Gold The Bright Shining Star
Today's climate of extreme fear sent Gold on its way to $1,000.00
Gold has been trending higher since mid October, but yesterday was the day it broke out of it's "ascending triangle" formation as money poured out of bonds and stocks into the shiny stuff.
I believe this particular security could have legs far beyond today's simple fear driven rally. Consider the following. Where is the money going to come from to bail us out of our current predicament? In a sense, we are going to simply print it. It isn't going to come from tax revenues.
When the market really catches on to how much we are going to have to print, the excess supply will bring back Mr. Bernake's next nightmare- the "I" word- INFLATION.
Yes, we could inflate our way out of this recession/budding depression. And, if we do, watch the Shiny Stuff make an 18 month move to who knows where. The old highs of $2,500 might not be a pipe dream. There is a whole sub culture of doomsdayers who have been calling for the end of the financial world for the last twenty years, and there's a possibility they might finally be right. The aging generation of gold bugs who long for the ra ra days of the '80's when gold was the only thing to own might have one more hey day.
As the storm clouds gather, you can't afford not to have GLD in your portfolio. I'm not ready to call a big move in junior mining stocks yet- they are huge cash gobblers, and there's no cash around for them to gobble up quite yet. Stand by on those ideas if capital starts to flow to juniors.
