Friday, January 17, 2014

Questions for those Wall Street Whiteys who've suddenly decided to buy gold

Apparently even CNBC is saying gold is a buy now. Big change from a week ago, eh?

So, here's a question for Wall Street Whitey, who regularly reads my blog:

Are you buying gold because

1) real rates are going negative?
2) the US economy is about to collapse?
3) the US deficit is increasing?
4) the Federal Reserve is increasing their money-printing?
5) you fear an imminent disaster or military conflict?
6) the US dollar is about to collapse?

Because those are about the only answers you're allowed to give, unless you're willing to admit that you're fucking wrong about everything and Whitey has absolutely nothing to do with the price of gold.

Really, I would truly love to hear the lily-assed white boys on Wall Street try to explain, within their conceptual paradigm of gold, why gold would be a buy right now, and why you should be in such a fucking rush to buy good miners like BTO and RIO, as well as shitty unprofitable fraudulent miners like 90% of the GDXJ, that you're willing to push them +3SD.

The fact is, Wall Street has no fucking clue what's going on here.


  1. Yeah, I am shaking my head too...could not give Rio away a few weeks ago at $1.50 now they can't get enough at $2.40. Same goes with Timmins couldn't sell it at $1.20 then I watch 300,000 shares get taken out at $1.59 today in 5 minutes.

    The fundies sell off hard when it is OPM and buy back recklessly with their money also.

    What has changed besides relief from tax loss?

    1. Gold is above 1250 and is not staring 1150 in the face any longer, which was the case during the weeks before Christmas. And I remember a lot of talk about gold going to 1000 and which miner would be profitable at such a gold price. Gold is now a buy according to JP Morgan who apparently did a lot of buying before Christmas.

      Still I would attribute most of the recent gains to a tax loss relief rally which will ebb out sooner or later. Will be interesting to see what happens if Gold embarks on a new tour towards 1200, but fundamentally I don't see much wrong with Rio at 2.40, 1.35 on the other hand was outrageous and a gift.

  2. The amount the stocks went up was surprising considering gold was up just over $10 and $1250 is not that that big of a technical hurdle. We had stock / index / etf option expiry Friday but the action was not typical of opex. Everything got bought, even the shit. Maybe unwinding of shorts before the US long weekend?

    1. Either that or people in the know are getting ready for a pop in gold.