Robert Prechter is again a genius after having been ridiculed most recently into the inflationary mini blowoff we've just waved goodbye to. He is of infinite patience and class, but the other bear/deflationists are coming out to play now as well.
This is not an indicator on timing but it is another of those things that tell me we can rally; not necessarily in the broad market, but sometime soon in the gold stock sector. There are key differences between today and Armageddon '08 and they are key to gold and gold stocks. Just look at the relative position of the precious metals to the USD in its precariously lofty state. But then, it's the inflationistas that worship the death of the buck, isn't it?
Real gold sector people know that what drives up the dollar... what drives up the VIX... what drives up the gold-silver ratio... gold-oil, gold-copper... all that stuff; they know what this means and my newsletter is going to focus on these meanings ever more maniacally going forward because for the first time in a year I have something I feel I can be actionably bullish on.
Back on subject...
One key ingredient for me that long time readers will remember is when deflationists come on with the 'taking the dumb bulls to school' attitude. Well, here is the one and only Karl Denninger; school is in session:
The Roof Is On Fire
I emphasize patience and I emphasize cash. Beyond that, with the 'D Boys' out in force, I also emphasize that it is time to once again begin focusing on the investment merit of the gold sector (the metal first and foremost) in an environment where economic contraction is being forced upon us by all manner of bad monetary policy.
I should note that I like Denninger and do not disagree with much of what he has to say here. But again, I have been awaiting a "deflation event" for longer than I found convenient. It is here.
