“Gold is higher in the year 2012 for its 12th year in a row (up 9% this year, so far). This year investors have fed almost $8 billion into the most popular gold ETF — GLD. One advantage for gold is that interest rates are historically low, which makes the carrying cost of gold very low and attractive.”
“In fact, compared with the inflation rate, interest rates are in the negative column, and the Fed promises to keep rates super-low for the next two years or so.
China is the great unknown as far as gold is concerned. China is on the path to make the yuan a competitive world reserve currency. I’ve long felt that China will back its currency with part-gold. But gold today represents only 2% of China’s sovereign resources. To be a reserve currency, China needs two items: (1) lots of gold, and (2) a mighty military.
Below the important Shanghai index is semi-crashing.
I’ll just hang on to my gold, and as the various junk fiat currencies fade into history, gold will shimmer and shine brighter. In its long 12-year bull market history, gold has provided we “gold-bugs” with plenty of scares, but right now I’m more worried about the Yankee Dollar than I am about gold. As I write this morning, gold (not GLD) is down only 2.00 to 1693.80. It was down further earlier, but it may now be trying to base. We’ll see how it closes. The gold mining stocks have been a constant drag on gold. Unfortunately, the gold stocks tend to go with the general market.
Do you like to read charts? Below is the safe-haven US dollar. I dunno, if it was a stock, I don’t think I’d buy it. Look, it just closed below its 50-day moving average. That should have been support. MACD doesn’t look that good, either. I’d swap the darn paper for gold.
At the tender age of 88, it seems that I have, at last, found God. This means that I am learning to live in the present — minus all my worries about the future. And I can tell you, it’s a huge relief to be living without all my worries.
This way of thinking and acting has taken a huge strain off me. It will probably add ten years to my life. I no longer worry about a brutal depression that “may” lie just around the corner. I live in the present, and in the present I am aware and calm and dealing with the here and now. And right now there is no depression. If a depression or some other catastrophe arrives, I’ll deal with it then.”
Richard Russell
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About Richard Russell
Russell began publishing Dow Theory Letters in 1958, and he has been writing the Letters ever since (never once having skipped a Letter). Dow Theory Letters is the oldest service continuously written by one person in the business.
Russell gained wide recognition via a series of over 30 Dow Theory and technical articles that he wrote for Barron’s during the late-’50s through the ’90s. Through Barron’s and via word of mouth, he gained a wide following. Russell was the first (in 1960) to recommend gold stocks. He called the top of the 1949-’66 bull market. And almost to the day he called the bottom of the great 1972-’74 bear market, and the beginning of the great bull market which started in December 1974.
The Letters, published every three weeks, cover the US stock market, foreign markets, bonds, precious metals, commodities, economics –plus Russell’s widely-followed comments and observations and stock market philosophy.
In 1989 Russell took over Julian Snyder’s well-known advisory service, “International Moneyline”, a service which Mr. Synder ran from Switzerland. Then, in 1998 Russell took over the Zweig Forecast from famed market analyst, Martin Zweig. Russell has written articles and been quoted in such publications as Bloomberg magazine, Barron’s, Time, Newsweek, Money Magazine, the Wall Street Journal, the New York Times, Reuters, and others. Subscribers to Dow Theory Letters number over 12,000, hailing from all 50 states and dozens of overseas counties.
A native New Yorker (born in 1924) Russell has lived through depressions and booms, through good times and bad, through war and peace. He was educated at Rutgers and received his BA at NYU. Russell flew as a combat bombardier on B-25 Mitchell Bombers with the 12th Air Force during World War II.
One of the favorite features of the Letter is Russell’s daily Primary Trend Index (PTI), which is a proprietary index which has been included in the Letters since 1971. The PTI has been an amazingly accurate and useful guide to the trend of the market, and it often actually differs with Russell’s opinions. But Russell always defers to his PTI. Says Russell, “The PTI is a lot smarter than I am. It’s a great ego-deflator, as far as I’m concerned, and I’ve learned never to fight it.”
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Investors Intelligence is the organization that monitors almost ALL market letters and then releases their widely-followed “percentage of bullish or bearish advisory services.” This is what Investors Intelligence says about Richard Russell’s Dow Theory Letters: “Richard Russell is by far the most interesting writer of all the services we get.” Feb. 19, 1999.
Below are two of the most widely read articles published by Dow Theory Letters over the past 40 years. Request for these pieces have been received from dozens of organizations. Click on the titles to read the articles.
“Rich Man, Poor Man (The Power of Compounding)“
