It is obvious that through this crisis, despite some turbulence, gold prices have held up better than just about any other asset, commodity or currency (other than dollars and yen) we may imagine. From the point of view of a gold miner, this is a very good thing. Even better is that the price of oil, a significant cost input for miners, has fallen a lot relative to gold. This is bullish for margins…
February 4th, 2009 | Ed Bugos | 1 comment | ContinuedArchive for Ed Bugos
Debunking the Velocity of Money Myth
I worry about the deflation possibility. I am always considering new facts and old premises as part of an analytical check to my evolving outlook. My recent tirade is not against the “possibility” of deflation – which cannot be denied. It is a reaction to the nonsense that underlies the great many bad arguments for deflation, which are either littered with factual errors about history or rely on theoretical concepts that are outdated, obsolete and have been long discredited…
January 15th, 2009 | Ed Bugos | 11 comments | Continued
Gold Price Outlook – the Long and Short of it
Gold prices have been all over the place lately…but Ed Bugos points out, below, that the outlook for both long and short term is bullish, but you will need to have some patience…
January 9th, 2009 | Ed Bugos | 0 comments | Continued
Gold Demand Looks Bullish As Dust Settles
The late November rally in gold prices wasn’t quite as spectacular as mid-September’s gain, but it was still impressive. There was good follow-through too, though the momentum softened as bulls knocked on resistance near $850. The rally was a no-brainer. There is a strong line of support at $700, which was resistance during 2006 and the first half of 2007. Moreover, the market was, and is, oversold…
December 5th, 2008 | Ed Bugos | 1 comment | Continued
Central Bank Tries to Determine Interest Rates as Far as it Can
That is, the central bank tries to determine interest rates as far as it can. The rationale for this policy is to attain full employment and price stability…
November 20th, 2008 | Ed Bugos | 5 comments | Continued
Gold Share Investors May Stumble Upon the Bull Market
There are only two things gold bulls should worry about from this point forward, now that the general commodity correction is out of the way and the froth has been worked out of the market: deflation in the strict sense of the term (monetary, not asset deflation) or a suddenly brightening economic outlook, both of which, in this writer’s opinion, would require a political austerity hardly imaginable these days.
October 16th, 2008 | Ed Bugos | 1 comment | Continued
The Bailout is Approve So Now It’s Time to Buy Gold
Investors are sure getting their share of information overload. In just two months, the economic landscape in America has markedly changed. It will change in the rest of the world, too. And not for the better, despite the pleasantly surprising news that the U.S. House of Representatives actually rejected the $700 billion bailout – the Treasury’s latest harebrained idea. Maybe it demonstrates there is a limit to how much the American people will tolerate…
October 2nd, 2008 | Ed Bugos | 0 comments | Continued
Gold Bulls Are Popping With Enthusiasm About the Post-FOMC Recovery in Gold Prices
Ben won’t be there long, anyway, especially if he mucks this up. Maybe the new administration will replace him. Then he could write a book debunking gold bug myths about the Federal Reserve System, such as the one about how the Fed is “the engine of inflation.” Anyway, the markets, overall, are performing as expected.
July 18th, 2008 | Ed Bugos | 0 comments | Continued
Gold Bull Market Only in its Teens
The bull market in gold started on a transition to “the middle stages” of an inflation cycle that began with Greenspan’s reign in the nineties. During that decade, the pundits argued that inflation was dead and that there was no longer any correlation between money supply growth and the price level, which was true if you forgave the method of calculation of both statistics, and ignored the technology bubble. But, the fact was simply that we were in “the early stages” of a new inflation cycle.
March 28th, 2008 | Ed Bugos | 8 comments | Continued
The Real Gold Bull Market is About to Stand Up
Let’s consider what the Federal Reserve is doing for the trend in gold prices – a trend, I am loathe to inform you, which it is not fighting. Let me sum it up: the trajectory of this bull trend shifted north when Bernanke took the helm of the Federal Reserve System, and that the policies pursued by the Bernanke Fed have confirmed the investment thesis driving the bull market in gold. As one pundit recently noted during a Bloomberg interview, “You gotta go with the inflation theme… it’s the only thing still working.”
March 14th, 2008 | Ed Bugos | 1 comment | Continued
Gold is Really the Only Alternative to the U.S. Dollar
Gold critics often say that the shiny yellow metal has few industrial uses, compared with, say, silver or copper. That happens to be what we call a half-truth. It’s also beside the point. It is usually lamented by bears refusing to accept the market’s valuation of gold. The whole truth is that gold has very [...]
December 14th, 2007 | Ed Bugos | 11 comments | Continued
