are denominated in currency.  Even Deutsche Bank entered into a deal with a real bonafide gold mining stock market dog to buy their gold.

So let's say that arbitrageurs are taking advantage of the softness in gold mining shares since the last six months, and throwing the money they "borrow" from markets at gold futures.  They'll be forced to buy back their i.o.u.s at the very close of the fiscal year, because they won't be able to roll over their bets.  It hasn't occurred yet, but may come on the gold price correction.

The simple analysis would suggest that an average of $2000/oz. is not out of the question. And as gold miners had mined gold with costs of $8/oz. U.S. prior to the devaluation of currencies against the gold price fix of ~$20/oz. U.S. during the depression, it may very well be some sort of currency devaluation or crisis which will bring the miners online, an exogenous cause.  

If say a miner has costs of exploration & development in the area of $800/oz. U.S. in contemporaneous times, this would be analogous to the depression era costs of ~$8/oz U.S..  What was once a penny is now a dollar, so what used to cost $8 may very well cost $800.  Some of the smaller miners with robust grades may have overwhelming free cash flow.

Tue, 08/09/2011 - 01:13 | 1541408 PulauHantu29
PulauHantu29's picture

I'd rather but the underlying metal PALL, SLV or GLD.

Good luck!~

Tue, 08/09/2011 - 01:20 | 1541430 Spitzer
Spitzer's picture


You call GLD or SLV underlying metal ?

Tue, 08/09/2011 - 01:16 | 1541415 slewie the pi-rat
slewie the pi-rat's picture

these are tough to call and it is a tough place to be wrong, especially with gold doing so well and silver hangin in there, BiCheZ, better than most "asset classes" and not letting anyone down thru this mayhem.

they head-faked me, recently.  when silver climbed up off the low 30's and broke 40, they danced, as did gold. 

then gold kept going, silver got tired, and the stocks went back down.  fast.  i didn't say to buy them, altho i thought they had put in a decent bottom, but i did like that they were moving with the PMs and confirming.  for a change.

stewart thompson will speak of his eploits in these areas from time to time, as in this, last week's "#21" from "graceland stewie" (Paste): 

Gold rises to $1635. GDX rises to $62. Gold declines a bit and GDX tanks. Gold rises back towards $1635 and GDX wallows around $57. Your individual gold stocks in many cases are below the highs of 2006! Between trips to the vomit bag, I want you to understand that there must be no limit to what you can endure on the horrific front lines of this gold stocks battlefield.

which is why they invented frisbee.

Tue, 08/09/2011 - 01:24 | 1541435 reefermadness
reefermadness's picture

Miners should hold back some gold and become their own central banks of sorts selling only into rising prices. 

Tue, 08/09/2011 - 01:35 | 1541456 slewie the pi-rat
slewie the pi-rat's picture

in the bears #7 video,  the big buyers in china are buying directly from the mines, already.  and in fabulous bear-logic, this means the gold will not reach the market thru the normal channels. causing shortages.   

Tue, 08/09/2011 - 01:34 | 1541447 Cult_of_Reason
Cult_of_Reason's picture

Rogoff: Fed Will Embark on QE3, Act ‘Decisively’

Federal Reserve policy makers are likely to embark on a third round of large-scale asset purchases, moving “more decisively” to secure the U.S. recovery, said Harvard University economist Kenneth Rogoff.

“They certainly should do something right away,” said Rogoff, a former International Monetary Fund chief economist who attended graduate school with Fed Chairman Ben S. Bernanke.

“Out-of-the-box policies are called for, especially much more aggressive monetary policy, however unpopular that may be,” said Rogoff, 58, a former Fed economist who like Bernanke earned a Ph.D. from the Massachusetts Institute of Technology. The Fed is “going to move more decisively,” Rogoff said.

