Look: I am eager to learn stuff I don't know--which requires actively courting and posting smart disagreement.

But as you will understand, I don't like to post things that mischaracterize and are aimed to mislead.

-- Brad Delong

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Everything that appears on this blog is the copyrighted property of somebody. Often, but not always, that somebody is me. For things that are not mine, I either have obtained permission, or claim fair use. Feel free to quote me, but attribute, please. My photos and poetry are dear to my heart, and may not be used without permission. Ditto, my other intellectual property, such as charts and graphs. I'm probably willing to share. Let's talk. Violators will be damned for all eternity to the circle of hell populated by Rosanne Barr, Mrs Miller [look her up], and trombonists who are unable play in tune. You cannot possibly imagine the agony. If you have a question, email me: jazzbumpa@gmail.com. I'll answer when I feel like it. Cheers!

Monday, September 26, 2011

Monday Market Action

The recovery from Friday in the SP500 is continuing in an orderly, non-dramatic way, following a nicely-defined channel that will be highlighted the next time I post a chart.  The index rise accelerated a bit in late afternoon, and it closed at the top of the channel.  Not a lot to add to Friday's assessment until the down-trend continues.

The gold market is much more interesting, though.  Since topping at $1921.50 on September 6, gold appears to be in the early stages of a major level decline.  I see from the chart in my side bar that it has now dropped below $1600, and recovered a bit this afternoon.  That's a pretty dramatic 3 weeks.  Gold should continue to slide for several years before it bottoms out somewhere well south of $1000 per ounce.

 For more on gold, see StatsGuy and Karl Smith.

The problem with trying to figure a rational price for gold is that is has no intrinsic value - or, a least, none that makes sense in terms of pricing in a range approaching $2000.  So who do you think could be getting this right - a gray-haired old man with nothing to go on but skepticism, or world-famous veteran speculator Jeremy Granthom, who bases his reasoning on supply constraint?  Evidently he hasn't seen the links, above.


Suzan said...

You're rocking today, jazz.

I'm so glad to know that we feel the same way about the intrinsic value of gold.

Gold bugs have always puzzled me. Mostly they seem like Glenn Beck "thinkers," meaning they are getting some type of kickback from the sale of gold and so they constantly promote the fear that drives people to buy it in self defense.

I'd rather have several year's supply of foodstuffs when the going gets really bad.


Jazzbumpa said...

I have more gold on one finger than in my portfolio.