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The S&P is nearing 1560 - an all-time high.
If the S&P breaks 1560, will that drive the last few remaining goldbugs out of their meticulously-constructed fantasy world and into the harsh light of reality?
Will they all have to admit that a negro in the White House isn't a portend of the Rapture?
Will they finally see that the US budget deficit shrinks as GDP growth improves?
Will they finally give up waiting for the hyper-inflationary worldwide financial collapse and dystopian Mad Max future with the homosexual subtext?
Even worse...
If the S&P breaks 1560, will the goldbugs finally give up waiting, and sell all their shitty gold stocks?
Like all fantasy narratives, the doomer goldpocalypse meme can and will morph in whatever direction is needed to keep it alive. But I think it's had its day in the sun and the count of believers will dwindle over time. It might even lose it's grip on the republican party, who knows. They might decide they want to win the White House again in our lifetime instead of winning the hearts and minds of inbred dipshits everywhere.
ReplyDeleteLaughed at the Use of "homosexual subtext" as the anchor text for Tyler and the boys.
ReplyDeleteI would love to see GDP growth (and more importantly, unemployment rates) improve.
If that does indeed happen and the resulting follow-on increase in interest rates comes to pass, then whatever support the ZIRP-NIRP pillar had in the PM Bull story, will melt away. Real interest rate returns = sell gold.
Yeah but as I've been saying, if the US economy gets a boost, thus also improving economic performance throughout the world, that means more wealth creation in India, China and southeast Asia, which means more Asian gold demand.
DeleteAnd if the US economy improves, thus improving world wealth creation, that also means more increasing cash costs in the developing world where most of the gold (and copper and silver) is being mined. Gold only has a premium of ~30-35% over the all-in cash costs, which is lower than the premia for silver and copper; increasing cash costs can't mean a decrease in gold price.
Scrap gold does increase as the price goes up, but not enough to damage the price - that only happened in 2008 when a lot of wealth was destroyed and some people needed to liquidate gold.
If you think my thesis is wrong, please explain why.
I accept that the investment world believes the interest rates thesis and will sell based on it. But the most that can do is decrease the speculative premium.