Tue, 08/09/2011 - 01:46 | 1541475 macktheknife
macktheknife's picture

Okay - this is gonna be a Beachboys moment.  I have been watching Zerohedge for several years now - used to particpate, then didn't.  The threads now move so fast - and with this crash ongong- even faster.  So, like catching a wave- I want to get this up in start of a Gold thread, to see if I can ride the momentum, and get some good thoughts.  (On 4chan, I pose as a 15 year old showing tits - and this seems to work).   What I would like is an answer to how to decide on timing.  Anyone who has an idea on this- please contribute- but, what I am hoping to flag down - to pull over and pick up my hitchiking ass-  is people I trust her:  Turd,  Hulk, Cog Dis,  TMosely, and Do Chen.  Also, Mscraen who doesnt specifically know much about metals- but makes up for it in raw wisdom and style (has any ZH avatar ever proposed marriage to another Avatar?  a ZH first and would have the lesbos out in support):

I have been buying metals since 2003, steadily, relentlessly - and, as of tonight-  this probably is a cool million.    I need help- I really am asking for thoughts.  I dont want to rdie this up- and ride it down.  Who has some good thoughts- and I know this is changing hour to hour- but HOW to decide when to sell the whole ClamBake?   If the govenment suddelny intevernes and heavily taxes gold transactions, this thing will drop like a stone.    What I am asking for-  and  this is a lot like - for those old enough to remember the original-  this is like Commisioner Gordon flashing out the Bat Signal into the night sky -  CAN i ASK  Turd, Cog Diss, Hulk MsCreant, TMosely  Do CHen - to put up -in large letters - when they think it is getting close to cashing out time?   I recognize that a prevailing thought is to hold this until it all crashes, and the smoke clears- and that may be right- BUT, it may also be right to punch out as it reaches WarP speed.  I would appreciate advice.  THnak you, and Marcia Brady Thanks you.

Tue, 08/09/2011 - 02:10 | 1541505 choorles
choorles's picture

you do not want to swap physical metals back to fiat paper....

there will be a day when you should swap your metals for other stuff like realestate.. but that is not now.. the euro and the dollar are about to crash.. hold on tight to ur PM's

when everyone you know is asking to buy your PM's.. then it might be time to swap out... maybe bitcoin will be safe enough to use by then...but im sure you will find things to buy.. maybe even PM's could be used as standard currency by then

august is going to be a crazy month.. but if you wait for QE3 you will get alot more for your PM's

goodluck.. i found this great site for news

Tue, 08/09/2011 - 02:19 | 1541512 macktheknife
macktheknife's picture

Thanks, Choorles - I think I agree.  I also agree that switching high metals value- to undervalued real estate (there are some beautiful ranches in Oregon) is the good move.   Thanks for the website.

Tue, 08/09/2011 - 03:46 | 1541572 New World Chaos
New World Chaos's picture

Dump most of it for stocks and real estate when a large fraction of the developed world is back on a gold standard.  Slowly, the fractional-reserve scams will start again and gold will go down while the economy and real estate lending picks up.  The Rothschilds create generational cycles of trust during which they breathe out paper and breathe in the wealth of the trusting.  Oh, and nothing but the phyzz until we have a system that doesn't steal real estate and stocks so easily.  Hide it during the times of chaos and heavy taxation.  One of its functions is to teleport wealth out of a doomed system and into a new system that respects property rights.

Tue, 08/09/2011 - 07:04 | 1541717 Dagny Taggart
Dagny Taggart's picture

Trader Dan Norcini says the miners break out to the upside when we have new inflationary conditions (think QE) and tend to underperform in delationary conditions (think no QE). Turd has re-posted these thoughts from Trader Dan's blogspot. There are good forums on both gold and silver miners at too.

Tue, 08/09/2011 - 02:03 | 1541499 bob_dabolina
bob_dabolina's picture

Guess everyone is sleeping throught the massive rally

Tue, 08/09/2011 - 02:35 | 1541527 WoodMizer
WoodMizer's picture

Might be the new and improved international PPT.

Tue, 08/09/2011 - 02:18 | 1541510 thegr8whorebabylon
thegr8whorebabylon's picture

Marry me Mack. 

Tue, 08/09/2011 - 02:21 | 1541514 macktheknife
macktheknife's picture

Tits or get the fuck out  (4chan etiquette - but a man has to survive)

Tue, 08/09/2011 - 02:20 | 1541513 thegr8whorebabylon
thegr8whorebabylon's picture

Schiff says; "When gold = the dow, 1 oz = the dow, then trade for farmland."

