Saturday, November 01, 2003

There doesn't seem to be anything about gold in this week's Barron's, but the interview with Jeremy Grantham was interesting. Jeremy says:

The simple story is the market is overpriced and will go to a trendline P/E, which we now believe is 16 times based on research that shows earnings tend to be overstated over time because assets tend to be underdepreciated during times of technological progress. Currently, the market is around 24 times trailing earnings, on a fairly generous earnings estimate. This is not just a bear market rally but the greatest sucker rally in history.

* * *

I was doing some thinking about the wedding season in India and China where the people give out gold as wedding gifts. As the economy in those two countries grow, and the people have more money, maybe they will buy more gold and this will cause the gold price to go up.

On the other hand, maybe with greater income will come greater Westernization, so instead of giving gold for wedding presents, they will give overpriced china and capuccino makers.

Friday, October 31, 2003

Mahendra, the astrologer and prophet, has issued more predictions today.

He said that gold went down on Thursday because of the strong growth figures, but he still predicts that gold will reach $400 by the end of next week. I sure hope so. I wish he'd also make a prediction about the Rand, because that strong Rand is killing my Durban Roodepoort Deep stock.

Also, he says next week will be good for silver "because Moon will be in happy mood.."

* * *

According to the Vietnam News Agency, the wedding season in Vietnam is contributing to the high gold price (see Gold prices rise as wedding bells chime). This is probably wishful thinking on the part of the Vietnamese that they are a big enough country to impact the global gold price. But the wedding season in India and China could impact the gold price.

Thursday, October 30, 2003

Very interesting article at Mineweb featuring an interview with Bill Murphy (see Gold conspiracy collapse is just a matter of time - Murphy).

Mineweb asks: "You were among those who predicted that once gold rose much above $300 per ounce, there would be a short covering panic to send gold soaring. Similarly, you forecast that JP Morgan was imminently close to collapse because of reckless derivative trading. Why shouldn’t those failed forecasts be the fatal flaws that knock you out as a reputable gold prognosticator?"

I think that's a really good question, and his answer sounds pretty evasive to me.

* * *

It is reported that the central bank of the United Arab Emirates has sold off half of its gold reserves (see Gulf News: Central Bank offloads gold reserves). This seems to fly in the face of the "Arabs are buying gold" theorists. If the UAE believed in the Islamic Gold Dinar then it doesn't make sense that they'd sell half of their gold.

* * *

If you're interested in investing in oil, and oil is something I'm certainly interested in, then you might be interested in my post The end of the Oil Age, Part I at my Calico Cat blog. However, it doesn't contain much that's relevant to investing in oil. Maybe in Part II I'll touch more on that area.

Wednesday, October 29, 2003

Mahendra has issued some new predictions. He says gold will be $400 by next weekend. Yay! I can't wait.

He also thinks that the fires in California portend bad things for the U.S. He says "I have seen in news that many house burn, that is clear indications of insecurity, or small kind of attack or big accident in USA or against USA interest." I have personally been wondering if these fires were actually set by terrorists, maybe that's what Mahendra is talking about?

* * *

The National Review serves up an article about gold, Ignoring the Gold Signal. The author asserts that the rising gold price indicates that we are experiencing inflation. Or maybe he's saying that if it rises any higher it would indicate inflation. I have a hard time following it.

Reuters reports on a Merril Lynch research note about how the strong Canadian dollar is hurting the earnings of Canadian gold mining firms (see Merrill forecasts gold miners to feel C$ squeeze).

* * *

The board of directors of Ashanti recommends the Anglogold buyout, and the Government of Ghana has announced its support (see Mineweb: AngloGold bags Ashanti). As those who read my blog know, I never thought the Randgold Resources offer made any sense. So it looks like soon, AngloGold will be even bigger than it already is.

Tuesday, October 28, 2003

JP Morgan upgraded Harmony Gold from Netural to Overweight. I thought JP Morgan was the company that hated gold and wanted everything gold to go down?

* * *

Mahendra Sharma hasn't been able to give us any predictions so far this week because of "negative planetary combinations". I hope that the planets get back into alignment soon so we can receive more wisdom from Kenya.

I wonder if I can use that excuse to get out of work. "Umm... I can't come to work this week because of negative planetary combinations."

Monday, October 27, 2003

Bill Fleckenstein doesnt have anything to say about gold or silver in his weekly Contrarian Chronicles column, but he's still bearish on the market in general (no surprise there).

* * *

Unilke Durban Roodepoort Deep, Harmony reported good earnings despite the strong Rand (see Mineweb: Harmony living with strong rand).

Sunday, October 26, 2003

It was obviously very frustrating on Friday for Durban Roodepoort Deep stockholders when ever other gold stock was up and DRD was down 18 cents. Maybe it was the article from Friday at Business Report, Drastic cost cuts may not stem losses at DRD mines, that hurt the stock price.

But an article at Gold-Eagle, Stealth Wealth, promises that DRD stock is going to blast off. I don't understand any of the charts, but I sure hope the author is right.

* * *

Mitsui Metals analyst Andy Smith warns of an "impending catastrophe for the gold market" (see Mineweb: A gold bear claws back). Doesn't sound so good.

But Jim Sinclair offers an 11 point rebuttal, and concludes that Andy Smith is "totally wrong" (see Mineweb: A gold bull gores).

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