Tuesday, August 9, 2016
Jojo's still around
I saw some traffic from a goldbug blog yesterday, and that led me to being reminded that Jordan Roy-Byrne still exists. Sorry, I just haven't been paying attention to the goldbug world at all recently.
Anyway, he says this:
Get back Jojo! - gold and gold stocks bull analogs. Where he says this:
Which would be nice and all, except for the caveat that there's no reason this time has to be like last time. Gold is just a dumb commodity, after all; it's just that the Chinese and the Indians and the kleptocratic elite are constantly buying more of it because their wealth is constantly increasing, and now Wall Street Whitey has come back into the game.
Jojo thinks gold miners are extended to the upside right now, but then again gold miners should be extended to the upside if Wall Street Whitey is piling back in with anything approaching the same ferocity at which they piled out over the past couple years.
I mean, assume the market expects gold to continue going up from here. Then, if people are buying gold stocks in expectation of future earnings and not present value, then of course the equities should lead the underlying market. I mean hell, broad equities led the underlying US economy out of March 2009, right? That's just what happens: expectations make equities lead the underlying condition.
As far as buying the smallest juniors is concerned:
Remember how they were all a bunch of worthless pumpers of moose pasture at best, or outright criminal fraudsters at worst? Remember how Cookie says there's not really any easy gold left to find? Remember things like political risk and equity dilution?
None of that's changed.
If you get into venture explorecos, all you're doing is trying to play a coming pump-and-dump hype. And maybe the hype will come, and there's nothing better than making a one-week 50% win on some piece of pump-and-dump garbage like Golden Hope. But there's easier money to be made.