Tue, 08/09/2011 - 02:29 | 1541523 macktheknife
macktheknife's picture

Meryl Streep begins narrating Out Of africa with the line,   " I had a farm in Africa, at the foot of the Ngong Hills."  

I think that is sublime- and I have a farm in Central Oregon - at a bend in the John Day River, and there are Appaloosas.  


Quite bizarrely - having that simplicity-  I am thinking of taking gold and silver profits- if I cash in - and trying to find some very underpriced property in Vegas or El Paso -  the part of me that is less Isak Dinesen, and more Mickey Rourke, on Meth, with the gentle side of Eric Roberts mixed in, and Steven Seagal's aging grace -I think you get my point - I am redeemable slime.   I know, for my loyal readers - it is near impossible to keep an image of Marcia Brady, ad all this in your  ind at the same time-  CALLING COG DISS.  I am actually a nice guy, and if MsCreant won't have me-   I'll go for the Babbling Escort.  Love you always.  MTK

Tue, 08/09/2011 - 03:14 | 1541532 thegr8whorebabylon
thegr8whorebabylon's picture


Tue, 08/09/2011 - 02:21 | 1541515 thunderchief
thunderchief's picture

Miners are the most suppressed end of the PM sector.  They have been bashed and shorted and held down during much of this rally.  It is the only paper side of the PM market that makes sense.  What an Idiot!!

Tue, 08/09/2011 - 02:23 | 1541516 Spitzer
Tue, 08/09/2011 - 07:48 | 1541831 machineh
machineh's picture

BINGO -- that's the ratio I was looking for in Frank Barbera's comments, but didn't see.

Ugly downtrend this year, eh?

I bailed on GDX last December when it started acting sickly vs. bullion.

Tue, 08/09/2011 - 03:14 | 1541520 thegr8whorebabylon
thegr8whorebabylon's picture



bumper sticker seen earlier on 0Hedge,  Picture of Obama, says, "Does this ass make my car look bigger?"  

Tue, 08/09/2011 - 02:39 | 1541531 macktheknife
macktheknife's picture

Whore - I like you - I havent seen you before on ZH (leans on edge of bar, elbow slips spastically off edge of bar)    You have spunk.    You know, WHORE, someday on sites like this- there will be a "Reality Feed" that shows us as we actually are,  - you are some guy who works at ACE Hardware, has a huge belly - but a certan attactive  

je ne sais quoi

(typed Je Ne say chois into google and got the right french) -    and I am a date rape parollee, living in a van down by the river- but on ZH, tonight, we can flirt as the WORLD BURNS!!!   Kiss me you big fat steelworker!!!  In your mind, and it is true,  I am Emma Watson  err thats my mind-  I am supposed to be the guy - ok in your mind I am Captain JACK SPalding, and you are Scarlett Johannsen.  Is this transitory?    WHores BITCHEZ.  McCreant - if you are reading this -  she is leading me on, look how she is dressed - SLUT!!!

Tue, 08/09/2011 - 02:42 | 1541534 nikku
nikku's picture

Tyler, Please reach out to the top newsletter writer in the gold mining sector, John Doody from (his 10 picks earned 120%+ last year). If he would let you publish his analysis on why gold stocks are outrageously cheap, everyone would understand what bullshit this guys views, short-medium term are. Peace --N

Tue, 08/09/2011 - 03:24 | 1541535 thegr8whorebabylon
thegr8whorebabylon's picture

I like your style too.

Tue, 08/09/2011 - 02:50 | 1541542 Jack Sheet
Jack Sheet's picture

Check out Bill Fleckenstein

He is adding to his holdings of Agnico Eagle.

Believe who you wish.


Tue, 08/09/2011 - 03:09 | 1541561 Jack Sheet
Jack Sheet's picture

Oh, and a nice little aside by Santa:


"5. Thursday and early today you may have witnessed the last great attempt of the Short Cabal to discredit gold shares.
6. Various member of the voluntary Short of Gold Shares Cabal are quietly looking towards the exit.
7. There are quite a few hedge funds now seeking quality gold share positions where the leverage might exceed the percentage leverage left in gold itself."


