Jim Sinclair is the PM investors freind. Take his advice to heart and all these shakeouts will work to your advantage. Read this from Jim;
General Editorial
Thursday, March 24, 2005, 9:08:00 PM EST
Gold and Dollar Market Summary
Author: Jim Sinclair
Dear CIGA:
The case for the price of gold at $518 to $529 is made by the following article. Inherently the case for the USDX below .8000 needs only what this article reveals as so.
March 24, 2005
Price Increases by Companies Start to Stick
By EDUARDO PORTER
In recent years, most companies were forced to absorb the higher costs of basic expenses like employee health care, raw materials and energy, focusing instead on squeezing more efficiencies from their workers and machines.
But now, from airlines to manufacturers of advanced plastics, many businesses are overcoming their fears of losing customers and are starting to pass on cost increases.
After two months of virtually no inflation, the Labor Department reported yesterday that the Consumer Price Index jumped 0.4 percent in February, the fastest pace since October.
Surging oil prices contributed substantially to the increase last month. But other prices also rose broadly, pushing the core Consumer Price Index - a less volatile measure that excludes food and energy - up by 0.3 percent, the sharpest increase since September.
The report came a day after the Federal Reserve, in raising interest rates for the seventh time in less than a year, expressed greater concern about the risk of higher inflation, citing evidence that some businesses are gaining increased "pricing power" in the marketplace.
Including energy and food costs, average prices are now 3 percent above their level a year earlier. Some consumer prices have risen even faster.
More..
The top callers in the Gold Community are going wild today declaring their genius and in that ego-driven madness extending gold’s decline. The emails are falling as if from above declaring how correct they are and how despicable gold and silver are.
Their ill selected words would upset even the insurance investors as they pan the metals and sing the merits of the US dollar. No basis is claimed other than their arcane knowledge of lines, squiggles and a weak Jupiter.
Yet these sharpies always hang on to your purse strings by putting out the carrot that of course they are long term bulls. The implication is clear. You need only to worship them (that means sending money) and they will take you safely and profitably to the promised land of milk and honey.
Anyone following their imploring words and selling everything gold and silver will come to realize that they have followed false prophets who are out only to make a profit.
The top callers do not trade gold or silver or the US dollar for one good reason. They haven’t enough faith in their pronouncements. They know that they do not know. I know many of them and they are failed traders who tell you differently as skillful word smiths.
You buy this type of weakness in the metals and sell the strength never exceeding 1/3 of your position. Let the nuts flail all over the place as they are primarily financial accidents looking for a place to happen.
Gold is going to $518 and then to $529 and the above article is the last round peg in the round hole. There will be constant drama but in the end gold will be above $1650. ![]()
The greatest money will be made in the safest way and by following the simple approach: Buy weakness, sell strength, never exceed 1/3 of your position, and stay away from margin.
There is no need to hurry. You probably will have a few thousand chances before this is all over.
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Fed Chairman Paul Volcker once said: "Until there are put in place policies with a historical ability to reverse the growing deficits in the US budget, US Trade and therefore the US Current Account the value of the US dollar must continue to decline." ![]()