Tue, 08/09/2011 - 03:25 | 1541569 Spitzer
Spitzer's picture

Medusa Mining MML +2.6%

Tue, 08/09/2011 - 05:36 | 1541626 FranSix
FranSix's picture

August is the usual low for gold mining shares, and this august is no different.  Take any gold mining indece divided by gold over the short, medium and long term.  Gold mining shares have underperformed for an extended period of time.

Tue, 08/09/2011 - 03:29 | 1541549 thegr8whorebabylon
thegr8whorebabylon's picture

Moi j'ai quite mon payee blu, but still, Apaloossas at the bend of the John Day River sounds nice.  Vegas, not so much, unless you're aiming for a scene in The Stand.

Tue, 08/09/2011 - 03:24 | 1541568 Drag Racer
Drag Racer's picture

futures taking off like a rocket would tell me some kind of QE thing is a done deal...

Tue, 08/09/2011 - 04:54 | 1541605 BlackholeDivestment
BlackholeDivestment's picture

wow, DAX down 6% again


Tue, 08/09/2011 - 05:00 | 1541608 NoClueSneaker
NoClueSneaker's picture

German Trumpets Of Recovery ( all the german newspapers ) administred  the Hopium for breakfast / opening - Great Vomit as a result ....

Mission accomplished .


Tue, 08/09/2011 - 05:08 | 1541613 Drag Racer
Drag Racer's picture

well, that 'recovery' didn't last very long...

Tue, 08/09/2011 - 05:26 | 1541618 Arch Duke Ferdinand
Arch Duke Ferdinand's picture

*****Why Speculators Should Sell Their Gold Now

""looking back five or 10 years from now, this is likely to be viewed as yet another investment mania. (Bear in mind that in 2005, investors made up 16% of the demand for gold. Today, it’s more than 40%......""

*****OT: "Film Festival" Short

The Creek.....

Tue, 08/09/2011 - 06:24 | 1541655 Die Weiße Rose
Die Weiße Rose's picture

what, no live feed from the London Riots on ZH ?

no comments "?

 nothing much to do with economic crisis or disenfranchised youth ?

different from Greece , Portugal, Italy or irland ?

why are People so angry ? could it be the lousy economy and corrupt governments ?

Companies like News Corp pay little Tax and get away with murder,

If you got privilege, you get entitlements -

but If you live on skid row, you are just a criminal or some dirty left-wing socialist

who deserves to have no future and rot in Guantanamo or some other rat hole

I think I get it....People got to be born lucky and privileged to be worthy !

there goes another Empire !


Tue, 08/09/2011 - 06:32 | 1541660 jcrows
jcrows's picture

paper is the book someone else is pushing. get physical and sleep at night.

Tue, 08/09/2011 - 06:35 | 1541662 whirlybird rules
whirlybird rules's picture

Treasuries are slowly flatlining across the curve.  The dollar is up against the Aussie and Canadian.   Oil is down $20.  And the dollar is still on its back.  Sorry, the discussion above does not address the WILLINGNESS OF CERTAIN PLAYERS TO DESTROY THE DOLLAR, WHATEVER THE COST TO THE REST OF THE WORLD.  

Tue, 08/09/2011 - 07:03 | 1541713 eri
eri's picture

Frank Barbera?

Isn't that the guy who did Scooby Doo?

Tue, 08/09/2011 - 12:15 | 1542842 janus
janus's picture

that's sick...and no, i think his name was shaggy (nom de guerre)

Tue, 08/09/2011 - 07:05 | 1541724 eri
eri's picture

Frank Barbera?

Isn't that guy who did Scooby Doo?

Tue, 08/09/2011 - 07:45 | 1541823 paulypaul
paulypaul's picture

Keep you position in your smaller miners as its hard to get back in (silly spreads, small volume).

If you feel there is some down side risk, get the financials short ETF, for however long it is before its wound up.

Tue, 08/09/2011 - 10:12 | 1542309 Mises knows best
Mises knows best's picture

I'll take Hussmans gold stock indicator over Barbara's technicals.

123% annual return when all 4 indicators are present.  We are at 3 of 4 and the Napm came in at 50.9 last...below 50 and historically it is as close to a lock as we get in this business.


Wed, 09/14/2011 - 05:24 | 1667607 chinawholesaler
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